Judge William B. Chandler denied the request, filed by the Wayne County Employees’ Retirement System, which said the merger would put Activision investors in an “unfavorable minority position.” When the deal is completed, Vivendi will hold a controlling 52 percent stake in the newly-formed Activision-Blizzard.
Chandler, who according to the Wall Street Journal Law Blog has become “an undisputed LB star” for making various pop-culture references in his decisions, displayed an admirable knowledge of World of Warcraft, Blizzard’s hit MMOG that is widely viewed as the centerpiece of the merger. Opening with a description of the game, Chandler then wrote, “In some ways, perhaps, the world of Mergers and Acquisitions is a massively multiplayer role playing game as well. Like in World of Warcraft and other games, the participants in the M&A field take on certain roles, interact in their own community, hone specialized skills, and even develop a unique, somewhat curious vernacular. One particular quest in the world of M&A is disclosure litigation. In the instance of disclosure litigation presently pending before this Court, the world of M&A meets the World of Warcraft.”
After breaking down the case background into sections including “the characters” and “the plot,” Judge Chandler determined the plaintiff has shown insufficient cause for the injunction to be filed. “In the role-playing game that is this disclosure litigation, both sides have played their respective roles well. Plaintiff has vigorously battled for additional information about the proposed transaction, and, indeed, additional information has been released by the Company during the pendency of this litigation. Likewise, defendants have responsively and effectively addressed the many variations of claims that plaintiff has proffered. Ultimately, however, there still remained three outstanding disclosure claims for the Court to resolve. Like any game, this one has rules, and the most essential rule of disclosure is materiality. Because the plaintiff could not establish the materiality of its final three disclosure claims, the motion for a preliminary injunction is denied,” the judge wrote in his conclusion. “GAME OVER.”
Following the decision, Activision announced that a special meeting of its shareholders would take place on July 8 “to consider and vote on proposals to approve the transaction and related matters.” Pending shareholder approval, the company expects the transaction to be completely by July 9.
Judge Chandler’s decision can be read in its entirety here. (PDF format)