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Group Profile | Businesses |
Litigation
| Risk Factors
Section 3
Litigation
In the normal course of its business, Vivendi is subject to various
lawsuits, arbitrations and governmental, administrative or other
proceedings (collectively referred to herein as “Legal Proceedings”).
As of December 31, 2014, provisions recorded by Vivendi for all claims
and litigations amounted to €1,206 million, compared to €1,379 million
at December 31, 2013. Vivendi does not disclose details regarding
these provisions (save for some exceptions), as it believes that any such
disclosure could seriously harm its position.
To the Company’s knowledge, there are no Legal Proceedings or any facts
of an exceptional nature, including, to the Company’s knowledge, any
pending or threatened proceedings in which it is a defendant, which may
have or have had in the previous twelve months a significant impact on
the Company’s and on its group’s financial position, profit, business and
property, other than those described herein.
Vivendi Litigation
Securities Class Action in the United States
Since July 18, 2002, sixteen claims have been filed against Vivendi,
Messrs. Messier and Hannezo in the United States District Court for the
Southern District of New York and in the United States District Court for
the Central District of California. On September 30, 2002, the New York
court decided to consolidate these claims under its jurisdiction into a
single action entitled
In re Vivendi Universal S.A. Securities Litigation
.
The plaintiffs allege that, between October 30, 2000 and August 14,
2002, the defendants violated certain provisions of the US Securities
Act of 1933 and US Securities Exchange Act of 1934, particularly with
regard to financial communications. On January 7, 2003, the plaintiffs
filed a consolidated class action suit that may benefit potential groups
of shareholders.
On March 22, 2007, the Court decided, concerning the procedure for
certification of the potential claimants as a class (“class certification”),
that persons from the United States, France, England and the Netherlands
who purchased or acquired shares or American Depositary Receipts
(ADRs) of Vivendi (formerly Vivendi Universal SA) between October 30,
2000 and August 14, 2002, could be included in the class.
Following the class certification decision of March 22, 2007, a number
of individual cases were filed against Vivendi on the same grounds
as the class action. On December 14, 2007, the judge issued an order
consolidating the individual actions with the securities class action
for purposes of discovery. On March 2, 2009, the Court deconsolidated
the Liberty Media action from the class action. On August 12, 2009,
the Court issued an order deconsolidating the individual actions
from the class action.
On January 29, 2010, the jury returned its verdict. It found that
57 statements made by Vivendi between October 30, 2000
and August 14, 2002, were materially false or misleading and were made
in violation of Section 10(b) of the Securities Exchange Act of 1934.
Plaintiffs had alleged that those statements were false and misleading
because they failed to disclose the existence of an alleged “liquidity risk”
which reached its peak in December 2001. However, the jury concluded
that neither Mr. Jean-Marie Messier nor Mr. Guillaume Hannezo were
liable for the alleged misstatements. As part of its verdict, the jury found
that the price of Vivendi’s shares was artificially in ated on each day of
the class period in an amount between €0.15 and €11.00 per ordinary
share and $0.13 and $10.00 per ADR, depending on the date of purchase
of each ordinary share or ADR. Those figures represent approximately
half the amounts sought by the plaintiffs in the class action. The jury
also concluded that the in ation of the Vivendi share price fell to zero in
the three weeks following the September 11, 2001, tragedy, as well as
on stock exchange holidays on the Paris or New York markets (12 days)
during the class period.
On June 24, 2010, the US Supreme Court, in a very clear statement,
ruled, in the Morrison v. National Australia Bank case, that American
securities law only applies to “the purchase or sale of a security listed on
an American stock exchange”, and to “the purchase or sale of any other
security in the United States.”
In a decision dated February 17, 2011 and issued on February 22, 2011,
the Court, in applying the “Morrison” decision, confirmed Vivendi’s
position by dismissing the claims of all purchasers of Vivendi’s ordinary
shares on the Paris stock exchange and limited the case to claims of
French, American, British and Dutch purchasers of Vivendi’s ADRs on
the New York Stock Exchange. The Court denied Vivendi’s post-trial
motions challenging the jury’s verdict. The Court also declined to enter
a final judgment, as had been requested by the plaintiffs, saying that to
do so would be premature and that the process of examining individual
shareholder claims must take place before a final judgment could be
issued. On March 8, 2011, the plaintiffs filed a petition before the Second
Circuit Court of Appeals seeking to appeal the decision rendered on
February 17, 2011. On July 20, 2011, the Court of Appeals denied the
petition and dismissed the claim of purchasers who acquired their shares
on the Paris stock exchange.
In a decision dated January 27, 2012 and issued on February 1, 2012,
the Court, in applying the Morrison decision, also dismissed the claims of
the individual plaintiffs who purchased ordinary shares of the company
on the Paris stock exchange.
On July 5, 2012, the Court denied a request by the plaintiffs to expand
the class to nationalities other than those covered by the certification
decision dated March 22, 2007.
The claims process commenced on December 10, 2012, with the sending
of a notice to shareholders who may be part of the class. Recipients
of the notice had until August 7, 2013 to file a claim form and submit
documentation evidencing the validity of their claim. These claims
are currently being processed and verified by an independent claims
administrator and by the parties. Vivendi will then have the right to
challenge the merits of these claims. On November 10, 2014, at Vivendi’s
initiative, the parties filed a mutually agreed upon proposed order
requesting the Court to enter a partial final judgment on the January 29,
2010 jury verdict, covering a substantial portion of the claims. Certain
large claims were excluded from this proposed judgment order as Vivendi
continues to analyze whether to challenge the validity of those claims.
On December 23, 2014, the Court entered the partial judgment.
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Annual Report 2014