Hasta La Motion!

A class-action lawsuit has been filed against DreamWorks Animation CEO Jeffrey Katzenberg, according to a report by the Los Angeles Business Journal. A DWA minority shareholder Ann Arbor City Employees Retirement Systems filed the lawsuit seeking a share of the profits from an alleged side deal that took place as part of the $3.8 billion merger deal back in April.

The merger deal took place in april earlier this year when Comcast Corporation acquired DreamWorks Animation for the above mentioned amount. In fact, NBCUniversal, a division of Comcast Corporation was the major player who announced the merger deal.

Minority DWA shareholder Ann Arbor City Employees Retirement Systems (AACERS) has claimed that Katzenberg’s profit-sharing and consulting arrangement is an “extraordinarily valuable side deal” that allowed Comcast to secure a $41 a share price to acquire DreamWorks Animation. The complaint stated that Comcast would otherwise have been required to increase the merger price.

A report in the New York Post mentioned that the profit sharing arrangement which provides Katzenberg the right to receive 7 per cent of the joint venture entities profits in perpetuity is so valuable that it cannot credibly be characterised as compensation for a two-year consulting contract.

DreamWorks’ AwesomenessTV is currently valued at $650 million, according to the complaint, and the agreement will see Katzenberg paid 7 percent of profits “in perpetuity,” in addition to $41/share for his stake in DWA.

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