See my thoughts below about the two-day hearing, coming up tomorrow.
It kicks off at 9:15am Eastern.
I’m going to test using this thread as a method of doing a kind of “live-thread” with intermittent updates. But it will not be a live-tweet experience.
If you want to follow along with everything for the two day hearing in real time, you should definite dial in for yourselves to listen, or be prepared to wait until it’s over to get my more coherent thoughts and reactions.
If you’d like to dial-in, just call one of these numbers to listen!
I have been saying for weeks that this footnote was going to come up again from an early opinion where she says, "HEY, y'all ... you don't have AMC named as a defendant, and they are providing the settlement consideration, and you are giving them a release." And, here we are.
In your opinion, is this one of the most error filled fillings by a law firm? I am not a lawyer , but know there would be butts on the line for these simple mistakes in my business.
We have resumed the hearing after the *literal* fire drill.
Plaintiff has restarted their presentation. I'm suddenly starving. The adrenaline double-hit is wearing off. Need caffeine.
Plaintiff will go until lunch, then defendants and Izzo's counsel after lunch, then the two objectors present thereafter. Ms. Izzo is also present in the courtroom.
Ok, everyone is in place and we are waiting on the Vice Chancellor to begin. I'm as ready as I'm ever going to be. I can't believe it's June 29th. This is really happening. Apparently, there are three people here to observe thus far. Props to the hard core who made it to Wilmington!
settlement hearings feel so weird, they all have to thread the needle that their case was great, but on the other hand it wasn't so great so settling for XYZ was justified. It felt for a giant chunk of this opening discussion that he was almost finding he needed to advocate against plaintiff's interests to get to the answers VCZ's questions would demand in order to approve the settlement.
Ok, so we are in recess until 10:45am. There was a fire alarm, I had to walk down 12 flights of stairs in heels, the emergency exit doors were all locked, lucky there was not a real emergency, we finally got ourselves out in a masterful escape, and then reentered the building, only to get back up to the 12th floor to learn that we would be in recess until 10:45am. To think I could still be sleeping...
I hope it was a family court issue and not someone trying to make retail investors look bad. Despite the colloquialism, it should be clear that ignorance is not bliss for everyone.
Guessing there are a lot of security cameras in a court house...fire alarms have been known to malfunction, but the timing of this is certainly curious.
I'd say Izzo's original formulation of the scope of the release claims weren't as strong as their subsequently honed one in the exceptions, but Zurn can still have all her own concerns about the scope of the release, which she obviously does.
I much appreciate your work on all of this! Thanks!
Just an overview question, which, perhaps, is not appropriate now... I am wondering when Zurn makes a ruling, assuming it is to allow the settlement to proceed, how long it then takes for the conversion to actually occur as there are some admin things that must be done (like the 10-day notice to the exchange, etc.). Any thoughts?
And I guess we can't tell yet, but I have to wonder how long it will take Zurn to arrive at her decision. I suppose that will depend somewhat on what we find out over the next couple of days.
Good luck and try to have fun with it! You are involved with something that people will be telling stories about for a very long time and you are in the thick of it!
Zurn said it will not happen this week. Chance said the DE norm for a written opinion is up to 90 days. My guess, speaking as a layman, with little knowledge of Chancery court, is the 2nd half of July. She has moved quickly in this case, and seems to understand the urgency for AMC (they are running out of money). But per Chance's commentary, she's a stickler for getting things right, and this opinion is likely to have value as a precedent, so my guess is she will think hard about what she says and how she says it. There are going to be a lot of eyes on this when it comes out.
Capt. John Barton. It kills me when you've got someone that actually might be a decent guy passionate about something SOO dumb. You just want to sit him down and explain his misperceptions in 20 minutes. So much misunderstanding and stupidity.
But gutsy to come out and speak up... that said, it is sad to see how out of depth he was here. End of the day, the law has to be the guide for how this plays out and not people's passions. This is a court still.
Thank you! This is accurate. No fire, no juvenile delinquent, stress on the system caused a bit of a failure; everyone is okay, we reconvene in thirty minutes.
What the objectors really mean to say: "I bought AMC at a price way too high and the only way I can recover is if there's a massive short squeeze. I've lost so much it's not that much more of a big deal if the company goes under. SO, I'd rather you cancel this deal and let's see which happens first: A squeeze or BK."
That’s not what I heard, I heard a dude say he got robbed and tried to support it with laws he didn’t really understand. And another who served the country who said we was also robbed and doesn’t think that’s fair or right or equitable.
