Former Dole general counsel and CEO found liable for $148M for undervalued buyout
A Delaware judge on Thursday found two Dole officials liable for $148 million for driving down the company’s stock price in a 2013 leveraged buyout.
Found liable were chief executive David Murdock, who was able to buy the business at a lower price, and then-general counsel C. Michael Carter, who was promoted to president and chief operating officer after the buyout, report Corporate Counsel, the Wall Street Journal (sub. req.), Delaware Online and the New York Times. Carter left Dole in April.
Several lawyers told the Wall Street Journal they believe the award is the second highest shareholder recovery in deal litigation.
Vice Chancellor J. Travis Laster said the executives drove down the stock price by canceling a stock buyback and underestimating savings from the sale of the company’s Asian operations. Yet the company gave more optimistic financial projects to lenders financing the buyout, Laster said.
Murdock, who already owned 40 percent of Dole shares, purchased the other 60 percent in the buyout. Plaintiffs in the case were former Dole shareholders.