Liberty Media Corp. has reason to celebrate. A U.S. federal jury yesterday awarded the U.S. cable operator nearly $1 billion in damages in a lawsuit it filed almost a decade ago against French entertainment group Vivendi SA.
In 2001, Vivendi bought the American cable TV channel USA Networks Inc. for about $10.3 billion. As part of the deal, Vivendi and Liberty Media entered an agreement in which Liberty Media swapped its stock in USA Network in exchange for a stake in Vivendi. But the Vivendi shares’ value quickly plummeted, and in 2003, Liberty Media sued Vivendi for fraud and breach of contract, claiming Vivendi executives made misleading statements about the company’s financial health prior to the agreement.
After a four-week trial in Manhattan, a federal jury found yesterday that Vivendi breached its contract with Liberty Media and must pay the company $954.6 million in damages.
In a statement, Vivendi said it “strongly disagrees” with the verdict and plans to appeal.
Meanwhile, Liberty Media said in a statement that although the award isn’t final until the judge rules on other issues, the company expects the judge to uphold the verdict if Vivendi appeals.