If the Izzo objections are the cream of the crop for the Apes, it doesn't bode well. This is a lot of emotive appeals to justice with very little in the way of substance. Completely devoid of any awareness of the company's financial position and what it migt take to stay out of bankruptcy.
I believe the main objection made that has some merit is the scope of the release, but even that would require a restrictive reading of cases when you are weighing that against potential bankruptcy of the the company. So long as the release does not strictly violate DE Supreme Court precedent hard to see how the VC can use that to not sign off on the settlement.
Like maybe not wasting $25m on a gold mine that doesn’t mine gold or make any money? Or wasting$25m on an industrial commercial when Super Bowl commercials average $10m? Or creating and minting NFT’s? The guy wants more money so he can try to buy out cinemark and become the only option for movies in the USA
$25 m is chump change compared to their cash burn and debt. I just don't find much substance in it. If there was there would have been a lawsuit when it happened. It seems like ex post facto strawgrabbing that would be fodder for business judgement. Was it a shit choice? Absolutely. Is it really material to the current discussion? No.
In your opinion, sure, but clearly not in mine. And 50m isn’t immaterial, and given the debt was self inflicted, I think it is very relevant. If you cause self harm you can’t make yourself whole at the expense of a secured creditor. That’s antithetical to the idea of law.
The company lost 1 bil with a b last year. 25-50 m was not going to save it and yes the debt was self inflicted, but making poor business decisions isn't a cause of action here in the Court of Chancery nor anywhere else.
Beautiful human, I appreciate you so much, You’ve said you aren’t a lawyer, so if you don’t mind my asking, how would you know? There is in fact an actionable law that says corporations cannot just invest in random ass companies outside of their market of expertise. What does a prospective gold mine have to do with asses in seats or popcorn sales? And making poor business decisions isn’t a get out of fraud free card, at least not yet. What was van gorkham about? Serious question, because it seems like this is parallel to that. Their debt was intentionally incurred, because they know if they have all the box office receipts it will be paid off in 5 years or less unless they want to live in debt like many seem to.
Unfortunately, at the end of the day the VCZ has various levers to impede the settlement. If she is somehow persuaded by the sophistry, she can throw a curveball into the settlement given the slack around some of the issues involved.
That's not to say VCZ would do so consciously, but unfortunately it is human nature that is is possible that the color through which someone views a situation can influence how they decide for the ball to bounce on issues that have a range of "reasonable" outcomes.
I agree that there is a lot of sloppy lawyering around this case, not sure how much of it was just incompetence vs a lack of time to get all the details right, probably a little of both. But Zurn, based on Chance's description of her, does not seem to be one to fall for sophistry. I do think she wants to avoid the appearance that this was some kind of cozy deal that fundamentally wronged shareholders. The release seems to be the most problematic issue, and I'm not a lawyer, so I'm not going to guess on how she deals with that. She would do everyone a big favor if in her opinion she expounded on the financial realities of AMC's situation and what imperatives that presented. The apes in general have no conception of how tenuous the company's financial situation has been and how perilous that is to the value of their stock. There was (and remains) a fundamental tradeoff between dilution to sustain liquidity and cancellation of their stock in bankruptcy court, and that drum needs to be banged on loudly. There's way too much magical thinking around this stock.
Exactly. My take is the VC is trying to have the lawyers articulate the legal standards needed to approve the settlement, especially around the points she finds troublesome legally, so she can in-fact approve it and not that these challenges (as apes on twitter assume them to be) are her attempt to undermine the settlement.
Agree, the apes did nothing to further their case based on what I heard. The release would have been tricky in almost any case given the nature of the transaction and the hinky facts around the plaintiffs aren't making that any easier. You can see AMC not wanting to get sued again for this, but releasing things like securities law violations seems pretty broad.
So long as DE law supports such a release language can't see it being an issue. It should be noted that it is very likely such a release would not hold merit in Federal Court in any case, but that is not the DE courts concern here as any weakness in a release here is hurting the Director defendants (i.e. because they can still be sued for it) who the court has no fiduciary duty to.
Izzo counsel repeating another blatant fallacy, that the common shareholders as a group were against the vote. The final vote had 70% of voting common shareholders voting to approve, and Defendant's brief indicated that the pulled votes also had more than 50% of voting common shareholders voting to approve the conversion.
