Updated: January 23, 2019
Status: Settled Case
As co-lead counsel, Labaton Sucharow represents Norfolk Retirement System in a breach of fiduciary duty lawsuit against the board of directors and controlling stockholders of Clear Channel Outdoor Holdings, Inc. The action challenges the Clear Channel Board’s November 2017 decision to continue lending greater than $1 billion to Clear Channel’s controlling stockholder, iHeart Communications, Inc., at far-below-market interest rates that did not come close to reflecting iHeart’s dire financial condition and lack of credit worthiness.
On January 23, 2019, the court granted final approval of a settlement whereby upon the effective date of iHeart Media’s plan of reorganization, Clear Channel will be separated from iHeart. The settlement also includes a bankruptcy distribution of approximately $150 million, waiver of any unpaid post-petition royalties, complete transference of Clear Channel’s intellectual property back to the company, and a $200 million credit line from iHeart to Clear Channel.
The case is Norfolk County Retirement System v. Hendrix, et al., C.A. No. 2017-0930 (Del. Ch.).