Vivendi Universal (France)

Updated: December 19, 2014
Status: Ongoing Case
Labaton Sucharow represents clients as liaison counsel in a class action in France against Vivendi Universal (Vivendi), a French multinational mass media and telecommunication company headquartered in Paris, France.

The plaintiffs allege that Vivendi engaged in improper accounting practices and misled the market with false information regarding its financial health. From 2000 to 2001, the company spent approximately €600 billion to grow Vivendi through several acquisitions. When share prices began to fall in 2001, Vivendi suffered severe losses and cash flow problems. Despite this, Vivendi issued press releases throughout 2002 portraying cash flows as "excellent" and operating earnings better than the projections and ahead of targets. In July 2002, Vivendi admitted to a loss of €13.6 billion for 2001 and accumulated debts of €37 billion. For the financial year 2001-2002, Vivendi reported losses of €23.3 billion, which was the biggest corporate loss reported in French corporate history.

Originally brought in the U.S. District Court for the Southern District of New York in 2002, the Vivendi Universal class action is one of the many securities cases disrupted by the U.S. Supreme Court's decision in Morrison v. National Australia Bank, which severely limited the opportunities for recoveries for purchasers of securities outside of the U.S. marketplace, thereby revoking years of federal jurisprudence allowing these claims to proceed under the U.S. securities laws. In view of this negative consequence, many damaged investors that purchased ordinary shares of Vivendi from October 30, 2000 through August 14, 2002 elected to file actions in Europe.

The court is currently conducting hearings on procedure such as the timing and exchange of writs, briefs, and evidence in accordance with the procedural rules, and to rule on issues relating to questions Vivendi raised about the claimants' transactional data.