“At the time of tabulation before the two proposals were withdrawn, the majority of shares that voted had voted in favor of each of the proposals to authorize more Common Stock.31”
“The proposal to increase authorized shares received support from 88% of the voted shares and units (including 72% of the voted Common Stock and 91% of the voted APEs), and the proposal to effect a reverse stock split received support from 86% of the voted shares and units (including 70% of the voted Common Stock and 91% of the voted APEs).56”
Pound the table when the facts and law are not on your side. Izzo counsel had few points that I personally thought had some merit but overall seemed much more about his passion than any sustainable legal issues.
A lot of that has to do with they have no good avenue to attack the fact that AMC goes to Delaware Bankruptcy Court if this fails. All they can really do at that point, even with good arguments, is pound the table. It sucks because I'm not necessarily opposed to the issues raised here but the game seems to be play willfully ignorant of bad facts for their case or do the best they can to spin them.
Izzo's counsel continually repeats the fallacy that simply "squeezing" a stock somehow improves the company's actual underlying economic situation. It is only from the raising of capital by issuance of new stock at high prices that the company was actually "saved."
I would go further and say that even the plaintiff attorney overstates the short squeeze here. Short Interest data shows that from beginning of 2021 to when the price went way up, short interest increased overall, not decreased. A short squeeze would have to be the result of a drastic reduction in short interest.
Perhaps the most likely explanation for the share price increase and AMC raising funds was simply a buying frenzy by the apes.
Regardless, this is all speculative stuff that no one can likely prove one way or another, so while it makes for a nice sounding story, really hard to see how a court could consider this.
Refreshing to hear Plaintiff's counsel admit what was obvious from the beginning, that their claim was largely a bluff to extract value (i.e. attorney fees), with knowledge that holding up the conversion would put the company at risk of bankruptcy. Of course it would have been suicidal to actually obtain a permanent injunction.
I am wondering if the judge has only two choices: approve or not approve the settlement. Or can there be some kind of adjustment to the settlement in some way that could be agreed upon by the parties and then approved - for example, the release could be amended. How does it work?
From what I understood from Chance's previous posts, those are the only two choices, and any amendments that need to be made will get us back to square one
Not aware of any Delaware precedent. But "Courts have held that where amendments to a proposed settlement expand or improve rights for the class, new notice may not be required." Childs v. United Life Ins. Co., 10-CV-23-PJC, 2012 WL 1857163, at *5 (N.D. Okla. May 21, 2012). See also Knuckles v. Elliott, No. 15-10175, 2016 WL 3912816, at *6 (E.D. Mich. July 20, 2016) (granting final approval of class action settlement without requiring another round of notice or another fairness hearing even though the parties had amended the settlement agreement after the fairness hearing because the amended agreement did not adversely affect class members' rights).
Hopefully we can keep the comments here to those that are directly germane to the hearing. There are a lot of other venues out there for broader AMC related topics.
Theses are direct reactions to the hearing so I’m not sure how much more “Germaine” to the hearing you think they should be, or how that would even be possible.
My spidey sense tells me VCZ is going to ultimately rule to approve a settlement (perhaps with minor modification) and allow the transaction to close. I think its clear to her that the company really requires it to avoid financial calamity. And there even is a possibility that business judgement rule applies, though I do think it is more likely she would view enhanced scrutiny under Blasius or Unocal as applying (though not barring the actions of the board).
Ultimately as long as there is no strong precedent against any of the terms it would seem the liquidity concerns strongly outweigh the factors against approving settlement.
Like what is the alternative here? No settlement and company goes into bankruptcy resulting in everyone losing.
Or like Kittila suggests some bigger benefit should have been negotiated? As if implying the claims are so strong that the APE issuance itself should be questioned, which would mean the funds raised should be backed out of the financials and essentially you already have a bankrupt company that cannot pay anything to shareholders in a lawsuit in any case. There is simply no greater award to shareholders here unless you think a permanent injunction that triggers bankruptcy is a better result.
Which just gets back to the point that unless the precedent strongly weighs against this settlement it simply has to be approved. Would love to understand how a judge could rule otherwise and suggest she has any sort of business judgement at play here.
her business judgement applies in determining whether settlement is fair. In assessing that, she has to assess the give vs get, which implies valuing the claims. Part of that analysis is assessing the strength of the claims, which would include the strength of the Blasius (fiduciary) claim. The analysis of the Blasius claim involves assessing whether the board's actions get the deference of the business judgement rule or enhanced scrutiny under Blasius. Even if Blasius applied, board almost certainly had a compelling justification (threat of bankruptcy).
