This Week in Chancery Court: Mattel Settlement, Paramount Files

This week in the Delaware Chancery Court, Paramount Global goes to trial over internal files about its merger with Skydance Media, and Mattel Inc. seeks approval of a settlement to resolve litigation over infant deaths and injuries allegedly linked to the Fisher-Price Rock ‘n Play Sleeper.

Here’s a look at highlights from the court’s calendar:

Monday: Leo Inv. Hong Kong Ltd. v. Tomales Bay Cap. Andurill III LP, Del. Ch., No. 2022-0175, hearing 3/31/25.

At issue: A lawsuit over a failed SpaceX investment venture went to trial last December, in a case involving a joint venture formed by Leo Investments Hong Kong Ltd. and Tomales Bay Capital LLC to buy a piece of Elon Musk’s private space flight company. SpaceX isn’t named as a party in the litigation. Leo alleges that Tomales terminated the deal less than a week after signing it. Vice Chancellor J. Travis Laster, who narrowed the claims in a Nov. 4 order granting partial summary judgment, now hears closing arguments in the case.

Court action: A hearing for post-trial arguments will be held in Wilmington, Del.

Failed SpaceX Investment Deal Lawsuit Gets Go-Ahead in Delaware

Tuesday: In Re Mattel Inc. Rock ‘n Play S’holder Derivative Litig., Del. Ch., No. 2020-0552, settlement hearing 4/1/25.

At issue: Mattel Inc.‘s board and senior leadership will pay, through their insurers, almost $17 million and enact corporate governance changes to resolve long-running litigation, according to a proposed settlement. Investors alleged the company spent years hiding deadly problems with the Fisher-Price Rock ‘n Play Sleeper before finally recalling it over dozens of infants’ deaths and hundreds of injuries. About 4.7 million Rock ‘n Play Sleepers were sold between 2009 and 2019, when Fisher-Price announced the recall. Vice Chancellor Morgan T. Zurn must give final approval to the settlement, which also would require recognition of Mattel’s head of product quality and safety as a formal member of the company’s global management team.

Court action: A settlement hearing will be held in Wilmington, Del.

Mattel Board Hid Baby Deaths Before Sleeper Recall: Suit (1)

Tuesday: Gabelli Value 25 Fund v. Paramount Glob., Del. Ch., 2024-1353, trial 4/1/25.

At issue: Money manager Mario Gabelli asked the Chancery Court to order Paramount to hand over internal files about the Skydance merger so investors can determine how controlling stockholder Shari Redstone might benefit from the deal. Gabelli’s funds own about 12% of Paramount voting shares. A trial will determine whether Gabelli is entitled to inspect any of the film and TV company’s books and records, and, if so, the appropriate scope of an inspection.

Court action: Senior Magistrate in Chancery Selena E. Molina will preside over a one-day trial in Wilmington, Del.

Gabelli Pushes Paramount for Files in Fight Over Skydance Deal