Orbitz 2014 Annual Report Download - page 28

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Delaware Actions relating to Expedia transaction: Since the announcement of the merger on February 12, 2015, six
putative shareholder class action lawsuits have been filed against Orbitz and its directors, among other parties, in the Court of
Chancery of the State of Delaware. The specific cases are: (i) Irving Feldbaum v. Barney Harford, et al., No. 10692, filed on
February 19, 2015; (ii) Tonya Diamond v. Orbitz Worldwide, Inc., et al., No. 10703, filed on February 23, 2015; (iii) Jonathan
Shiller v. Orbitz Worldwide, Inc., et al., No. 10704, filed on February 23, 2015; (iv) Suresh Rijhwani v. Barney Harford, et al.,
No. 10711, filed on February 24, 2015; Mathew Sciababucch v. Orbitz Worldwide, Inc. et al, No. 10726, filed on February 26,
2015; and (vi) Douglas Carlson v. Barney Harford, et al, No. 10736, filed on March 3, 2015. Collectively, we refer to these
actions as the “Delaware Actions”. In the Delaware Actions, plaintiffs allege that the individual director defendants breached
their fiduciary duties to Orbitz shareholders in negotiating and approving the merger agreement, that the merger consideration
negotiated in the merger agreement undervalues Orbitz, that Orbitz shareholders will not receive fair value for their Orbitz
common stock in the merger, and that the terms of the merger agreement impose improper deal-protection devices that
purportedly preclude competing offers. The complaints further allege that Orbitz, Expedia and Merger Sub aided and abetted
the alleged breaches of fiduciary duty by the Orbitz directors. Plaintiffs seek injunctive relief, including enjoining or rescinding
the merger, an award of unspecified attorneys' fees, and other relief.
The outcome of the Delaware Actions cannot be predicted with certainty. A preliminary injunction could delay or
jeopardize the completion of the merger, and an adverse judgment granting permanent injunctive relief could indefinitely enjoin
completion of the merger. Additional lawsuits arising out of or relating to the merger agreement or the merger may be filed in
the future. Defendants intend to vigorously defend against these lawsuits
Other Litigation
Trilegiant Corporation v. Orbitz, LLC v. and Trip Network, Inc.: On July 7, 2011, Trilegiant Corporation filed an
action for breach of contract and declaratory judgment in the Supreme Court of New York against Orbitz, LLC and Trip
Network, Inc. Trilegiant alleges that the defendants are obligated to make a series of termination payments arising out of a
marketing agreement that defendants terminated in 2007. In December 2012, Trilegiant moved to dismiss certain of Orbitz’s
affirmative defenses. In January 2013, Orbitz moved for summary judgment on all of Trilegiant’s claims, arguing that those
claims were barred by the illegality affirmative defense. On October 7, 2013, the Supreme Court of the State of New York
denied Orbitz’s motion for summary judgment. Orbitz filed its notice of appeal of that ruling on October 31, 2013. On
December 24, 2013, the Supreme Court dismissed the majority of Orbitz’s remaining affirmative defenses. Orbitz filed a notice
of appeal of that ruling on January 30, 2014. On August 22, 2014, the Supreme Court rejected Orbitz’s remaining affirmative
defenses, and Orbitz appealed that ruling on September 24, 2014. On January 15, 2015, the New York Supreme Court,
Appellate Division, First Department heard oral argument on Orbitz’s first two appeals relating to, among others, its
impossibility and illegality defenses. On February 19, 2015, the First Department affirmed the Supreme Court’s October 7,
2013 and December 24, 2013 rulings. On February 23, 2015, Orbitz filed its appellate brief relating to the Supreme Court’s
August 22, 2014 order.
We intend to defend ourselves vigorously against the claims described above. Litigation is inherently unpredictable and,
although we believe we have valid defenses in these matters, unfavorable resolutions could occur. Although we believe it is
unlikely that an adverse outcome will result from these proceedings, an adverse outcome could be material to us with respect to
our financial position, earnings or cash flows in any given reporting period.
Item 4. Mine Safety Disclosure
Not Applicable.