The back and forth today implied that she was wrestling with how to determine whether either Unocal or Blasius apply in light of the recent Coster decision.
My guess is someone stacked the roster with no shows to make people feel like their voices would assuredly be expressed by someone of them, kind of like the rigged vote that “approved” APE in the first place
Does anyone know if the phone lines are all filled up? I hope my running commentary to myself isn’t urk’n NE1 it’s just so much Mor cathartic than smacking my head against a wall.
Does anyone know how the defendants responded to Zurn’s concerns that the class definition was defined too broadly and confusingly? Did they end up saying something like anyone who owned the stock as of a recent date, regardless of acquisition date and duration of ownership?
I also wish all the objectors had shown up. I would have loved nothing more than to laugh at the ape ramblings about synthetics and naked shorts and dark pools. I would have listened extra close to see if I could hear Zurn cracking up behind her stifling hand.
Just following this string, but I have held AMC since 2016 and added along the way. I haven't sold any of the APE. I think it odd someone would sell something that ultimately was shorted down to levels in 2019-2020 when they were struggling. Just my two cents.
This is the first time I’ve ever listened to a corporate court case, so Is it just me or does this guy sound like Sarah plain trying to answer a simple question?
Just listen to the words comming out your own mouth dude, 6.4m get div by 3.8m receivers is NO BUENO just on the math, not even on principle. 2 each. As if that is going to compensate for 5 billion dilution
Dude, they straight stole our ownership position and gave it to people who agreed to do your bidding, and that bidding was enforceable as eyes were wide open
I have been saying for weeks that this footnote was going to come up again from an early opinion where she says, "HEY, y'all ... you don't have AMC named as a defendant, and they are providing the settlement consideration, and you are giving them a release." And, here we are.
In your opinion, is this one of the most error filled fillings by a law firm? I am not a lawyer , but know there would be butts on the line for these simple mistakes in my business.
Somebody's got a lot of attorneys' fees on the line based on who can be a plaintiff here. 😂
We have resumed the hearing after the *literal* fire drill.
Plaintiff has restarted their presentation. I'm suddenly starving. The adrenaline double-hit is wearing off. Need caffeine.
Plaintiff will go until lunch, then defendants and Izzo's counsel after lunch, then the two objectors present thereafter. Ms. Izzo is also present in the courtroom.
#AMC
Ok, everyone is in place and we are waiting on the Vice Chancellor to begin. I'm as ready as I'm ever going to be. I can't believe it's June 29th. This is really happening. Apparently, there are three people here to observe thus far. Props to the hard core who made it to Wilmington!
My god, today feels infinitely long.
settlement hearings feel so weird, they all have to thread the needle that their case was great, but on the other hand it wasn't so great so settling for XYZ was justified. It felt for a giant chunk of this opening discussion that he was almost finding he needed to advocate against plaintiff's interests to get to the answers VCZ's questions would demand in order to approve the settlement.
Ok, so we are in recess until 10:45am. There was a fire alarm, I had to walk down 12 flights of stairs in heels, the emergency exit doors were all locked, lucky there was not a real emergency, we finally got ourselves out in a masterful escape, and then reentered the building, only to get back up to the 12th floor to learn that we would be in recess until 10:45am. To think I could still be sleeping...
I hope it was a family court issue and not someone trying to make retail investors look bad. Despite the colloquialism, it should be clear that ignorance is not bliss for everyone.
Good thing indeed, that’s mad sketchy, if they’re worried about infiltration they should post guards not lock emergency exits
Guessing there are a lot of security cameras in a court house...fire alarms have been known to malfunction, but the timing of this is certainly curious.
We have the Vice Chancellor and her clerks, we are just about finished with introductions. We are right on time.
Plaintiff is starting their rebuttal now. #AMC
The hearing schedule has changed. We're doing rebuttals this morning.
We're talking about Coster, a recent decision from the Delaware Supreme Court.
I do wish the judge had asked Izzo's attorney questions. That would have clarified her thoughts on his appeal.
I'd say Izzo's original formulation of the scope of the release claims weren't as strong as their subsequently honed one in the exceptions, but Zurn can still have all her own concerns about the scope of the release, which she obviously does.
It really seems the majority of the arguments I've heard have been trying to justify the fees.
I much appreciate your work on all of this! Thanks!
