Lawsuit over magnitude of CEOs control of company shows committee voted to give him two-year leave if he serves in a government position or office
Mark Zuckerberg may intend to pursue government service while retaining control of Facebook, according to recently unsealed tribunal filings in a case pitting the CEO against minority investors.
The class-action lawsuit was first filed in late April, after Zuckerberg proposed a corporate shake-up that would dilute the voting power of stockholders devoting him eternal control of the company, in the words of the shareholders lawyers. Text messages excerpted in the court documents reveal that Zuckerberg and two board members discussed the CEOs possible government service, and argued about how to present it to shareholders.
Venture capitalist Marc Andreessen, one of the companys most prominent investors, texted Zuckerberg in March to say that the biggest issue of the corporate proposal was how to define the govt service thing without freaking out shareholders that you are losing commitment.
A few a few weeks later, as Andreessen spoke with two other members of a special committee, the investor continued texting with Zuckerberg about negotiations. I guess the biggest remaining issue is still around the government service, he wrote.
Andreessen added that another of the committee members, former White House chief of staff Erskine Bowles, was massively uncomfortable with Zuckerberg going off on leave with no involvement by the board and retaining control.
Hes worried that its the straw that breaks the camels back on the optics of good governance, Andreesen went on about Erskine. Hes worried its the thing people will point to on proclamation and say what the fuck are you guys doing agreeing to this Particularly since he thinks govt service would require you to give up control of FB anyway and its a moot point.
My counter argument is that because its likely a moot point lets only give on it and it will probably never matter.
In mid-April, the special committee recommended that Facebooks board approve the new system, and according to the court documents Andreessen texted Zuckerberg: The cats in the bag and the purses in the river.
Zuckerberg replied: does that entail the cats dead?
Andreessen answered: mission accomplished, adding a smiley face. The committee approved the plan, as did shareholders, with Zuckerberg the controlling voter among them.
According to the proposal as it was described in a regulatory filing, Zuckerberg would be able to take a two-year leave from Facebook to serve in a government position or office without losing control of the company.
Minority Facebook investors sued Zuckerberg in late April and early May, alleging in in Delawares chancery court that the CEO and Andreessen unfairly meddled in the boards decision, and protected Zuckerberg over minority shareholders. The plan to restructure Facebooks stock system was paused by the court until the lawsuits resolution.
Attorneys for the plaintiffs declined to comment, and a spokesperson for Facebook told: Facebook is confident that the special committee engaged in a thorough and fair process to negotiate a proposal in the best interests of Facebook and its shareholders.
Zuckerberg has fastidiously tried to avoid the appearance of political bias, even as his company has sunk deeper into political disagreements, for example in board member Peter Thiels is supportive of Donald Trump and Facebooks emergence as a platform for misinformation and fake news. Earlier this year, Facebook fired the human squad that moderated its trending news section over accusations of bias, and Zuckerberg called it a crazy idea that misinforming and false articles could sway voters. He subsequently promised we take misinformation severely.
The CEO has also met with Republicans, Democrats and officials in the Obama administration, in part to talk about government surveillance. He has also increasingly turned his attention to philanthropy, saying that he wished to remedy, avoid and manage all cancer by the end of this century.
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