Investors Say Coinstar Pumped Up Redbox Prospects

Law360, New York (January 25, 2011, 3:49 PM EST) -- Shareholders have sued supermarket coin-counting kiosk maker Coinstar Inc. alleging the company hid problems with its DVD rental subsidiary prior to releasing a disappointing 2010 earnings report, costing investors millions of dollars.

In a complaint filed Monday in the U.S. District Court for the Western District of Washington, investors claim that Coinstar did not reveal that declining sales, a 28-day delay on video rentals imposed by movie studios and distribution problems at its DVD rental subsidiary Redbox Automated Retail LLC were bringing down Coinstar's bottom line....
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