Just an overview question, which, perhaps, is not appropriate now... I am wondering when Zurn makes a ruling, assuming it is to allow the settlement to proceed, how long it then takes for the conversion to actually occur as there are some admin things that must be done (like the 10-day notice to the exchange, etc.). Any thoughts?
And I guess we can't tell yet, but I have to wonder how long it will take Zurn to arrive at her decision. I suppose that will depend somewhat on what we find out over the next couple of days.
Good luck and try to have fun with it! You are involved with something that people will be telling stories about for a very long time and you are in the thick of it!
I would like to hear any guesses on this as well. When are we actually expecting her to rule?
Zurn said it will not happen this week. Chance said the DE norm for a written opinion is up to 90 days. My guess, speaking as a layman, with little knowledge of Chancery court, is the 2nd half of July. She has moved quickly in this case, and seems to understand the urgency for AMC (they are running out of money). But per Chance's commentary, she's a stickler for getting things right, and this opinion is likely to have value as a precedent, so my guess is she will think hard about what she says and how she says it. There are going to be a lot of eyes on this when it comes out.
Chase,
Are you going to wait until the end of this proceeding to give your synopsis of the case? Thank you
I'll be writing something up for next week with my thoughts.
Thanks for the clarification. Have a great 4th of July weekend! R, Chris
Capt. John Barton. It kills me when you've got someone that actually might be a decent guy passionate about something SOO dumb. You just want to sit him down and explain his misperceptions in 20 minutes. So much misunderstanding and stupidity.
But gutsy to come out and speak up... that said, it is sad to see how out of depth he was here. End of the day, the law has to be the guide for how this plays out and not people's passions. This is a court still.
Any idea Why did the defense atty say like five words about picking up where he left off and is now silent again?
That was the Plaintiff's attorney.
Weird, he sounds like the defense.
Someone pulled a fire alarm. Court in recess for the moment
Is there a fire or just a juvenile delinquent?
See Chance's comment above...no fire...adjourned until 10:45.
Thank you! This is accurate. No fire, no juvenile delinquent, stress on the system caused a bit of a failure; everyone is okay, we reconvene in thirty minutes.
Very cool to have you trying this forum out like this for the hearing (mostly cause it allows me to avoid the hellsite next few days)!
Twitter is the Friendster of the coming internet, bring on bluesky
Morninggggg 🥱
I feel that. Just got woken up by the bailiff's introductory speech though. 🫡
What the objectors really mean to say: "I bought AMC at a price way too high and the only way I can recover is if there's a massive short squeeze. I've lost so much it's not that much more of a big deal if the company goes under. SO, I'd rather you cancel this deal and let's see which happens first: A squeeze or BK."
That’s not what I heard, I heard a dude say he got robbed and tried to support it with laws he didn’t really understand. And another who served the country who said we was also robbed and doesn’t think that’s fair or right or equitable.
I heard that, too. Would you be less moved if instead of buying AMC at nosebleed levels, they'd put their money on green and it didn't hit?
If the Izzo objections are the cream of the crop for the Apes, it doesn't bode well. This is a lot of emotive appeals to justice with very little in the way of substance. Completely devoid of any awareness of the company's financial position and what it migt take to stay out of bankruptcy.
I believe the main objection made that has some merit is the scope of the release, but even that would require a restrictive reading of cases when you are weighing that against potential bankruptcy of the the company. So long as the release does not strictly violate DE Supreme Court precedent hard to see how the VC can use that to not sign off on the settlement.
The scope of the give get is hogwash if the take is ignored
Like maybe not wasting $25m on a gold mine that doesn’t mine gold or make any money? Or wasting$25m on an industrial commercial when Super Bowl commercials average $10m? Or creating and minting NFT’s? The guy wants more money so he can try to buy out cinemark and become the only option for movies in the USA
$25 m is chump change compared to their cash burn and debt. I just don't find much substance in it. If there was there would have been a lawsuit when it happened. It seems like ex post facto strawgrabbing that would be fodder for business judgement. Was it a shit choice? Absolutely. Is it really material to the current discussion? No.
In your opinion, sure, but clearly not in mine. And 50m isn’t immaterial, and given the debt was self inflicted, I think it is very relevant. If you cause self harm you can’t make yourself whole at the expense of a secured creditor. That’s antithetical to the idea of law.
The company lost 1 bil with a b last year. 25-50 m was not going to save it and yes the debt was self inflicted, but making poor business decisions isn't a cause of action here in the Court of Chancery nor anywhere else.
