Midway shareholder suit settled
Creditor committee comes to agreement with Mark Thomas over stock transfer row
The main creditor committee of bankrupt US publisher, Midway Games, has announced it has settled a lawsuit with majority shareholder Mark Thomas, following his acquisition of the broken firm from Sumner Redstone for USD 100,000 in November last year.
The row erupted when the committee decided that deal was fraudulent and in breach of fiduciary duty, and named both Thomas and Redstone in the suit, according to a Bloomberg report.
But the suit has now been settled, with the committee to allow an affiliate of Thomas to collect up to USD 5 million before other creditors - although Thomas had originally been seeking USD 70 million.
The company filed for Chapter 11 bankruptcy in February, and recently received court approval for the sale of the Mortal Kombat franchise assets to Warner Bros in a USD 33 million deal.