Hasbro Faces Off Against Investors Over "Magic: The Gathering" Flop.
A scathing lawsuit has been filed against Hasbro, the owner of popular trading card game "Magic: The Gathering," alleging that company executives engaged in gross mismanagement and breached their fiduciary duties by overproducing cards. Two investors, Joseph Crocono and Ultan McGlone, claim that comments made during Hasbro's shareholder calls between 2021 and 2023 were intentionally misleading and led to the repurchase of shares at inflated prices.
According to the 76-page complaint, the overproduction of "Magic" cards has decimated the game's long-term value. The suit cites a Bank of America report from 2022, which warned that the oversupply of cards was propping up Hasbro's recent results but destroying its brand. As a result, the company repurchased 1.4 million shares for $125 million between April and July 2022, at a loss of $55.9 million.
Industry insiders have long pointed to Hasbro's aggressive expansion into new markets as a key driver of the game's success. However, some have also raised concerns about the potential consequences of overproducing cards. Now, two investors are seeking damages for what they claim was a deliberate attempt by company executives to cover up shortfalls in other areas.
Hasbro has yet to publicly comment on the lawsuit, with an earnings call scheduled for February 10 revealing more details about the game's financial performance.
A scathing lawsuit has been filed against Hasbro, the owner of popular trading card game "Magic: The Gathering," alleging that company executives engaged in gross mismanagement and breached their fiduciary duties by overproducing cards. Two investors, Joseph Crocono and Ultan McGlone, claim that comments made during Hasbro's shareholder calls between 2021 and 2023 were intentionally misleading and led to the repurchase of shares at inflated prices.
According to the 76-page complaint, the overproduction of "Magic" cards has decimated the game's long-term value. The suit cites a Bank of America report from 2022, which warned that the oversupply of cards was propping up Hasbro's recent results but destroying its brand. As a result, the company repurchased 1.4 million shares for $125 million between April and July 2022, at a loss of $55.9 million.
Industry insiders have long pointed to Hasbro's aggressive expansion into new markets as a key driver of the game's success. However, some have also raised concerns about the potential consequences of overproducing cards. Now, two investors are seeking damages for what they claim was a deliberate attempt by company executives to cover up shortfalls in other areas.
Hasbro has yet to publicly comment on the lawsuit, with an earnings call scheduled for February 10 revealing more details about the game's financial performance.
. sounds like they just wanted to flood the market and clear out inventory before the value dropped... it's not like they didn't see this coming (but let's be real, we all know how well "Magic: The Gathering" has been doing lately). anyone else feel like buying a bunch of overpriced cards only to watch their value tank 
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like, i get it they want to grow the game but not at the cost of ruining it for us fans. this is so frustrating on top of all the new sets coming out every year and then these two investors are saying they're getting ripped off too 
i don't know about the lawsuit but i do know that i'm gonna be keeping a close eye on hasbro's earnings call next month 
Hasbro is trying to mess with people's wallets 
and I'm all for it 
Magic: The Gathering fans have been loyal for years, they deserve better 
. The game's value would've stayed up if those executives didn't be so greedy 
Can't wait to see what the truth reveals 
maybe it'll clear up all this drama 
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. I mean, come on, investors are always talking about short-term gains and long-term losses... it's all part of the game 
. Hasbro's expansion into new markets is a bold move, and yeah, maybe they overproduced some cards – but that doesn't necessarily mean they did anything wrong 
. "Magic: The Gathering" has been around for decades, and it's still going strong 
) just seems kinda opportunistic 
. We should be supporting these kinds of companies that take risks and try new things – after all, that's what innovation is all about 
!
According to my data, Hasbro's "Magic: The Gathering" sales did dip in 2022, but that was largely due to the pandemic and changes in consumer behavior 
Not sure if overproduction is the main culprit here tho 
Bank of America report from 2022 said oversupply would destroy brand value, but what about all the new fans who started playing during that time? 
And those 1.4 million shares repurchased for $125m? That's a big chunk of change 
I mean, they've been in the game (pun intended) for a while and have had their ups and downs. Overproducing cards might be a risk, but it's not like it was an intentional move to scam investors... or is it? 
. I get why they want answers, but have they considered just sticking with the game they know and love? It's not like Magic: The Gathering is going anywhere anytime soon 
. The kids aren't going to stop playing cards just because some investors are trying to make a quick buck 
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. I mean, who wants a bunch of useless cards just to fill space in the game? It's gotta affect the value or the whole point is gone 
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