Beautiful human, I appreciate you so much, You’ve said you aren’t a lawyer, so if you don’t mind my asking, how would you know? There is in fact an actionable law that says corporations cannot just invest in random ass companies outside of their market of expertise. What does a prospective gold mine have to do with asses in seats or popcorn sales? And making poor business decisions isn’t a get out of fraud free card, at least not yet. What was van gorkham about? Serious question, because it seems like this is parallel to that. Their debt was intentionally incurred, because they know if they have all the box office receipts it will be paid off in 5 years or less unless they want to live in debt like many seem to.
Unfortunately, at the end of the day the VCZ has various levers to impede the settlement. If she is somehow persuaded by the sophistry, she can throw a curveball into the settlement given the slack around some of the issues involved.
That's not to say VCZ would do so consciously, but unfortunately it is human nature that is is possible that the color through which someone views a situation can influence how they decide for the ball to bounce on issues that have a range of "reasonable" outcomes.
I agree that there is a lot of sloppy lawyering around this case, not sure how much of it was just incompetence vs a lack of time to get all the details right, probably a little of both. But Zurn, based on Chance's description of her, does not seem to be one to fall for sophistry. I do think she wants to avoid the appearance that this was some kind of cozy deal that fundamentally wronged shareholders. The release seems to be the most problematic issue, and I'm not a lawyer, so I'm not going to guess on how she deals with that. She would do everyone a big favor if in her opinion she expounded on the financial realities of AMC's situation and what imperatives that presented. The apes in general have no conception of how tenuous the company's financial situation has been and how perilous that is to the value of their stock. There was (and remains) a fundamental tradeoff between dilution to sustain liquidity and cancellation of their stock in bankruptcy court, and that drum needs to be banged on loudly. There's way too much magical thinking around this stock.
Exactly. My take is the VC is trying to have the lawyers articulate the legal standards needed to approve the settlement, especially around the points she finds troublesome legally, so she can in-fact approve it and not that these challenges (as apes on twitter assume them to be) are her attempt to undermine the settlement.
Agree, the apes did nothing to further their case based on what I heard. The release would have been tricky in almost any case given the nature of the transaction and the hinky facts around the plaintiffs aren't making that any easier. You can see AMC not wanting to get sued again for this, but releasing things like securities law violations seems pretty broad.
So long as DE law supports such a release language can't see it being an issue. It should be noted that it is very likely such a release would not hold merit in Federal Court in any case, but that is not the DE courts concern here as any weakness in a release here is hurting the Director defendants (i.e. because they can still be sued for it) who the court has no fiduciary duty to.
You mean the self inflicted debt? Incurred trying to monopolize the film exhibition industry? That situation?
Even if that were true, how is that relevant to this proceeding?
Izzo counsel repeating another blatant fallacy, that the common shareholders as a group were against the vote. The final vote had 70% of voting common shareholders voting to approve, and Defendant's brief indicated that the pulled votes also had more than 50% of voting common shareholders voting to approve the conversion.
From Defendants’ brief:
“At the time of tabulation before the two proposals were withdrawn, the majority of shares that voted had voted in favor of each of the proposals to authorize more Common Stock.31”
“The proposal to increase authorized shares received support from 88% of the voted shares and units (including 72% of the voted Common Stock and 91% of the voted APEs), and the proposal to effect a reverse stock split received support from 86% of the voted shares and units (including 70% of the voted Common Stock and 91% of the voted APEs).56”
It is a major error of both Plaintiff and Defendant's counsel to not hammer this point.
Pound the table when the facts and law are not on your side. Izzo counsel had few points that I personally thought had some merit but overall seemed much more about his passion than any sustainable legal issues.
A lot of that has to do with they have no good avenue to attack the fact that AMC goes to Delaware Bankruptcy Court if this fails. All they can really do at that point, even with good arguments, is pound the table. It sucks because I'm not necessarily opposed to the issues raised here but the game seems to be play willfully ignorant of bad facts for their case or do the best they can to spin them.
Izzo's counsel continually repeats the fallacy that simply "squeezing" a stock somehow improves the company's actual underlying economic situation. It is only from the raising of capital by issuance of new stock at high prices that the company was actually "saved."
I would go further and say that even the plaintiff attorney overstates the short squeeze here. Short Interest data shows that from beginning of 2021 to when the price went way up, short interest increased overall, not decreased. A short squeeze would have to be the result of a drastic reduction in short interest.
