In a significant victory for shareholders, Labaton Keller Sucharow secured a $125million settlement on behalf of former Discovery, Inc. shareholders.  The agreement comes as the shareholders’ lawsuit – In re: Warner Bros. Discovery Inc. Stockholders Litigation – was scheduled for a five-day trial in November 2024.  This settlement is one of the largest pretrial settlements in the Delaware Chancery Court.

The settlement ends stockholder challenges to Discovery Inc.’s $43 billion merger with AT&T’s Warner Media in 2022.

Following a Section 220 demand and investigation, Plaintiffs filed a complaint alleging that Advance Newhouse Partnership (A/N) used it’s nearly 25% equity stake to coerce Discovery’s Board of Directors to side with A/N in the transaction while failing to recuse themselves from the process despite the intention to extract a side payment of approximately $1.1 billion based on Discovery’s then-trading price.  A/N also knew that any premium would come directly from other Discovery stockholders as they were focused on the “relative post-closing ownership percentages.”

Under the agreement, $100 million will be paid by Advance/Newhouse and Advance/Newhouse Programming Partnership while $12.5 million will be paid by CEOs of the two companies, Robert and Steve Miron respectively.