Take-Two settles shareholders' EA buyout suit
Grand Theft Auto IV publisher agrees to disclose additional information regarding Madden maker's $1.9 billion buyout attempt; no monetary damages awarded.
In March 2008, a group of shareholders led by Patrick Solomon filed a class-action lawsuit against Take-Two related to the publisher's dismissal of EA's $1.9 billion buyout offer. According to the shareholder suit, Take-Two breached its fiduciary duties by, among other purported misdeeds, not fully disclosing EA's offer and taking up a severance plan that would see executive employees receive a heavy payout in the event that they lost their jobs due to the buyout. After an extended back-and-forth, EA walked away from the deal in September.
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In a Securities and Exchange Commission filing today, Take-Two disclosed that it has reached an agreement with those who brought the suit. As part of the settlement, Take-Two has agreed to additional disclosures related to the EA buyout offer. The settlement does not provide for any monetary remuneration to Solomon or the rest of the class, and Take-Two said that it plans to challenge any application for attorney fees and expenses.
Take-Two also noted that though it has agreed to settle the case, it has done so in the interest of saving "the time and expense of continued litigation." Take-Two was also quick to say that it has opted to disclose the supplemental information not because it felt that its original submission was "misleading or incomplete," but to avoid any further argument on the manner.
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