Perhaps the most likely explanation for the share price increase and AMC raising funds was simply a buying frenzy by the apes.
Regardless, this is all speculative stuff that no one can likely prove one way or another, so while it makes for a nice sounding story, really hard to see how a court could consider this.
Refreshing to hear Plaintiff's counsel admit what was obvious from the beginning, that their claim was largely a bluff to extract value (i.e. attorney fees), with knowledge that holding up the conversion would put the company at risk of bankruptcy. Of course it would have been suicidal to actually obtain a permanent injunction.
BREAKING: VCZ orders AMC shorts to cover.
LOL!!! can you imagine? This guy is so misguided.
I am wondering if the judge has only two choices: approve or not approve the settlement. Or can there be some kind of adjustment to the settlement in some way that could be agreed upon by the parties and then approved - for example, the release could be amended. How does it work?
From what I understood from Chance's previous posts, those are the only two choices, and any amendments that need to be made will get us back to square one
Not aware of any Delaware precedent. But "Courts have held that where amendments to a proposed settlement expand or improve rights for the class, new notice may not be required." Childs v. United Life Ins. Co., 10-CV-23-PJC, 2012 WL 1857163, at *5 (N.D. Okla. May 21, 2012). See also Knuckles v. Elliott, No. 15-10175, 2016 WL 3912816, at *6 (E.D. Mich. July 20, 2016) (granting final approval of class action settlement without requiring another round of notice or another fairness hearing even though the parties had amended the settlement agreement after the fairness hearing because the amended agreement did not adversely affect class members' rights).
Thanks - I would be interested in hearing Chance’s thoughts on this
Hopefully we can keep the comments here to those that are directly germane to the hearing. There are a lot of other venues out there for broader AMC related topics.
Theses are direct reactions to the hearing so I’m not sure how much more “Germaine” to the hearing you think they should be, or how that would even be possible.
My spidey sense tells me VCZ is going to ultimately rule to approve a settlement (perhaps with minor modification) and allow the transaction to close. I think its clear to her that the company really requires it to avoid financial calamity. And there even is a possibility that business judgement rule applies, though I do think it is more likely she would view enhanced scrutiny under Blasius or Unocal as applying (though not barring the actions of the board).
Ultimately as long as there is no strong precedent against any of the terms it would seem the liquidity concerns strongly outweigh the factors against approving settlement.
Like what is the alternative here? No settlement and company goes into bankruptcy resulting in everyone losing.
Or like Kittila suggests some bigger benefit should have been negotiated? As if implying the claims are so strong that the APE issuance itself should be questioned, which would mean the funds raised should be backed out of the financials and essentially you already have a bankrupt company that cannot pay anything to shareholders in a lawsuit in any case. There is simply no greater award to shareholders here unless you think a permanent injunction that triggers bankruptcy is a better result.
Which just gets back to the point that unless the precedent strongly weighs against this settlement it simply has to be approved. Would love to understand how a judge could rule otherwise and suggest she has any sort of business judgement at play here.
her business judgement applies in determining whether settlement is fair. In assessing that, she has to assess the give vs get, which implies valuing the claims. Part of that analysis is assessing the strength of the claims, which would include the strength of the Blasius (fiduciary) claim. The analysis of the Blasius claim involves assessing whether the board's actions get the deference of the business judgement rule or enhanced scrutiny under Blasius. Even if Blasius applied, board almost certainly had a compelling justification (threat of bankruptcy).
The back and forth today implied that she was wrestling with how to determine whether either Unocal or Blasius apply in light of the recent Coster decision.
No clue in the slightest if "give them shares!" instead of cash for fees would be kosher, but it sure would be funny.
Would be poetic justice here, but is very far-fetched at best.
Mr Brogan takes on Harvard law. It suck’s 8 people didn’t show up. That shits weak.
My guess is that these two were the best of the bunch.
My guess is someone stacked the roster with no shows to make people feel like their voices would assuredly be expressed by someone of them, kind of like the rigged vote that “approved” APE in the first place
and... there it is: dark pool. looooove it. too funny
It's not funny...a bit sad.
If only Rickey Brogan had a grandson he trusted in the business that could explain reality to him.
I am curious why this objector placed such emphasis on 'wait the full 90 days'.
I wouldn't be surprised even a little, if he was handpicked by someone with a large short put position.
yeah, definitely was a little odd. Sophisticated players in the options could make a bundle if they knew the decision would take that long.
