Shareholders sue Computer Associates over deal to end proxy fight
The plaintiffs claimed they have been damaged because CA breached its obligations to its shareholders and caused damage to the company's stock and assets.
Two lawsuits were filed late last week after CA announced the deal with Sam Wyly, founder of Ranger. A derivative lawsuit is filed on behalf of the company by individual shareholders.
The lawsuits claim that the only reason CA paid the $10m to Ranger was so the directors would not lose their seats on the board or their executive positions with the company, and that they, therefore, were not impartial participants in the deal.
By reaching the agreement with Ranger, one of the lawsuits claimed, shareholders were deprived of their right to accept or reject the Ranger slate of directors.
The plaintiffs claim that the defendants breached their fiduciary responsibilities, and they are asking the court to rescind the deal and the payment.
Ranger's proxy battle was the second in as many years. CA has said that the previous battle with Ranger cost the company $12m (£7.7m) and took management time away from running the company. The company said the circumstances justified the $10m payment to Ranger and Wyly, who also agreed not to launch another proxy bid for the next five years.