Richard Tofel, a former Wall Street JournalÂ assistant managing editorÂ and Dow Jones & Co. vice president, writes Thursday in the New York Sun that a proposed settlement of a lawsuit regarding News Corp.’s acquisition of Dow Jones leaves him baffled.
The settlement would pay lawyers nearly $1 million, but give shareholders nothing.
Tofel wrote, “Dow Jones declined to explain why it accepted the $895,000 in fees. Had they balked, the closing of the acquisition might have been delayed by the litigation, perhaps for months. So the tradeoff of settling a pesky lawsuit for less than a million dollars to speed closure of a $5 billion deal could well have seemed an attractive conclusion to a familiar game.
“And it is familiar. We know this situation â€” a ‘settlement’ on behalf of all shareholders that yields them little, and their lawyers a lot â€” isn’t unusual. But that doesn’t mean it’s in the public interest. It’s not.
“Of course, the attorneys’ fees in this case need to be approved by a justice of the New York State Supreme Court. Our letter is being delivered within the deadline for filing formal objections, although we are acting solely as journalists here. Maybe this case would be a good place to start bringing some reason to this arena.”
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