"With great power comes great responsibility," says the complaint. "Upon information and belief, members of Maker's Board of Directors, Mark Suster, Lisa Donovan, Ben Donovan, Rachel Lam, Dana Settle, and Michael DiSanto, unhappy with their inability to control Maker and/or obtain a quick return on their invested capital in Maker, orchestrated a scheme to illegally issue enough shares to themselves and those friendly to them that would be required to approve any sale."
Zappin has brought his own lawsuit alleging he was ousted from power, that other board members accelerated the vesting of share options, issued favorable employment agreements, and handed control to Ynon Kreiz. Last week, Zappin attempted to get a restraining order to stop Maker from voting on approval of the Disney deal. That motion was denied, and Maker said it had already approved the merger anyhow.
Faberlle's lawsuit (read here) is in some respect a follow-up.
"Defendants illegally obtained Maker shares and illegally voted those shares in favor of a merger with Disney," says the complaint. "Moreover, they sought to obtain approval of the Merger from the Maker shareholders without providing them the necessary information for approval of the Merger, even after repeated requests."
Last week, in response to Zappin's motion for a restraining order, Maker submitted an opposition that hints at how it will oppose Zappin's claims as well as foreshadowing how it will probably attempt to defeat Faberlle's.
Maker said that Zappin's legal action "rest[s] on the thesis that some anti-Zappin 'cabal' schemed to deprive Mr. Zappin of 'all of his powers.' In fact, the true facts are that Mr. Zappin, as a condition to a substantial investment by Greycroft Partners II, L.P., agreed not to serve as a director, and not to accept service if other shareholders elected him."
The digital studio added that "Mr. Zappin was not 'tricked' into giving up voting control at the time he resigned; he had no such control. Defendants Ben and Lisa Donovan combined had more shares than Mr. Zappin had. Thus, even if Mr. Zappin had forced a vote on his ouster, he could not have blocked it. In short, the premise of this action -- that Mr. Zappin needed to be defrauded in order to be removed -- is mistaken."
Maker also knocked what it says is the "bizarre theory" that Maker shareholders are being harmed by the Disney deal. "Other rational shareholders presumably are rejoicing at their good fortune," said Maker's opposition to a restraining order.
Faberlle isn't, but he could be in line for an attack on standing grounds. Maker's court papers in the Zappin lawsuit also discuss how post-merger, he will no longer be a Maker shareholder. Additionally, Maker asserted he couldn't do anything about the merger -- "both before and after" -- except to demand an appraisal of the company's fair market value and pursue damages that way.
Despite these arguments, Faberlie is going forward with a lawsuit that states, "Should the Merger be consummated during the pendency of this action, the Merger must be unwound."
This story first appeared on THR.com