A lone Berkshire Hathaway shareholder, Mason Kirby, is suing Warren Buffett, seemingly just for the hell of it.
Kirby’s lawsuit says he is suing Buffett because “in his haste to move quickly on the definitive merger agreement, Buffett failed to investigate Sokol’s holding of Lubrizol stock.”
According to him, Buffett was rash in his deal-making conversations with Evercore’s Chairman, Roger Altman, whose firm was a financial advisor for Lubrizol, says Kirby.
But Buffett’s conversations with Altman took place over more than a month, starting on February 27th, and ending on March 7th (the acquisition was publicly announced on March 14 2011). And they don’t sound that hasty.
According to the lawsuit, there were three conversations between Altman and Buffett.
- January 27, 2011 – Buffett called Roger Altman and indicated that Buffett was interested in having Berkshire acquire Lubrizol.
- February 8, 2011 – Altman called Buffett with a $140.00 per share in cash counter offer. Buffett told Evercore’s Chairman that Berkshire would not raise its offer above $135.00 per share.
- March 7, 2011 – Altman called Buffett to indicate that Lubrizol would accept an acquisition at $135 per share if Berkshire was willing and able to move quickly to sign definitive merger agreement. Buffett confirmed that Berkshire was willing and able to move quickly to signing a definitive merger agreement and that Berkshire Hathaway did not need to perform any further due diligence.
The lawsuit hones in on the last sentence “… and that Berkshire Hathaway did not need to perform any further due diligence,” and on the fact that Berkshire Hathaway’s share price will suffer.
Kirby also says that “it is rumoured that Berkshire has established an independent committee to investigate the Company’s corporate governance policies,” and the SEC is considering a formal investigation into Sokol’s trades, investigations that he claims will come at a substantial cost to the company.
But he’s not suing the firm for any amount of money, or asking for much of anything. His lawsuit says Kirby “has no adequate remedy at law” for the 2 counts, the first against Buffett for breaching his fiduciary duty and the second count against Sokol for disgorgement.
The relief Kirby asks for is simply that Buffett pay the amount of damages suffered because of his alleged breach back to Berkshire, and that Sokol pay Kirby’s legal fees.
The entire lawsuit is available for download by clicking here.
The question we’re wondering is, who is Mason Kirby? The most web-prominent man by the name is an architect based in California. But all we really know is he’s a Berkshire shareholder with either a lot of balls or no clue.
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