The shareholder lawsuit against Yahoo over the board of directors' failure to accept the buyout from Microsoft is getting more complicated by the day.
According to Michael Liedtke of the Associated Press, a new motion has been filed by shareholders' lawyer stating that Yahoo is attempting "to whitewash embarrassing documents" related to a Yahoo employee severance plan "adopted shortly after Microsoft made its initial bid (for the company)" as well as details of a conversation between Yahoo CEO Jerry Yang, and Microsoft CEO Steve Ballmer. The lawyer is requesting that the documents be released, and a hearing will take place this Tuesday to discuss the matter in the court of Chancellor William B. Chandler III in Delaware.
Apparently the fear is that the alleged information in these documents might aid Carl Ichan's bid to replace the Yahoo board of directors. The sealed documents (a commonality in lawsuits such as this), may contain information on how Yahoo's board attempted to make the company appear more valuable in order to drive up the price to Microsoft. If these documents do contain such information, it could assist the shareholders involved in the lawsuit in proving that the Yahoo board did not act in investors' best interest, the cruz of Icahn's argument in moving toward an election of 10 newly proposed board members - a list which includes Icahn himself.