Vivendi has agreed to pay Liberty Media $775 (approx. €700) million in a settlement of a lawsuit filed by Liberty in March 2003 in the US related to the formation of Vivendi Universal Entertainment in May 2002.
In January 2013, following a jury verdict in favour of Liberty Media, the US District Court for the Southern District of New York awarded Liberty Media €945 million in damages and pre-judgment interest, an amount provisioned in Vivendi’s accounts.
An appeal and cross-appeal were subsequently filed by Vivendi and Liberty Media with the US Court of Appeals for the Second Circuit. The cross-appeal of Liberty Media sought €584 million in additional pre-judgment interest and, if Liberty had prevailed on that issue, would have increased the award to €1.529 billion (approx. $1.729 billion).
The case concerns the acquisition from Liberty of USA Networks in 2001. Liberty received about 37 million Vivendi shares, or about a 3.5% stake in the company. At the time, the deal was valued at more than $10 billion, but by the time Liberty sold its Vivendi shares in 2003, their value had slipped to about half.
In a statement Vivendi said “This settlement should not be construed as a concession by Vivendi of the validity of any of Liberty Media’s claims, or as an admission of any wrongdoing by Vivendi. Rather, despite the jury’s verdict, Vivendi continues to maintain that it did not commit any wrongdoing. Nevertheless, Vivendi is pleased to resolve this long-running dispute with Liberty Media on terms that Vivendi believes are in the interest of both the company and its shareholders.”
Said Liberty president and CEO Greg Maffei: “We are very pleased to announce a settlement of litigation with Vivendi, which resulted in a payment of $775 million, of which we will net after-tax proceeds of approximately $420 million.”