Shareholders, representing the City of Warwick Retirement System, initially rang the alarm bells in August 2022. They likened Snap’s actions to a game where rules suddenly change, leaving Class A shareholders powerless. Their complaint? The Snap powerhouses, Spiegel and Murphy, held a colossal 99.5% of Snap’s total voting prowess, despite only owning around 22% economic interest.
The Plaintiffs’ Play
The Western Pennsylvania Carpenters’ Pension Trust stepped into the fray after a misstep by the City of Warwick. While Vice Chancellor Fioravanti seemed receptive to the proposed governance reforms, his main contention remained the ambiguity around the class inclusion. His analogy of late notice to shareholders was akin to a stage actor being handed a script minutes before the performance. “It raises due process concerns,” he stated, underlining the gravity.
The Road Ahead
Post-hearing, Snap Inc.’s counsel maintained a stoic silence. However, the plaintiff’s counsel, seeing the silver lining, expressed hope. Drawing a parallel to a coach strategizing after a game’s setback, Mark D. Richardson confidently conveyed, “We intend to remedy the issues identified by the court.”
