Faruqi & Faruqi, LLP Encourages Investors Who Suffered Losses In Excess Of $100,000 Investing In Digital Generation, Inc. To Contact The Firm

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May 06, 2013, 06:00 ET

NEW YORK, May 6, 2013 /PRNewswire/ -- Faruqi & Faruqi, LLP, a leading national securities law firm, is investigating potential securities fraud at Digital Generation, Inc. ("Digital Generation" or the "Company") (NASDAQ: DGIT).

(Logo: http://photos.prnewswire.com/prnh/20120119/MM38856LOGO )

The investigation focuses on whether the Company and its executives violated federal securities laws by failing to disclose that: (1) Digital Generation's online segment was performing significantly below levels reported to investors; (2) Digital Generation's declining revenue base was being hidden behind Company acquisitions; (3) the Company had substantially overpaid for its acquisition of Media Mind, Inc. ("Media Mind") and other online segments in order to appear to be an attractive acquisition target; and (4) the Company was not sufficiently poised for a strategic partnership or buyout.

On November 8, 2012, the Company reported that for the quarter ending September 30, 2012, an impairment charge of over $208 million was taken against three of the online media assets it had recently acquired: Media Mind, Eye Wonder, and Peer 39. This impairment represented a staggering 33% write-down of the initial purchase price of these assets. Digital Generation also reported that the Company's television unit took an impairment charge of over $131 million.

On February 19, 2013, the Company issued a press release announcing that a Special Committee of the Company's Board of Directors had failed to approve any transaction or strategic alternative after exploring numerous options available to the Company, including a sale of all or parts of the business, a spin-off and split-off of parts of the business, capital structure alternatives, or potential merger combinations. In addition, the Company recorded a further $11.4 million write-down of its recently acquired online segments.

On this news, the Company's shares declined $2.53 per share or over 28% to close on February 19, 2013 at $6.45 per share.

Request more information now by clicking here: www.faruqilaw.com/DGIT. There is no cost or obligation to you.

Take Action

If you invested in Digital Generation stock or options between June 20, 2011 and February 19, 2013 and would like to discuss your legal rights, visit www.faruqilaw.com/DGIT. You can also contact us by calling Richard Gonnello or Francis McConville toll free at 877-247-4292 or at 212-983-9330 or by sending an e-mail to [email protected] or [email protected]. Faruqi & Faruqi, LLP also encourages anyone with information regarding Digital Generation's conduct to contact the firm, including whistleblowers, former employees, shareholders and others.

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FARUQI & FARUQI, LLP
369 Lexington Avenue, 10th Floor
New York, NY 10017
Attn: Richard Gonnello, Esq.
[email protected]
Francis McConville, Esq.
[email protected]
Telephone: (877) 247-4292 or (212) 983-9330

SOURCE Faruqi & Faruqi, LLP