DIRECTV operates the largest direct broadcast satellite (DBS) service in the US, ahead of #2 DISH Network, and in direct competition with cable providers Comcast and Time Warner. It provides service to more than 17 million customers in the US and another 5 million in Latin America. Additionally, phone companies such as Verizon bundle DIRECTV video services with their voice and Internet packages. The company also offers high-definition and video-on-demand (VOD) programming. Other assets include FOX Sports Net and a stake in the Game Show Network. Liberty Media controls 48% of DIRECTV’s voting power.
Case description: Alleged unfair merger compensation and breach of fiduciary duty by the Board of Directors.
Cypress acted as consultants on behalf of New Orleans Employees’ Retirement systems regarding valuation, process and governance issues and the fairness of the transaction. The case settled.
Cypress Associates LLC successfully assisted its clients, the shareholders of Activision Blizzard Inc. (“Activision”), secure a record $275 million settlement. This represents the largest settlement of shareholder derivative lawsuit in Delaware to date. Activision is the leading global video game publisher and best known for franchises such as World of Warcraft and Call of Duty.
The lawsuit by Activision shareholder Anthony Pacchia was prompted by the $8 billion transaction in 2013 in which Activision and a separate investor group (“ASAC”) led by Activision’s CEO and Board Chairman bought Activision stock from Vivendi, a French media-focused conglomerate, at a below-market price. As part of the Delaware Chancery Court lawsuit settlement, two unaffiliated directors will also be added to the Activision board and ASAC’s voting rights will be reduced from 24.9% to 19.9%.
Cypress offered expert witness testimony on behalf of shareholders as to the disputed transaction and the damages suffered as result of not pursuing feasible alternatives in which Activision – rather than the CEO, Board Chairmen and their investor group – would have repurchased the Vivendi shares. Notwithstanding the fact that the transaction created significant stock price appreciation, Cypress demonstrated that realistic alternative transactions available to Activision that would have created even more value for shareholders.
Bank of America is one of the largest commercial and investment banks in the world.
Case description: Alleged failure to disclose to Bank of America shareholders Merrill Lynch’s $20 billion in losses prior to Bank of America’s shareholder vote.
Cypress was offered as a rebuttal expert with respect to Bank of America’s expert who claimed the long-term benefit of acquiring Merrill outweighed the costs. Cypress’ clients achieved a $2.43 billion settlement with Bank of America.
Inergy LP’s operations include a natural gas storage business in Texas and an NGL supply logistics, transportation, and wholesale marketing business that serves customers in the United States and Canada. Inergy is also engaged in the development and operation of a natural gas and NGL storage and transportation business in the Northeast region of the United States.
Case description: Alleged excess purchase price and breach of fiduciary duty by the Board of Directors of Inergy L.P. in connection with its acquisition of its General Partner, Inergy Holdings
Cypress was offered as an expert witness on behalf of the Defendant with respect to Master Limited Partnerships, the valuations of Inergy L.P. and Inergy Holdings and the appropriate acquisition exchange ratio. The case settled.
ACS provides information technology services as well as business process outsourcing solutions to businesses, government agencies, and non-profit organizations.
Case description: Alleged that the members of the ACS board of directors breached their fiduciary duties by approving a merger with Xerox which allowed Darwin Deason, ACS’s founder, Chairman and largest stockholder, to extract for himself hundreds of millions of dollars of value that rightfully belonged to ACS’s public shareholders.
Cypress was offered as an expert witness on behalf of the court-appointed class plaintiffs regarding the fair value of ACS as well as the valuation and fairness opinions of ACS’s financial advisors. The case was settled in May 2010, with Deason, ACS and Xerox agreeing to pay a total of $69 million in cash.
Landry’s Restaurants is a leading full-service restaurant operator with more than 275 locations throughout the US. The company’s estate of eateries is anchored by its flagship Landry’s Seafood House chain; other concepts include Rainforest Cafe, McCormick & Schmick’s, Saltgrass Steak House, and Bubba Gump Shrimp. The company also owns and operates the iconic Golden Nugget Hotel & Casino in Las Vegas, along with a number of other entertainment properties, including aquariums, hotels, and other tourist attractions
Case description: Alleged that Landry’s CEO, Fertitta, and the Landry’s board of directors breached their fiduciary duties by stripping Landry’s public shareholders of their controlling interest in the Company for no premium and severely devalued Landry’s remaining public shares.
Cypress was offered as an expert witness on behalf of Louisiana Municipal Police Employees’ Retirement System regarding the Board’s conduct in approving a reduction in the price to be paid in a proposed going-private transaction led by Fertitta and its subsequent decision to unilaterally terminate the revised transaction. In July 2010, the case settled for a cash payment of $14.5 million.
The Alberto Culver Company is an innovative leader in consumer products in key markets around the world. Their product portfolio builds from a strong core of beauty and personal care brands and includes a group of innovative household products.
Case description: Challenged the terms of the proposed sale of Alberto-Culver to Unilever. Alleged Alberto-Culver board improperly structured the transaction to favor its preferred bidder (Unilever) and dissuade other interested parties from bidding.
Cypress was offered as expert witness on behalf of the court-appointed class plaintiffs regarding the fair value of Alberto-Culver. The case was settled in November 2010. As part of the settlement, Alberto-Culver agreed to eliminate the matching rights it had granted Unilever; lower any break-up fee Alberto-Culver may be obliged to pay by $25 million to $100 million; and promptly provide any superior bigger with the same confidential documents shared with Unilever.
WildBlue delivers affordable two-way broadband Internet access via satellite to virtually any home and small business in small cities and rural America. WildBlue Internet service for consumers includes typical Internet Service Provider features (email, web space, etc.). It opens up a window to a world of rich content that is largely unavailable through dial-up service and largely unavailable in areas unserved by cable modem or DSL service.
Case description: Alleged breaches of fiduciary duty, and appraisal as a result of WildBlue’s recapitalization.
Cypress was offered as an expert witness on behalf of the Defendant as to the valuation of WildBlue. The case settled.
Just Care, Inc. is a detention healthcare company that provides medical and mental health services. It offers sub-acute, intermediate, and hospice care for AIDS, cancer, cardiac disease, dialysis, life support, and mental health treatment, as well as special needs programs. The company serves county, state, and federal law enforcement agencies, as well as mental health organizations
The GEO Group, Inc. is the world’s leading provider of correctional detention, and residential treatment services with facilities located in the United States, United Kingdom, Australia, and South Africa. GEO is a leader in the delivery of private correctional and detention management, community re-entry services as well as behavioral and mental health services to government agencies worldwide.
Case description: Delaware appraisal action arising from the sale of Just Care to the GEO Group for $40 million
Cypress was offered as an expert witness on behalf of the Defendant as to the valuation of Just Care. The case was tried and the Chancery Court valued Just Care at $34.2 million. Cypress had valued the company in a range of $33.6 million to $34.1 million. The petitioner’s expert had valued it at $55.2 million.
Refco was a New York-based financial services company, primarily known as a broker of commodities and futures contracts.
Case description: Alleged fraud arising from secreting of hundreds of millions of dollars of uncollectible receivables to a related, unconsolidated entity controlled by Refco’s CEO.
Cypress acted as expert witness on behalf of RH Capital Associates LLC and Pacific Investment Management Company LLC regarding reasonableness of due diligence conducted by underwriters of Refco’s debt and equity securities.
