Activision co-founder Howard Marks has agreed to pay $18 million to resolve a long-running defamation lawsuit brought by LRN Corp. Chairman Dov Seidman and two company directors, according to a filing in Delaware Superior Court.
The settlement ends nearly six years of litigation tied to statements Marks made as a putative class representative in a separate Delaware Court of Chancery shareholder case challenging a stock buyback ahead of LRN’s merger with Leeds Equity Partners.
As part of the agreement, Marks will pay $18 million to Seidman and directors Lee Feldman and Mats Lederhausen to resolve damages claims. The filing says the payment will conclude the defamation action, with “a meaningful sum to be donated by Seidman, Feldman, and Lederhausen to charity.”
The dispute traces back to a shareholder suit over a $1.35-per-share stock buyback that preceded LRN’s $7-per-share merger. Marks, serving as class representative, filed a supplement to the complaint that the three LRN leaders said included false and defamatory allegations about their conduct.
Seidman, Feldman and Lederhausen sued Marks for defamation in 2021. The litigation brought several setbacks for Marks.
In 2023, the Chancery Court disqualified Marks and a co-lead plaintiff from serving as class representatives after finding that Marks had “made false statements” in his court filing. A year later, the Superior Court granted summary judgment to the three executives, holding Marks liable for defamation per se.
The court determined that Marks’ accusations “impugned [them] in their business” and “could potentially deter others from associating with [them] or investing in their new endeavors,” according to the settlement filing. The Delaware Supreme Court later dismissed Marks’ attempt to appeal that ruling.
The parties reached the settlement shortly before a trial that would have determined the amount of damages.
Marks has also agreed to withdraw his claims in the related Chancery Court action and formally repudiate the allegations he advanced. In the stipulation, he stated, “When I joined the lawsuit, I had no evidence to support the allegations in the lawsuit, including the ones I added to it.” He will send notice of his dismissal and repudiation to the putative class.
Counsel for the LRN leaders said the resolution confirms the harm caused by the statements. Stephen Shackelford of Susman Godfrey LLP said in a written statement: “Dov has been the leading voice in the corporate ethics industry for decades, and the defamatory allegations at issue struck at the core of his work and reputation. Dov and his friends and colleagues, Mats and Lee, have vindicated their principles and themselves, while Mr. Marks has formally and unequivocally repudiated his original claims in a manner that leaves no ambiguity.”
Attorneys for Marks did not immediately respond to requests for comment.
