Retirement Fund Sues Google Over Stock

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It would seem that not everyone is happy with Google's recently announced stock split. The Brockton Retirement Board has filed a class action lawsuit against the search giant accusing Google of breaching its fiduciary duty to the company’s shareholders.

In a lawsuit filed in the state of Delaware, the suit alleges that Google co-founders Larry Page and Sergey Brin are issuing a stock split in order to cement their power over the company. The stock split would serve to make Google’s shares more affordable, but form a new class of non-voting shares for current investors such as the Brockton Retirement Board.
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Well, it doesn't appear to be the stock split per se that is ticking them off (stock splits are fairly uncontroversial things. Instead of having one share worth a large amount of money, you have two shares worth half that amount of money (or three or four depending on the split ratio) it's just a way for companies that have grown fast to open their shares up to more investors by lowering the price of each share.

The part that is controversial is that they are also reclassifying a lot of outstanding shares as "non voting shares" against the will of those holding those shares.

It will be interesting to see how this plays out.

Having voting and non-voting shares is nothing new, but typically I believe this is accomplished through new equity, not by reclassifying existing shares .
 
I'd expect nothing less from the "City of Champions". If I were Google I'd buy back the $500,000 in stock Brockton owns and tell them to go pound sand, followed by buying a few rounds of Mai Tai's and chicken fingers over at The Maui (http://www.yelp.com/biz/maui-restaurant-brockton).

(yeah I'm from the general area... not Brockton though. That city is a major dump).
 
Sounds about right. You start off with voting stock and are being forced into a non-voting class? I reading that right? Google needs to do a quick legal search :)D) to see this is going to go really well for them :rolleyes:.
 
Sergie & Larry: Ok you guys got a point
Retards suing: Ah ha you admit it!
S & L : Yes lets have a vote to see what the company does... so more than 50% of the vote that we own goes towards... *pbbbbbbbbt* yeah I thought so!
 
Fifth Horseman said:
I'd expect nothing less from the "City of Champions". If I were Google I'd buy back the $500,000 in stock Brockton owns and tell them to go pound sand, followed by buying a few rounds of Mai Tai's and chicken fingers over at The Maui (http://www.yelp.com/biz/maui-restaurant-brockton).

(yeah I'm from the general area... not Brockton though. That city is a major dump).
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The vitriol is friggin' hilarious here. :rolleyes: Their voting stock is being converted to non-voting w/o much of a reason and you find this to be "ok." Fuck it, your vote in this upcoming election doesn't mean shit anyhow, so fuck it and just renounce your citizenship. Right? I mean your single vote doesn't count for anything, so why have the option of having a vote? :rolleyes:
 
TheWeazmeister said:
The vitriol is friggin' hilarious here. :rolleyes: Their voting stock is being converted to non-voting w/o much of a reason and you find this to be "ok." Fuck it, your vote in this upcoming election doesn't mean shit anyhow, so fuck it and just renounce your citizenship. Right? I mean your single vote doesn't count for anything, so why have the option of having a vote? :rolleyes:
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I think these people just don't understand the concepts of investment.

The Brockton people owned voting shares, which means they could vote at shareholder meetings.

Google wanted to convert those to non-voting shares, robbing them of their voting rights.

If Google instead had offered to buy them out, and replace them with non-voting shares, this had been a different story, but forcefully converting voting shares to non-voting shares is pretty questionable.
 
As if 500k worth of voting stock really has no real bearing when shareholder votes come up, that's a drop in the hat compared to most shareholders. Heck, Larry Page and Sergey Brin could buy out their stock with petty cash.

And really what do bunch of olde farts want with voter stock, like they know what is going to be good for the company.

And Stock Splits are a good thing anyway, they could potentially double their money in a few years vs. maybe a 2-5% over that time.

People made out like bandits when MS stock split, and like MS, Google isn't going anywhere.
 
matchstick said:
As if 500k worth of voting stock really has no real bearing when shareholder votes come up, that's a drop in the hat compared to most shareholders. Heck, Larry Page and Sergey Brin could buy out their stock with petty cash.

And really what do bunch of olde farts want with voter stock, like they know what is going to be good for the company.

And Stock Splits are a good thing anyway, they could potentially double their money in a few years vs. maybe a 2-5% over that time.

People made out like bandits when MS stock split, and like MS, Google isn't going anywhere.
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what the...

I dont even...
 
matchstick said:
As if 500k worth of voting stock really has no real bearing when shareholder votes come up, that's a drop in the hat compared to most shareholders. Heck, Larry Page and Sergey Brin could buy out their stock with petty cash.

And really what do bunch of olde farts want with voter stock, like they know what is going to be good for the company.

And Stock Splits are a good thing anyway, they could potentially double their money in a few years vs. maybe a 2-5% over that time.

People made out like bandits when MS stock split, and like MS, Google isn't going anywhere.
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Talk about missing the forest for the tree.

