A group of disgruntled minority shareholders have filed a class action lawsuit in the US Chancery Court of Delaware against Liberty Media. The shareholders, led by Blackthorn Partners, which is the largest public shareholder in Liberty Media, allege that…
A group of disgruntled minority shareholders have filed a class action lawsuit in the US Chancery Court of Delaware against Liberty Media. The shareholders, led by Blackthorn Partners, which is the largest public shareholder in Liberty Media, allege that Liberty chairman John Malone and his wife unfairly benefitted from the merger of Liberty Entertainment and DirecTV in late 2009.
The plaintiff claims that while the majority of public shareholders in Liberty received 1.111 shares of DirecTV class A common stock, Malone and his family received 1.1111 shares of DirecTV class B common stock. This stock entitled them to 15 votes per share, as compared to one vote per share for class A stockholders, as well as a number of consent rights. According to Blackthorn this stock gave Malone and family approximately US$160m of considerations that the public shareholder did not get. Blackthorn also claims that the transaction enabled Malone to be free from a premium cap on his investment.
Montgomery, McCracken, Walker & Rhoads is representing the plaintiffs.