Great Wolf Resorts securities suit

The Capital Times of Wisconsin is reporting that Great Wolf Resorts now faces a securities lawsuit:

Madison-based Great Wolf Resorts has been hit with a class-action lawsuit accusing it of stock fraud in relation to the wide discrepancy between its projected and actual second-quarter earnings.

The indoor waterpark resort developer saw its stock plunge by nearly one-third on July 28, when it reported a second-quarter loss that was about 2 times wider than it had forecast. CEO John Emery called the incident “embarrassing.”

The suit filed in federal court in Madison by Scott + Scott LLC of Colchester, Conn., is on behalf of people who bought the company’s stock from last December when it began trading publicly and July 28.

It charges that the company knew in advance it couldn’t meet its forecast but hid the information from investors.