Former Vivendi toppers Jean-Marie Messier and Edgar Bronfman Jr. will go on trial June 2 in Paris, accused of insider trading, share price manipulation and misleading reporting related to the transformation of the utility company into a film, music and feevee conglom.
Messier, then CEO, plunged Vivendi into a buying spree in the late ’90s, paying $42 billion in 1999 to buy Bronfman’s Seagram, which included Universal Studios, MCA Records and USA Networks.
Charges relate to the 2000-02 period, when Vivendi management fought to shore up its stock price after the Internet bubble burst and allegedy hid massive debts.
Messier was ousted in August 2002. Bronfman served as Vivendi vice chairman 2000-03.
Trial, scheduled to last until June 25, caps seven years of investigations dating back to a 2002 probe.
In 2004, France’s Financial Market Authority fined Messier 1 million ($1.4 million), halved on appeal, for misleading investors over the level of Vivendi’s debt.
In October a French magistrate cleared the way for the June trial by overturning the Paris prosecutor’s earlier decision to throw the case against Messier and Bronfman out of court.
Meanwhile, a Manhattan district court jury is expected to rule soon on a massive class-action suit, involving some 1 million U.S., French, and other Vivendi investors, against Vivendi, Messier and former Vivendi finance director Guillaume Hannezo. They’re accused of misleading investors as to Vivendi’s financial health from 2000 to 2002.
Plaintiffs’ lawyer Arthur Abbey said that if Vivendi is found liable, damages could run up to $11.3 billion. Though Vivendi said it will appeal any sentence, its stock dropped 4.8% to $27.80 after Abbey’s comment.