Vivendi is being sued for €1 billion in damages in an action which alleges that the media giant made false statements during its merger with Seagram and Canal+ some two decades ago.
Ninety investors (represented by law firm Soffer Avocats) allege that top executives failed to fully disclose the total extent of Vivendi’s debt. The merger saw a $46 billion three-way tie-up with Seagram (which owned Universal Studios) and Canal+, according to Reuters.
Vivendi’s CEO at the time was Jean-Marie Messier, who was forced to resign from Vivendi in 2002, and not helped by allegedly using $17.5 million of Vivendi funds to buy a Park Avenue apartment in New York. Messier was put on trial in France in 2011 and was found guilty of misappropriation of company funds and divulging misleading information when he headed Vivendi. He appealed the decision, and in 2014 the court overturned Messier’s conviction on charges of misleading investors but upheld the conviction on charges of misuse of corporate funds.
“The investor group contends that Messier and other Vivendi executives presented fake financials to conceal the existence of a severe liquidity crisis at the company,” a spokesman for the investors’ group said in a written statement.
Vivendi’s lawyers deny the claim.
“This case has already been judged several times in France, in particular by the criminal judge, who ruled out that Vivendi issued any false information,” said Hervé Pisani, managing partner of Freshfields in Paris.