Activision Blizzard Inc. Chief Executive Officer Robert Kotick, along with Activision Chairman Brian Kelly and other directors have agreed to a $275 million settlement of investor claims that officials improperly benefited from a buyout of Vivendi SA’s stake in the video-game maker.
As part of the settlement, which was approved by Delaware Vice Chancellor J. Travis Laster in a written opinion Wednesday, the lead plaintiffs’ attorneys will reap $72.5 million in fees.
The amount, which will come out of the settlement, will largely go to two small firms -- Friedlander & Gorris PA and Bragar Eagel & Squire PC.
The firms had their work cut out for them, Laster said.
They were facing defense counsel that included Gibson, Dunn & Crutcher LLP, Sullivan & Cromwell LLP, Wachtell, Lipton, Rosen & Katz and Skadden, Arps, Slate, Meagher & Flom LLP.
In approving the award, Laster emphasized the challenges for the two plaintiffs’ firms.
“The litigation in this case was more complex than the typical Court of Chancery Case,” he wrote. Lead counsel had “obtained and reviewed in excess of 800,000 pages of documents from the defendants and numerous non-parties,” he said, noting that the lawyers “had to engage in careful detective work to understand what happened, given the wholesale assertions of privilege and the contemporaneous destruction of documents.”
The $275 million settlement – minus the attorneys’ fees – will go back into the company under the terms of the deal.
While it’s unclear how much insurance will contribute to the settlement, Kotick, Kelly and other directors will probably dig into their own pockets to come up with funds for the accord, said Erik Gordon, a professor at the University of Michigan’s business and law schools who teaches about corporate litigation.
The case is In re Activision Blizzard Inc. Stockholder Litigation, 8884, Delaware Chancery Court (Wilmington).