Duke Energy settlement indication of rise in merger & acquisition payouts

FRT Admin
Site administrator
March 30, 2015

In 2012, when Duke Energy merged with Progress Energy, the board of directors fired the new CEO, Bill Johnson, who was supposed to become the head of the merged companies. Shareholders claimed to lose millions after the ousting of the new CEO. The investors sued, claiming that they were misled and  Duke Energy has agreed to pay its shareholders $146 million to settle allegations due to the failure to disclose details of the merger. Investors who purchased Duke Energy shares within three weeks of the merger date or a week after it was finalized are eligible to participate in settlement.

duke-energy-logoDuke Energy denied the allegations and any wrongdoing as part of the settlement, which is pending approval by a federal judge. This case is a wakeup call to defendants that mergers and acquisitions don’t disappear with some quick payments to plaintiffs. According to this Business Journal article, securities litigation resulting from mergers and acquisitions are becoming more prevalent. There has been similar class action shareholder litigation of this magnitude, like the Activision Blizzard, Inc. settlement in November. While the frequency of high-valued M&A litigation has remained relatively constant, the available settlement dollars due to investors seems to be trending upwards, with 93% of such cases in 2014 valued over $100 million dollars.

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Founded in 2008, Financial Recovery Technologies (FRT) is a leading technology-based services firm that helps the investment community identify eligibility, file claims and collect funds made available in securities and other class action settlements. Offering the most comprehensive range of claim filing and monitoring services available, we provide best-in-class eligibility analysis, disbursement auditing and client reporting, and deliver the highest level of accuracy, accountability and transparency available. For more information, go to www.frtservices.com.

 

This communication and the content found by following any link herein are being provided to you by Financial Recovery Technologies (FRT) for informational purposes only and does not constitute advice. All material presented herein is believed to be reliable but FRT makes no representation or warranty with respect to this communication or such content and expressly disclaims any implied warranty under law. Opinions expressed in this communication may change without prior notice. Firms should always seek legal and financial advice specific to their unique situation and objectives.