The WSJ is reporting that Liberty Media (NSDQ: LINTA) has today gone to court to pry Barry Diller loose from his post as chairman and CEO of IAC (NSDQ: IACI). In a massive understatement, WSJ.com’s teaser reads: “Liberty Media took steps to seize control of IAC/InterActiveCorp from IAC Chairman Barry Diller, signaling a breakdown in relations between Liberty’s John Malone and his longtime partner.” This isn’t the first sign of a breakdown — last week, the two filed dueling motions in Delaware Chancery Court, with Diller/IAC filing for the right to vote Liberty’s proxy in favor of shifting to a single-tier scheme as it prepares to spin into five companies — a move endorsed by Malone until this change came up. Malone/Liberty quickly countered, accusing Diller of attempting a “corporate coup.”
Now, Jessica Vascellaro, who has had an inside track on this –particularly when it comes to Liberty — reports that the company has gone to Delaware Chancery Court again, this time to demand that Diller and other board members be ousted and replaced by Liberty reps. Liberty also wants Diller removed as sole director of BDTV, the entity through which Liberty holds most of its IAC stake. WSJ: “Liberty believes the maneuver will allow it to reclaim voting control of its stake in IAC, although Mr. Diller is likely to argue that these moves don’t affect his right to vote Liberty’s shares.”
Diller’s response is classic: “After reading this new salvo, I am beginning to think these people are insane. Everything they cite is hogwash.” And so on.
AP: “Malone’s lawyers sought the removal of seven IAC board members in all, including Diller, his wife the designer Dianne Von Furstenberg, Edgar Bronfman Jr. and Steven Rattner. …Three other current IAC board members were not named as targets, including a former Coca-Cola Co. executive, Donald Keough, and retired Army Gen. H Norman Schwarzkopf.”
Reuters: “Liberty and its affiliates also asked the Delaware Chancery Court to bar the deposed board members from going forward with the disputed spin-off plan or any other non-routine business transactions while the court deliberates on the matter.”