Twenty-First Century Fox 2013 Annual Report Download - page 140

TWENTY-FIRST CENTURY FOX, INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
claims under Section 10(b) and Section 20(a) of the Securities Exchange Act, alleging that false and misleading
statements were issued regarding the NoW Matter. The suit names as defendants the Company, Rupert Murdoch,
James Murdoch and Rebekah Brooks, and seeks compensatory damages, rescission for damages sustained, and
costs. On June 5, 2012, the court issued an order appointing the Avon Pension Fund (“Avon”) as lead plaintiff
and Robbins Geller Rudman & Dowd as lead counsel. Thereafter, on July 3, 2012, the court issued an order
providing that an amended consolidated complaint shall be filed by July 31, 2012. Avon filed an amended
consolidated complaint on July 31, 2012, which among other things, added as defendants NI Group Limited (now
known as News Corp UK & Ireland Limited) and Les Hinton, and expanded the class period to include
February 15, 2011 to July 18, 2011. The defendants have filed motions to dismiss the complaint which are
pending. The Company’s management believes the claims in the Wilder Litigation are entirely without merit, and
intends to vigorously defend those claims.
On July 22, 2011, a purported shareholder of the Company filed a derivative action captioned Stricklin
v. Murdoch, et al. (“Stricklin Litigation”), in the United States District Court for the Southern District of New
York. The plaintiff brought claims for breach of fiduciary duty, gross mismanagement, and waste of corporate
assets in connection with, among other things, (i) the NoW Matter; (ii) News America’s purported payments to
settle allegations of anti-competitive behavior; and (iii) the Shine Transaction. The action named as defendants
the Company, Les Hinton, Rebekah Brooks, Paul Carlucci and the directors of the Company. On August 3, 2011,
the plaintiff served a motion for expedited discovery and to appoint a conservator over the Company, which
defendants objected to. The motion was not briefed. On August 16, 2011, the plaintiffs filed an amended
complaint. The plaintiff sought various forms of relief including compensatory damages, injunctive relief,
disgorgement, the award of voting rights to Class A shareholders, the appointment of a conservator over the
Company to oversee the Company’s responses to investigations and litigation related to the NoW Matter, fees
and costs.
On August 10, 2011, a purported shareholder of the Company filed a derivative action captioned Iron
Workers Mid-South Pension Fund v. Murdoch, et al. (“Iron Workers Litigation”), in the United States District
Court for the Southern District of New York. The plaintiff brought claims for breach of fiduciary duty, waste of
corporate assets, unjust enrichment and alleged violations of Section 14(a) of the Securities Exchange Act in
connection with the NoW Matter. The action named as defendants the Company, Les Hinton, Rebekah Brooks
and the directors of the Company. The plaintiff sought various forms of relief including compensatory damages,
voiding the election of the director defendants, an order requiring the Company to take certain specified
corporate governance actions, injunctive relief, restitution, fees and costs.
On November 21, 2011, the court issued an order setting a briefing schedule for the defendants’ motion to
stay the Stricklin Litigation, the Iron Workers Litigation and the Shields Litigation pending the outcome of the
consolidated action pending in the Delaware Court of Chancery. On September 18, 2012, the Court denied the
motion as to two of the cases and dismissed the third with leave to replead, which the plaintiff did. Specifically,
on October 4, 2012, Stricklin filed a Second Amended Complaint that added a claim under Section 14(a) of the
Securities Exchange Act challenging the disclosures in the Company’s definitive proxy statements issued during
the years of 2005 through 2012. The plaintiff sought, among other things, to void the election of the director
defendants at the Company’s 2012 annual meeting. The plaintiffs in Shields, Stricklin and Iron Workers
requested a pre-motion conference to address the potential consolidation of these derivative actions and a
briefing schedule regarding the potential leadership structure for the plaintiffs, but a pre-motion conference was
not held and the actions were not consolidated.
On July 16, 2013, after the dismissal of the Consolidated Action by the Delaware Court of Chancery as
discussed above, the court entered uncontested Orders of Dismissal in the Shields Litigation, the Stricklin
132