Delaware Court Rules For Diller In Liberty Fight: IAC Breakup Back On

Barry Diller has won the courtroom battle against Liberty Media and John Malone: ” The court concludes that Liberty has failed to demonstrate that Diller has breached or threatened to breach any contractual duty he owes to Liberty.” Translation: Barry can go back to his plans to bust up IAC (IACI) into five pieces.

The 79-page ruling from Delaware Chancery Court is below. As expected, it’s pretty effective Ambien, though we did like these two bits:

John Malone doesn’t love Greg Maffei so much : “It appears from the evidence that at least some people at Liberty subsequently formed the view that… Liberty could remove Diller as CEO and reassert control over its IAC shares. According to the evidence presented at trial, [Liberty CEO Greg] Maffei was the primary advocate of this position; Malone, in both his deposition and at trial, described the theory as “a stupid thing to litigate,” the result of “brain damage,” and “[in]consistent with what I’d been saying to the world for 10 years.”

Neither does Barry Diller: Maffei arranged for an October 8, 2007 meeting between Malone and a Wall Street Journal reporter. Maffei and the reporter flew on a company plane from New York to Liberty’s headquarters in Denver for the interview. Although the parties dispute what Maffei and Malone told the reporter, the end result is indisputable–the October 27 issue of the Journal carried a story announcing Diller and Malone’s “divorce.” Malone was quoted as saying that, while once there had been a market premium attributable to Diller’s management, now there was a “Barry discount.” The article ended with references to Maffei’s position that Liberty might be able to revoke Diller’s proxy, and Maffei’s comment that the status of the proxy much depended on whether “‘a bus gets’ Mr. Diller.”

Read this doc on Scribd: 3486 Memo Op

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