Not just 500K worth of voting stocks are going to be affected. There's a reason why they're applying for class status.
 
He did say, "And Stock Splits are a good thing anyway" so the old folks shouldn't complain.

I kid I kid

Really curious to see how this pans out.
 
matchstick said:
As if 500k worth of voting stock really has no real bearing when shareholder votes come up, that's a drop in the hat compared to most shareholders. Heck, Larry Page and Sergey Brin could buy out their stock with petty cash.
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And your vote is just one of some 300 million, and can't possibly have a bearing on the outcome, so why don't you just stay home in the fall election?

What if everyone thought like that?

Shareholder voting activity and involvement is very important for proper corporate governance.

matchstick said:
And really what do bunch of olde farts want with voter stock, like they know what is going to be good for the company.
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If you own something, you have a say in how it is managed. That's how it works. And yes, they have an interest in wanting the stock to grow in value and dividends to pay out so it can fund their retirement plans. The people running the fund are doubtlessly business / finance professionals who have a good understanding of business fundamentals, and as such their say is of value.

matchstick said:
And Stock Splits are a good thing anyway, they could potentially double their money in a few years vs. maybe a 2-5% over that time.
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All stock splits do is take your one share and split it in to more than one part. The total of the parts at the exact moment of the split is still equal in value to the original one share. Companies do this in order to encourage investment, if their outstanding shares grow in value to the point where one share is comparatively expensive.

matchstick said:
People made out like bandits when MS stock split, and like MS, Google isn't going anywhere.
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Stock split and "converting voting shares to non-voting shares" is not the same thing. usually when a stock splits, it does just that. it doesn't remove anyone's voting rights.


Wow, you really don't have a clue at all, do you?
 
Current GOOG shareholders will still retain voting shares. It's just they will get a non-voting share in addition, and the value of their voting share gets cut in half.
 
Zarathustra[H];1038673865 said:
I think these people just don't understand the concepts of investment.

The Brockton people owned voting shares, which means they could vote at shareholder meetings.

Google wanted to convert those to non-voting shares, robbing them of their voting rights.

If Google instead had offered to buy them out, and replace them with non-voting shares, this had been a different story, but forcefully converting voting shares to non-voting shares is pretty questionable.
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This exactly. The fact of the matter is that people are happy to give other's rights and freedoms all day long but God help us all when it is something they give a shit about.
 
Zarathustra[H];1038674338 said:
And your vote is just one of some 300 million, and can't possibly have a bearing on the outcome, so why don't you just stay home in the fall election?
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I bet the guy you were referencing in your reply would have a different tune if it was "his" game that he purchased, that he no longer had rights to play on anything but the system it was originally installed on, or some other DRM/limiting scheme that a corporation was trying to push down his throat....Oh wait, yeah this is 500k+ we are talking about, it's something they legally acquired, and now the company is trying to change the relationship. #smh
 
Zarathustra[H];1038674338 said:
And your vote is just one of some 300 million, and can't possibly have a bearing on the outcome, so why don't you just stay home in the fall election? What if everyone thought like that?
Most people actually do, only about 40 million voted in the last Presidential election, compared to 74 million who voted during the final round of American Idol.

Zarathustra[H];1038674338 said:
Shareholder voting activity and involvement is very important for proper corporate governance.[/qupte]
Right you are! It was the shareholder voting that ran Enron, MCI/Worldcomm, Anderson, etc. etc. etc., into the ground.
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Looks like Google needs to re evaluate their decision before they get taken to the wringers with a class action suite.
 
Thuleman said:
Most people actually do, only about 40 million voted in the last Presidential election, compared to 74 million who voted during the final round of American Idol.
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Which is a depressing statistic. The only thing that redeems it a bit is that the 74 million number for American Idol is probably inflated due to the number of 12 to 13 year old girls calling in and voting 10, 20, 50, 100 or 200 times each.


Thuleman said:
Right you are! It was the shareholder voting that ran Enron, MCI/Worldcomm, Anderson, etc. etc. etc., into the ground.
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Are you trying to agree with me here or not?


Thuleman said:
omg I failed quoting after all these years ... :(
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Happens to the best of us on occasion... :eek:
 
TheWeazmeister said:
No, of course not, however now a lot more corporations are facing hostile votes that govern those same aholes' salaries.
Here is one from not too long ago.
http://articles.latimes.com/2012/apr/18/business/la-fi-exec-pay-20120419
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Amen, it's about time.

I think the biggest problem with shareholder voting is that it is not as transparent as government voting.

For instance, I recently got the shareholder voting package for a company I own some stock in. There were two board members standing for reelection.

I did my best to look up their names and their backgrounds, but I couldn't find any information regarding their voting records and board meetings or anything like that, so I could make an educated decision of which to vote up or down. All I could find were essentially their resume's.

