Upper Deck Company has filed a lawsuit against Topps–which apparently isn’t holding a grudge. The two companies are still talking about a possible merger…we think.
Topps has revealed details of a lawsuit filed by Upper Deck and Topps shareholder Northwood Investors relating to the ongoing sale of the company. The suit says Topps breached a confidentiality agreement.
The lawsuit is aimed at stopping the June 28 shareholder vote on the sale of the oldest sports card manufacturer to Madison Dearborn Partners and Tornante Company.
Upper Deck’s initial attempt to negotiate with Topps shortly after a proposed sale to MDP/Tornante for $9.75 per share was rebuffed. Last month, UD submitted a $10.75 per share bid after Tornante allowed Topps to consider other offers, including a non-solicited inquiry from its California rival.
Upper Deck is charging that Topps "fraudulently induced Upper Deck into entering into the Confidentiality Agreement." The suit further states, "the Directors breached their fiduciary duties to the stockholders of the Company and Tornante and Madison Dearborn aided and abetted the Directors in the breach."
The lawsuit announcement was revealed in a filing with the Securities and Exchange Commission on Wednesday.
"This lawsuit shows that Upper Deck is serious about acquiring Topps but is being blocked by Eisner and the company’s management team," one angry shareholder told the New York Post.
A hearing is set for June 11.
However, Topps maintains it is still "continuing to engage in discussions and negotiations… relating to a possible acquisition" by Upper Deck.
Upper Deck’s complaint states "This action challenges a type of unlawful conduct which is occurring with greater frequency" in which "private equity funds have ‘persuaded’ management to take public companies private based on promises of continued employment and increased equity participation."