SeaWorld has reached a $65 million settlement agreement to end a 2014 class-action civil lawsuit that accuses the company of misleading investors over the damage from the “Blackfish” documentary.
The Orlando-based company revealed the settlement in a new SEC filing Tuesday.
The settlement comes as SeaWorld seeks to move forward after years of scrutiny over its orca habitats, turnover in the chief executive position and declining attendance. SeaWorld has seen high turnover among executives in recent years. Many of the leaders named in the lawsuit left years ago.
In the filing, SeaWorld does not admit any wrongdoing and the settlement must still be approved by the courts.
The 2013 “Blackfish” documentary brought long-standing criticisms of keeping whales in captivity into the mainstream and told the story of Dawn Brancheau, a beloved Orlando trainer who was killed in 2010 by Tillikum, one of the park’s largest orcas.
In the lawsuit filed in California, a group of investors accused SeaWorld executives of ignoring and denying the film’s backlash as attendance tumbled at the theme parks.
The year the film was released, SeaWorld Orlando’s attendance dropped 8% and SeaWorld San Diego 12% compared to the previous year while its competitors Universal and Disney continued to thrive, the court documents said.
“SeaWorld would blame the entirety of these declines on everything but ‘Blackfish’ – namely, adverse weather conditions, holiday and school schedules, and SeaWorld’s pricing strategies,” the lawsuit said.
SeaWorld leaders refused to acknowledge the “Blackfish effect” as they spoke to the media and during earnings calls with investors.
Privately, however, executives worried, according to court documents.
“Internally, a former SeaWorld employee reported that SeaWorld adopted an ‘extremely hush-hush’ policy, ‘feeding (SeaWorld employees) lines,’ instructing SeaWorld employees to dissuade family and friends from seeing the film, and, most egregiously, holding ‘a collective meeting before (Blackfish) came out telling (SeaWorld employees) to say it was fake,” the lawsuit said.
When SeaWorld finally acknowledged that the film hurt business, it cost investors millions of dollars. The company’s stock prices fell by almost 33%, a disaster for investors, the lawsuit said.
Afterward, SeaWorld also was under investigation by the federal government for similar allegations.
In 2018, the U.S. Securities and Exchange Commission fined SeaWorld $4 million and its former CEO James Atchison $1 million to settle fraud charges for misleading investors.
SeaWorld Entertainment is based in Orlando and runs 12 theme parks across the company.
The company has rebounded in the last two years as it aggressively adds new rides, cuts expenses and changes how animals are used in its shows.
SeaWorld recently said trainers will stop riding on the noses and backs of dolphins during its shows. Under former CEO Joel Manby, SeaWorld ended its orca breeding program in 2016.
The Orlando park also debuted its new killer-whale show last month that emphasizes education about the animals over theatrics.
All this comes as the public’s views on animals in captivity and how they are used for entertainment has evolved in recent years, said said Carissa Baker, an assistant tourism professor at the University of Central Florida.
“SeaWorld,” Baker said, “is transitioning into a different kind of park.”
©2020 The Orlando Sentinel (Orlando, Fla.)