Not sure it would be so easy...
That is also curious to me as well she should take as long as she needs she seems pretty awesome
Rose Izzos guy already sounds better than Plaintiffs hungover counsel.
He's just even more cynical than a typical securities class action lawyer. He wants to threaten bankruptcy to extract more attorney fees.
Exactly!
They stabbed us in the nether regions while smiling in our faces
And retaliation for not approving their insane “compensation”
Did they all initial the purchase and deposit agreements? Van gorkham
This guy is way better at public speaking than the other dude.
Yeah it do
And conversion
Does anyone know if the phone lines are all filled up? I hope my running commentary to myself isn’t urk’n NE1 it’s just so much Mor cathartic than smacking my head against a wall.
What’s your take on the hearing ?
Does anyone know how the defendants responded to Zurn’s concerns that the class definition was defined too broadly and confusingly? Did they end up saying something like anyone who owned the stock as of a recent date, regardless of acquisition date and duration of ownership?
They clarified that it was anyone that owned between issuance of APE and record date for conversion.
Thanks! They have to have held for the entire duration?
Oh yes, sorry. Anyone who bought in between those dates and held through conversion.
Izzo counsel def gives a bit of a slimy vibe.
Izzo counsel giving such a moving speech about egregious fees. I am sure he would be willing to take this case pro bono.
Nah, his last words were about him wanting to take over the lead of the class action (in other words he wants the legal fee award here).
Clears throat: uh, Beyond Burger is like 40% sold short, is it a lecheif play? Short, sue, sell, print? Or are y’all just 9 figure ambulance chasers?
Speak up son, I say, I said Speak into the mic boy, no one can hear you
This court is so different it should be a tv show written by Arron sorkin
Izzos guy is the best speaker
Slide show! Slide show! Slide show!
Awwwwwe no slide show 🥲
Capt Barton, we salute you. But a share count doesn’t mean anything because it’s digital and can be fussed with super easy.
I also wish all the objectors had shown up. I would have loved nothing more than to laugh at the ape ramblings about synthetics and naked shorts and dark pools. I would have listened extra close to see if I could hear Zurn cracking up behind her stifling hand.
Just following this string, but I have held AMC since 2016 and added along the way. I haven't sold any of the APE. I think it odd someone would sell something that ultimately was shorted down to levels in 2019-2020 when they were struggling. Just my two cents.
Izzo was allegedly long term holder, but apparently sold her APE shares, represent half her interest in the company? Do we know that to be true?
100/1 reverse APE back into class A preferred.
Fraud is a crime in all the states including Delaware
It was a stock split they lied and said it wasn’t, that’s fraud fool
You stole 2/3 of the company and are providing 1% restitution
No Justice NO PLEBES
100/1 reserves APae back into Preffered and all will be right with the world
It’s particularly unfair and harmful to STEAL 2/3 of a company and “give” 1% restitution
What the fuss? they just hung up on me, are there only like 10 people called in so they’re condensing lines? Expletive, expletive, stuff and things
Mike check good!
This really is like the Super Bowl.
My minds eye has this guy looking a bit disheveled with somewhat tamed wild hair
I should have been a lawyer, but my sailor mouth prohibits that and teaching
He also sounds a little hung over
This is the first time I’ve ever listened to a corporate court case, so Is it just me or does this guy sound like Sarah plain trying to answer a simple question?
It's ... not ... the best oral argument you'll hear in Chancery.
Inadequate representation said wtf bro, did you answer the question? 6.9 / 4 = dookie
Don’t have to pay for? What’s the 1.5b dilutin take that brings us here today bruv
Ape shouldn’t have vited
Voted
I hope Izzos guys is better than this guy
Just listen to the words comming out your own mouth dude, 6.4m get div by 3.8m receivers is NO BUENO just on the math, not even on principle. 2 each. As if that is going to compensate for 5 billion dilution
Bernie Madoff would also call his noise Financial Engineering
ZURN for President smart women rule
The second it hit the market APE tanked, I never had an opportunity to sell them for more that “they cost”
Than
The easiest way to lie is with statistics
Dude, they straight stole our ownership position and gave it to people who agreed to do your bidding, and that bidding was enforceable as eyes were wide open
You have a brophy and schnell claims
Van Gorkham said what?
I would have bought preferred, APE is garbage
Lol OMG good things? Like buying a gold mine because that has anything to do with asses in seats or popcorn sales