Former Vivendi Universal head Jean-Marie Messier appeared before a New York court Friday for his alleged role in deceiving about one million shareholders about the state of the company’s finances between 2000 and 2002.
Jean-Marie Messier, former CEO of media giant Vivendi Universal, stands accused of deceiving Vivendi shareholders about the group’s serious financial problems in 2001 and 2002. He appeared before a New York judge Friday for a class action suit covering about one million individual shareholders – about 60 percent of whom are French. Shareholders from the US, the UK and the Netherlands are also involved.
France 24 correspondent Emmanuel Saint-Martin said that it was unusual that a US judge would take on a case driven largely by foreign shareholders. Class action suits do not exist in France, though a bill to introduce them is in discussion and awaits a parliamentary vote.
False claims of financial health
Messier once had ambitions of conquering US media. In his capacity as chairman of a utility company Compagnie Générale des Eaux, he diversified the company to include the unlikely arena of media. This resulted in a multi-company merger that gave way to Vivendi Universal’s creation in 2000.
But Messier’s ambition exceeded his capability. His dreams of media domination were sunk when the company posted over 13 billion in losses between 2001 and 2002. Nonetheless, he stated in March 2002 that the group was in excellent financial health.
When his activities came to light, he was forced to leave Vivendi in July 2002 and was stripped of his €20 million-plus severance package.
Messier is likely to try to convince the jury that shareholders could have accessed the company’s books at any time.
The court’s ruling could result in Vivendi and Messier being held liable for billions of euros in damages. Everything depends on whether the company manages to convince a Paris court next Wednesday to call upon the French shareholders to drop the case.
Another fine mess
Messier has made a go at a normal life since the scandal. He runs a consultant company, Messier Partners, which counts among its clients such luminaries as Maurice Lévy, CEO of French company Publicis. Messier published a book in January, “The Day the Sky Fell,” where he explains that he invented a form of “well-tempered capitalism” that was both “responsible and ethical,” and that “placed the entrepreneur at the centre” by putting “finance in the service of the economy.”
However, Messier’s troubles are far from over. In addition to the class action suit, he faces five years in prison if the Paris court finds him guilty of spreading false or misleading information.
Date created : 2009-11-20