Activist Disney investor Blackwells Capital is suing the media giant over what it sees as an inappropriately cozy relationship with another shareholder, ValueAct Capital.In the lawsuit filed Thursday in Delaware Chancery Court (read it here), Blackwells lays out concerns about whether ValueAct has been paid to take a pro-Disney position in a brewing proxy fight with activists. Blackwells and Trian Fund Management have agitated for fresh voices on Disney’s board of directors ahead of Wednesday’s annual shareholder meeting, when ballots in board elections officially will be tallied.The lawsuit requests “books and records in order to determine whether wrongdoing, mismanagement, or breaches of fiduciary duty, including potential violations of disclosure obligations under the federal securities laws, have taken place.” Blackwells also maintains that ValueAct managed Disney pension funds from 2013-23, a fact that Disney neglected to disclose when proclaiming ValueAct’s support.The Blackwells complaint is rooted in a January 3 announcement by Disney. It touted ValueAct’s support for the company’s board nominees and management. In exchange, the company said it would “provide information to the investment firm and consult with ValueAct on strategic matters, including through meetings with the Disney Board and management.”A Disney spokesperson called the suit’s claims “baseless” and described the complaint as “merely their desperate attempt to gain attention for their slate of director candidates.” The spokesperson went on to assert, “No Disney pension plan funds are currently invested with ValueAct nor were they managing any Disney pension plan funds at the time of their entering into an information-sharing agreement with the company. Prior to Blackwells filing this litigation, Disney offered to meet with them and provide documentation confirming those facts, but Blackwells declined the meeting.”The legal clash comes after Blackwells publicly backed Chairman and CEO Bob Iger and the company’s official slate of board nominees on the same day as the ValueAct agreement last January. Unlike Trian, which has traded blows with Disney and repeatedly aired its critiques, Blackwells has reserved most of its ire for Trian and its leader, Nelson Peltz, even though it has proposed three alternate picks for the board.Shareholders already have begun casting votes for board candidates, with tens of millions spent by Trian and Disney to promote their rival perspectives. When votes are counted up next week, it is likely to go down as the most consequential Disney shareholder meeting in 20 years, regardless of the outcome.Shareholders have until 11:59 p.m. ET Tuesday to cast ballots, with the results revealed at the meeting, which will be conducted virtually and livestreamed on Disney’s investor relations website.
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