News Corp Settles Shareholder Lawsuit
News Corp (NWSA.O) on Monday said it recovered a $139 million in insurance proceeds in a settlement with shareholders over the board of directors' actions related to the company's phone hacking scandal and its acquisition of Shine studios.
The company said the money would come from insurance policies held by members of the board who were the defendants in the suits.
News Corp also said it would adopt enhanced corporate governance procedures, which would stay in place after the company's pending split later this year.
The agreement said the settlement is not an admission of wrong doing by News Corp.
"We are pleased to have resolved this matter," News Corp said in a statement.
"The agreement reflects the important steps News Corporation has taken over the last year to strengthen our corporate governance and compliance structure and we have committed to building on those efforts going forward."
Plaintiffs, including Amalgamated Bank and the New Orleans Employees' Retirement System, first sued in March 2011 over News Corp's acquisition of Shine Group Ltd, a company owned by Chairman Rupert Murdoch's daughter.
They amended the lawsuit in July 2011 to add claims related to the phone hacking scandal, which led News Corp shut down its British newspaper News of the World.
"We are proud of this historic settlement, which continues the 20 year history of Amalgamated Bank encouraging corporate reform and improved corporate governance." Edward Grebow, president & CEO of Amalgamated Bank, said in a statement.
Central Laborers Pension Fund and the City of New Orleans Employees' Retirement System (NOMERS)Chairman Edgar Chase said in statement, "We are proud of the meaningful role that we and our counsel played in the Company's continuing efforts to strengthen its governance on behalf of our beneficiaries in achieving this recovery and further improving corporate governance practices at News Corporation."
The agreement represents one of the largest derivative settlements in Delaware.