Tbk Partners v. Western Union Corp‪.‬

This is an appeal from a judgment of the District Court for the Southern District of New York (Milton Pollack, Judge), approving the settlement of a consolidated shareholder class and derivative action involving a dispute over a century-old lease. In 1882, the Gold and Stock Telegraph Company ("Gold & Stock") leased its entire private telegraph business to the Western Union Telegraph Company ("Western Union") for a period of 99 years in return for annual payments to Gold & Stocks shareholders. Over the years, Western Union acquired 95.3% of Gold & Stocks 50,000 shares. Those minority shareholders who object to the settlement and who are appellants here contend that upon the expiration of the lease, Gold & Stock shareholders were entitled to Western Unions 1981 business, worth $17,000 per share of Gold & Stock. Pursuant to a proposed short-form merger between Western Union and Gold & Stock, Western Union had valued Gold & Stock shares at $256.97. The settlement increased this value by $126.53 to $383.50 per share. The objectors contend that the District Court erred in approving the settlement because (1) it enjoins class members from prosecuting claims that were not part of the class action and (2) the opposition of more than half of the class of minority shareholders to the settlement demonstrates its unfairness. We find neither reason persuasive and affirm the District Courts approval of the settlement.