The former Maker Studios Inc. chief executive officer who last year accused the board of ousting him and taking control of the company through fraud is seeking to delay a shareholder vote on the acquisition by Walt Disney Co.
Danny Zappin and three other co-founders of Maker yesterday asked California state court judge in Los Angeles to block the April 15 vote because, they said, the notice to shareholders is misleading. They had sought a hearing as early as today. No hearing was held today, according to court staff.
Disney will pay as much as $950 million for the supplier of video content for Google Inc.’s YouTube, the Burbank, California-based entertainment company said last month. With more than 55,000 channels, 380 million subscribers and 5.5 billion views a month on YouTube, Maker is one of the top online-video networks for young audiences, Disney said.
The deal comes on the heels of several other acquisitions of multi-channel networks (MCNs). They include Time Warner's $18 million stake purchase in Machinima, a video game-focused YouTube MCN, as well as ProSiebenSat.1, which recently agreed to buy a 20 percent stake in Collective Digital Studio LLC, a Los Angeles MCN.
John Spiegel, a lawyer representing Culver City, California-based Maker, and Dean Kitchens, a lawyer representing the company’s board members, didn’t immediately respond to phone calls seeking comment on yesterday’s filing.
“Certain Maker directors illegally issued shares to themselves and diluted the common stock for their own financial gain to the detriment of other Maker shareholders and take control of Makers’ board so that they could rapidly create a liquidity event,” Zappin said in the filing.
The case is Katz v. Donovan, BC513284, California Superior Court, Los Angeles County.
(For more coverage on this continuing trend, see "The Buyside: Disney, Warner Bros. Seek Next-Gen YouTubes)