Shareholder voting still needs some serious reform, but these mandatory "say on pay" votes are definitely a step in the right direction.
 
You guys gotta read up on politics if we are gonna keep making this: google shares <-> presidental election.

Popular vote by single Americans does not choose the president, the electoral voters do.
 
staticlag said:
You guys gotta read up on politics if we are gonna keep making this: google shares <-> presidental election.

Popular vote by single Americans does not choose the president, the electoral voters do.
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Duuuuh... You mean we live in a Constitutional Republic? I didn't realize that... :rolleyes: All points still stand. It was an illustration of size of your vote compared to the greater amount of votes that are out there, not a direct one to one comparison but more a correlation of scale. But thank you for enlightening us.
 
TheWeazmeister said:
Duuuuh... You mean we live in a Constitutional Republic? I didn't realize that... :rolleyes: All points still stand. It was an illustration of size of your vote compared to the greater amount of votes that are out there, not a direct one to one comparison but more a correlation of scale. But thank you for enlightening us.
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Derp.

No ACTUALLY it was you trying to be alarmist.

Google != president of USA
 
staticlag said:
Derp.

No ACTUALLY it was you trying to be alarmist.

Google != president of USA
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LOL another 'tard for the filters. If you can't figure out what an illustration of scale is for comparison, you and I have nothing to say to each other.
 
Maybe if we considered staticlag's vote for presidential electorate a half vote, he wouldn't mind. There are a whole lot of other people I wouldn't mind their votes counting as half votes.
 
staticlag said:
You guys gotta read up on politics if we are gonna keep making this: google shares <-> presidental election.

Popular vote by single Americans does not choose the president, the electoral voters do.
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...and the vote you cast determines how the electoral college votes...

Your point?
 
The electoral college is a joke. There have been a handful of instances where the 'college', because of delegate allocation, has actually thrown the election to the guy who lost the popular election. If the US had a true democracy where popular vote was the rule we wouldn't have had a republican win the election 2000, 1888, and 1876.
 
night_2004 said:
The electoral college is a joke. There have been a handful of instances where the 'college', because of delegate allocation, has actually thrown the election to the guy who lost the popular election. If the US had a true democracy where popular vote was the rule we wouldn't have had a republican win the election 2000, 1888, and 1876.
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That's weird. I was only referring to Bush in 2000; I didn't realize republicans took the elections in 1888 and 1876 too.
 
Most of you have no idea what you're talking about. Their percent ownership of voting shares will be exactly the same as before the split.

With that said, institutional investors should be a little mad because their transaction costs will go up. Large blocks are usually charged a processing cost per share, so if you double the number of shares it will cost twice as much for a certain dollar amount of a trade.
 
dudewth said:
Most of you have no idea what you're talking about. Their percent ownership of voting shares will be exactly the same as before the split.
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If the split affects everyone the same way (half of new split shares are non-voting, half are) but the original article seems to have suggested that the intent was for Sergey Brin and Larry Page to consolidate control of the company, so my assumption is that it doesn't affect their shares the same way.

Maybe they hold some sort of preferred stock or something?
 
Zarathustra[H];1038687334 said:
If the split affects everyone the same way (half of new split shares are non-voting, half are) but the original article seems to have suggested that the intent was for Sergey Brin and Larry Page to consolidate control of the company, so my assumption is that it doesn't affect their shares the same way.

Maybe they hold some sort of preferred stock or something?
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It's a 100% stock dividend (or stock split) where only the dividend shares have no voting rights. So, the voting structure is the exact same before and after the dividend. The reason this benefits Brin/Page is that they can then sell the half that has no voting rights (dividend shares) and still retain their percent of voting shares by holding on to them. I think the lawsuit actually has some merit although I don't see it getting anywhere.

Preferred stock almost always has no voting rights attached. Preferred stock is similar to a bond, but lower in the pecking order than bonds during bankruptcy and higher than common stock.
 
Zarathustra[H];1038673274 said:
The part that is controversial is that they are also reclassifying a lot of outstanding shares as "non voting shares" against the will of those holding those shares.

It will be interesting to see how this plays out.

Having voting and non-voting shares is nothing new, but typically I believe this is accomplished through new equity, not by reclassifying existing shares .
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Don't like it? Vote against it when it comes up at the shareholder meeting. Oh, right, you don't have control over the company. IMO this is part of the risk of holding a minority stake.

TheWeazmeister said:
The vitriol is friggin' hilarious here. :rolleyes: Their voting stock is being converted to non-voting w/o much of a reason and you find this to be "ok." Fuck it, your vote in this upcoming election doesn't mean shit anyhow, so fuck it and just renounce your citizenship. Right? I mean your single vote doesn't count for anything, so why have the option of having a vote? :rolleyes:
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If enough people are for it, it would certainly be possible to ban certain people from voting in US general elections, or heck let Canadians vote in US elections. Amend the constitution and the people being shut out are SOL.
 
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