Case Caption: In re Madison Square Garden Entertainment Corp. Stockholders Litigation
Case Number: Consol. C.A. No. 2021-0468-KSJM
Court: Delaware Court of Chancery
Judge: Honorable Kathaleen St. J. McCormick
Plaintiffs: Hollywood Firefighters’ Pension Fund
Defendants: Madison Square Garden Entertainment Corp., James Dolan, Charles F. Dolan, Charles P. Dolan, Kristin A. Dolan, Marianne Dolan-Weber, Paul J. Dolan, Quentin F. Dolan, Ryan T. Dolan, Thomas C. Dolan, Martin Bandier, Matthew C. Blank, Joseph J. Lhota, Frederic V. Salerno, Brian G. Sweeney, John L. Sykes, Vincent Tese, and Isiah L. Thomas III
Overview: On May 27, 2021, Kessler Topaz initiated litigation on behalf of Hollywood Firefighters’ Pension Fund alleging that the merger between Madison Square Garden Entertainment Corp. (“MSGE”) and MSG Networks Inc.(“MSGN”) was unfair to MSGE and alleging certain statutory violations. Plaintiff alleged that the all-stock merger was unfair because it was consummated at an exchange ratio that overvalued MSGN’s declining cable television assets and was pursued purely at the behest of James Dolan, the controlling stockholder of each company, so that he could increase his ownership in MSGE and decrease his exposure to MSGN’s declining prospects.
Between May 2021 and March of 2023, the parties heavily litigated the action and engaged in extensive fact and expert discovery. The action was scheduled for trial beginning on April 10, 2023. On March 14, 2023, after extensive, arm’s-length negotiations and less than one month before the trial was set to begin, Plaintiff and Defendants reached an agreement to settle the action in exchange for an $85 million cash payment to MSGE.