Updated at 12:10 p.m. June 27, 2017
SeaWorld shareholders had a sinking feeling Monday — three days after the Orlando-based theme park company announced it was under investigation by the SEC and U.S. Justice Department.
Fallout from the critical 2013 documentary “Blackfish” continued to take its toll. Share prices fell 6 percent to under $15 but inched back over $15 in after hours and early Tuesday trading.
(Before “Blackfish,” shares were as high as $39.65. At one point in September 2016, they had tanked to $11.77.)
Late Friday afternoon, SeaWorld revealed it had received a DOJ subpoena this month “concerning disclosures and public statements” it and “certain executives and/or individuals” made around August 2014, “including those regarding the impact of the ‘Blackfish’ documentary, and trading in the company’s securities.”
The Securities and Exchange Commission also asked for information; SeaWorld didn’t say when.
But former SeaWorld orca trainer John Hargrove, who appeared in “Blackfish” and wrote a book slamming his former employer, told Times of San Diego: “I’ve known about this SEC thing for two years. SeaWorld was covering it up somehow.”
A SeaWorld spokesman wouldn’t go beyond its 128-word statement on a Form 8-K filing — an unscheduled notice to shareholders of important company information.
SeaWorld San Diego’s David Koontz stressed Monday that the filing states: “The Company has cooperated with these government inquiries and intends to continue to cooperate with any government requests or inquiries.”
But MarketWatch also noted: “SeaWorld already faces an investor lawsuit focusing on the documentary, contending that executives ‘knew or were reckless in not knowing that “Blackfish” was impacting SeaWorld’s business.’ The suit seeks class-action status and compensation for investors who purchased SeaWorld shares between April 18, 2013, and Aug. 13, 2014, and a trial date of Sept. 18, 2018, has been set, according to SeaWorld’s filings with the SEC.”
Meanwhile, SeaWorld critics accused the company of not sharing honest information on the health of one of its prize orcas — SeaWorld San Diego matriarch Kasatka.
A widely shared post Saturday on the Dolphin Project alleged that Kasatka, mother of four SeaWorld killer whales and grandmother or great-grandmother of eight others, was near death from an undisclosed fungal infection.
SeaWorld in August 2016 said: “We have been treating Kasatka for a bacterial respiratory infection for several years.”
But Hargrove, who once worked with Kasatka, told Times of San Diego that SeaWorld was “doing everything known to science to keep her alive” for the sake of avoiding a third orca death in relatively quick succession — including the male Tillikum in January.
Hargrove shared photos that he says show open sores, and lesions over the orca’s face and skin, indicative of a massive fungal infection. Also what looks like “necrotic tissue,” or dead skin. (He said the photos were by a park visitor known as “Elizabeth.”)
“She has no immune system left,” he said in a phone interview. “She’s doped up with antibiotics. … I’ve never seen a whale torn up so badly.”
SeaWorld posted an FAQ in which it denied Kasatka has a fungal infection. But it allowed that “If an animal needs help, we provide it,” not ruling out use of antibiotics.
Citing recent photos, Hargrove also alleged that trainers were injecting hazardous-to-humans Regu-Mate into fish fed to Kasatka.
Hargrove called it a “very dangerous drug that only male trainers are allowed to administer” and only if they wear gloves. Female trainers could suffer infertility, he said.
He said the drug — marketed by Merck — has “gnarly, bad side effects for the whales.”
On Monday, spokesman Koontz confirmed the use of Regu-Mate, an equine drug also known as altrenogest that suppresses estrus in mares — keeping them calm in their cycles of uncontrollable “heat.”
“Kasatka is currently on Regu-Mate for birth-control purposes only,” Koontz said. “Regu-Mate is not part of her treatment program for her respiratory infection.”
Regarding the lesion accusations, Koontz said: “Our veterinarians suspect that her illness may have extended to her skin, or may be the result of the medication she is receiving.”
He said Kasatka has been regularly “sloughing off” the outermost layers of her skin in a number of areas on her body.
“However, her behaviorists and veterinarians see new growth underneath, which is good,” Koontz said. “This sloughing skin is also hyperpigmented, which is also probably secondary to some of her medication. There is no necrotic tissue.”
Although Hargrove has been an expert witness on orca health in various court cases, Koontz said the former Pacific Beach resident “is not a veterinarian and is not familiar with Kasatka’s condition, so it’s unclear why he would make those allegations.”
Moreover, Koontz said: “While we will continue to provide the best care for Kasatka, we know that this is a progressive disease, and understand that as she and her immune system age, she will continue to have a more difficult time fending off the illness.”
He said SeaWorld’s animal care team “remains passionately committed to ensuring her illness is properly managed and that above all else she continues to live a quality life.”
Tracy Reiman, executive vice president of SeaWorld nemesis PETA, said in a statement Monday: “The fate of captive orcas is to endure a miserable life and death. It’s too late for Kasatka, but it’s not too late for SeaWorld to start building sea sanctuaries for the other orcas trapped inside its tiny tanks, including Kasatka’s daughter and newborn grandchild in San Antonio. The decades of orca torment must end now.”
Fellow animal-rights advocate Naomi Rose — a renowned marine mammal scientist with the Animal Welfare Institute — said: “Without more information, I cannot say that Kasatka is near death.”
But statistically, she said, “it is likely that Kasatka will die soon. Kasatka is very old for a captive female whale (she is about 40-41 years old). Most female orcas who have died did so well before their 40th year. Only a handful are older than 35 at this time (Corky, also in San Diego, Lolita in Miami, Katina in Orlando and Kiska in Canada).”
But she agreed with Hargrove that SeaWorld is “not being forthcoming or transparent about the situation.”
“They should simply tell the truth about her health,” Rose said via email Monday. “This should not be something we are all speculating about – we should know, because SeaWorld should be accurately and without drama telling the public what is happening.”
SeaWorld spokesman Koontz said that the park would continue to provide updates on Kasatka’s condition — via its websites and social media (such as June 20 Facebook Live below) — “as we have new information to share.”
“It is worth noting that pneumonia, or respiratory inflammation or infection, is the number one cause of illness and mortality seen in all cetaceans, both in the wild and in zoological care,” he said. “Unlike wild orcas, Kasatka has been provided quality veterinary care to treat her respiratory infection.”