Carlyle Founders Must Face Lawsuit Over $344 Million Payout (1)

Carlyle Group Inc.'s founders and other corporate leaders lost their bid Wednesday for an early end to litigation over a $344 million buyout of tax agreements tied to the asset manager’s public listing.

A Delaware judge, Vice Chancellor Morgan T. Zurn, let the case move forward against the billionaire co-founders—William Conway Jr., Daniel D’Aniello, and David Rubenstein—and other Carlyle board members. The shareholder lawsuit, brought by a pension fund, says they pushed the private equity giant into an overpriced payout aimed at terminating virtually worthless tax benefits.

A spokesperson for Carlyle didn’t immediately respond to a request for comment ...