SEC: Game Over For Take-Two Distributor

Law360, New York (May 4, 2007, 12:00 AM EDT) -- The Securities and Exchange Commission on Wednesday instituted cease-and-desist proceedings against a game distributor that allegedly helped Take-Two Interactive Software Inc. play the system by buying shipments of games to boost Take-Two’s revenue and then returning them.

According to the SEC, from October 2000 to at least July 2001, Capitol Distributing LLC and its principal operator Terry M. Phillips entered into a scheme with Take-Two that allowed the game producer to improperly report $15 million in revenue.

Phillips and Take-Two began discussing Capitol’s participation in the...
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