This is now 1%ers roll.
A Yahoo shareholder is suing the company and its board in Santa Clara County Superior Court over a massive 2014 data breach that was not disclosed to the public until last year. The suit, which spotlights the prospective pay packages of CEO Marissa Mayer and co-founder David Filo, is the latest of several dozen suits that have been filed by consumers and shareholders relating to hacks.
The 2014 breach, and others, played a role getting Verizon a $350 million discount on its deal to purchase Yahoo’s Internet properties. While Yahoo’s users and shareholders did not find out about the hack until 2016, senior executives and Yahoo’s legal team were aware of a breach in 2014 affecting 26 users and failed to investigate it adequately, according to a recent report by two independent board members.
Last year, Yahoo said the breach affected at least 500 million accounts, the second largest in the nation’s history.
Shareholder Patricia Spain argues in a suit filed this week that it is unfair that she and many shareholders didn’t learn about the breach until long after many key executives found out. She also said Filo and Mayer can still qualify for the full amount of their golden parachutes after the deal with Verizon closes. Her lawsuit alleges a breach of fiduciary duties, and says that Filo and Mayer knew about the 2014 breach.
Filo, Mayer and other executives stand to make money if they are dismissed after the Verizon deal, through a golden parachute or change in control clause in their contracts.
Read the whole story in the San Francisco Chronicle