News Releases

Delaware Chancery Court Victory for Liberty Media

Release

NEW YORK, April 29, 2011 -- Vice-Chancellor J. Travis Laster of the Delaware Chancery Court issued judgment today for Baker Botts client Liberty Media Corporation in litigation against The Bank of New York Mellon, as trustee under the indenture governing the public indebtedness of a Liberty subsidiary.

Liberty brought this action following threats made by bondholders that Liberty’s announced split-off of its Capital Group and Starz Group tracking stocks would violate the indenture by constituting a disposition of “all or substantially all” of the issuer’s assets, when taken together with prior spin-off transactions.

Following a three day trial and additional post-trial argument, the Court issued a 35-page opinion holding that the pending split-off does not violate the terms of the indenture. The Court rejected the trustee’s argument that, by aggregating three prior Liberty asset distributions occurring over a 7-year period, the pending split-off would trigger a default under the indenture.

Vice-Chancellor Laster reasoned that the current split-off is not “sufficiently connected” to the prior transactions so as to provide a basis for integrating all the transactions in conducting the analysis.

Baker Botts Litigation partner Rich Harper and Corporate partners Renee Wilm and Buzz McGrath (all of the New York office) led the litigation for Baker Botts, working closely with Delaware counsel, Potter Anderson & Corroon LLP. McGrath and Wilm are also lead corporate counsel on the pending split-off.

About Baker Botts L.L.P.
Baker Botts is an international law firm with over 725 lawyers and a network of 13 offices around the globe. Based on our experience and knowledge of our clients’ industries, we are recognized as a leading firm in the energy, technology and life sciences sectors. Throughout our 170-year history, we have provided creative and effective legal solutions for our clients while demonstrating an unrelenting commitment to excellence. For more information, please visit www.bakerbotts.com.

Practices

Related Professionals