Activision Blizzard shareholder sues over Microsoft sale

polygon.com:

An Activision Blizzard shareholder filed a lawsuit against the game publisher and its board of directors over alleged Securities Exchange Act violations in its proposed plan for its sale to Microsoft.

The lawsuit, filed by shareholder Kyle Watson, was filed in California on Thursday. Watson’s lawyers called Activision Blizzard’s plan for the sale, outlined in a recent Securities and Exchange Commission (SEC) proposal, “unfair for a number of reasons” — one of which, lawyers said, is that the board is looking to “procure for themselves and senior management [...] significant and immediate benefits.”

The lawsuit calls into question potential conflicts of interest, specifically that the deal “is not in the best interest” of Activision Blizzard, Watson, nor company stockholders, and “will produce lucrative benefits for the [Activision Blizzard’s] officers and directors.” It also referenced the “golden parachute” that some executives, like CEO Bobby Kotick, would receive should he be fired. The SEC filing, called a 14A, includes information necessary before shareholders vote in agreement.

Elsewhere in the filing, Watson’s lawyers allege that Activision Blizzard’s Feb. 18 SEC filing is “materially misleading and incomplete,” violating the Exchange Act. It calls out missing information in the SEC filing relating to the “ad hoc committee” that ran the sales process, as well as information about “post-transaction employment” and other relevant data.

Watson is looking for the court to order Activision Blizzard to release a new SEC preliminary proxy statement that includes more facts and no “untrue statements.” Should the proposed transaction go through, Watson is looking for “rescissory damages.”

As part of the proposed