Monday, July 11, 2011

Investor Sues News Corp

Sorry Rupe, It's Your Money She Fancies

 Amalgamated bank has Rupert Murdoch right in its crosshairs.   As an investor, Amalgamated is suing News Porn Corp. in a class action suit alleging egregious corporate mismanagement.

The claims, filed in Delaware Chancery Court, allege that recent developments at News of the World in the U.K. demonstrate "a culture run amuck (sic) within News Corp. and a Board that provides no effective review or oversight."
"News Corp.'s behavior has become an egregious collection of nepotism and corporate governance failures, with a board completely unwilling to provide even the slightest level of adult supervision," Jay Eisenhofer, co-lead counsel to shareholders, said in a statement. "The result has been a piling on of questionable deals, a waste of corporate resources, a starring role in a blockbuster scandal, and a gigantic public relations disaster. It is way past time that the News Corp. board step in and initiate serious changes to the company's corporate governance."

The new claims add to an earlier class action complaint filed in March against News Corp. over its acquisition of Chairman Rupert Murdoch's daughter's television production company Shine Group Ltd. In the original suit, the shareholders, who also include several municipal and union pension funds, claim Mr. Murdoch orchestrated the acquisition at an "artificially inflated price" to enrich his family.

"As he has done without restraint for decades, Murdoch has caused News Corp to spend its own money – in this instance at least $615 million – out of blatant nepotism and without regard for the interests of the Company or its public shareholders," according to the new suit. 

It looks like Rupe is on the ropes.   The old bugger has the British government and Scotland Yard after him which could trigger criminal corruption proceedings against him and his son in the U.S.   Now his company's shareholders are on the warpath looking, by all appearances, for old Rupe's head on a stick.  It couldn't happen to a nicer guy.


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