Vivendi Universal, S.A.
In re Vivendi Universal, S.A. Sec. Litigation, 02 Civ. 5571 (RJH/HBP)(S.D.N.Y.)

On January 29, 2010, the three month long securities fraud trial against Vivendi Universal, S.A., culminated with a jury verdict finding Vivendi liable for securities fraud on all 57 material misstatements. The Vivendi case is just one of nine securities class actions tried to verdict based on wrongs committed following the passage of the Private Securities Litigation Reform Act in 1995. The Hon. Richard J. Holwell, of the United States District Court for the Southern District of New York, presided over this litigation and the trial.

Since 2002, Abbey Spanier, LLP has represented the class plaintiffs in this long pending class action against defendants Vivendi Universal, S.A., and its two most senior officers, Jean Marie Messier (the company's CEO and Chairman until his ouster in July 2002) and Guillaume Hannezo (the company's CFO until July 9, 2002). From 2000 through 2002, defendants embarked on a $77 billion acquisition binge, turning a small French water utility company into a global media, communications and environmental services conglomerate.

The jury, after deliberating for three weeks, found defendant Vivendi violated the federal securities laws by making false and misleading statements concerning Vivendi's liquidity and overall performance between October 30, 2000, and August 14, 2002 (the "Class Period"). The class consists of all persons from the United States, France, England and the Netherlands who purchased or otherwise acquired ordinary shares or American Depository Shares ("ADS's") of Vivendi during the Class Period. See Class Notice at



  • Litigation commenced in July 2002.
  • On August 19, 2002, plaintiffs filed an amended consolidated complaint.
  • On October 1, 2002, Hon. Harold Baer, Jr., the judge initially assigned to the case, consolidated fourteen related actions against defendants.
  • On January 7, 2003, plaintiffs filed a consolidated class action complaint.
  • In February 2003, Defendants moved to dismiss the consolidated class action complaint challenging subject matter jurisdiction over the claims brought by foreign class members who acquired Vivendi's ordinary shares on foreign exchanges.
  • On November 4, 2003, Judge Baer, applying the "conduct test" to determine whether extra-territorial application of the federal securities laws was warranted, denied defendants' motion to dismiss for lack of subject matter jurisdiction. See In re Vivendi Universal, S.A. Sec. Litig., 381 F. Supp. 2d 158, 169 (S.D.N.Y. 2003).
  • Plaintiffs filed a first amended complaint on November 24, 2003.
  • On December 4, 2003, this case was reassigned to the Hon. Richard J. Holwell.
  • Defendants sought reconsideration of Judge Baer's order, which Judge Holwell denied by order dated September 21, 2004. Judge Holwell concluded that subject matter jurisdiction existed over foreign plaintiffs' claims pursuant to Section 10(b) of the Exchange Act and Rule 10b-5. See In re Vivendi Universal, S.A. Sec. Litig., No. 02 Civ. 5571 (RJH), 2004 U.S. Dist. LEXIS 21230, at *5 (S.D.N.Y. Oct. 22, 2004). The Court reasoned that the United States-based conduct alleged by plaintiffs "significantly contributed to the alleged fraud and that such conduct directly caused foreign investors' alleged losses." Id. at *26.



  • On October 20, 2004, Plaintiffs moved for class certification. Plaintiffs' motion was argued in July 2006.
  • On March 22, 2007, Judge Holwell issued an opinion (revised on May 21, 2007), certifying a class of all persons from the United States, France, England, and the Netherlands who purchased Vivendi ordinary shares or ADS's between October 30, 2000 and August 14, 2002. In re Vivendi Universal, S.A. Sec. Litig., 242 F.R.D. 76, 109 (S.D.N.Y. May 24, 2007).
  • On May 8, 2007, the Second Circuit denied Vivendi's Rule 23(f) appeal petition.
  • On October 9, 2007, the Supreme Court denied certiorari on the class issue.
  • In March 2008, defendants moved for partial reconsideration of the class certification order, citing "recent" information allegedly showing that Rule 23(b)(3)'s superiority requirement could not be established as to French shareholders because French courts would not give res judicata effect to a judgment in a Rule 23(b)(3) opt-out class action. On March 31, 2009, defendants' motion was denied. In re Vivendi Universal, S.A. Sec. Litig., 02 Civ. 5571 (RJH) (HBP), 2009 U.S. Dist. LEXIS 31198, at*57 (S.D.N.Y. Mar. 31, 2009).
  • On April 19, 2009, defendants petitioned for leave to appeal to the Second Circuit.
  • On September 15, 2009, the Second Circuit denied defendants' petition, holding that an immediate interlocutory appeal, though permissible, was unwarranted. In re Vivendi Universal, S.A. Sec. Litig., No. 09-1959 (2d Cir. Sept. 15, 2009).



  • Throughout the litigation, Lead Counsel conducted extensive discovery including the review of over four million pages of documents. Lead Counsel took approximately 80 depositions of present and former Vivendi officers, employees and directors, and third party bankers, auditors and rating agency analysts in the U.S., France, England and Morocco. A dozen experts on accounting, financial liquidity, rating agencies and causation and damages prepared to testify on behalf of plaintiffs and defendants.
  • Some witnesses were compelled to testify using international service and discovery procedures established under the Hague Convention and French law. Several depositions were taken in France before a French Magistrate Judge, some in the historic Palais de Justice in Paris near the Notre Dame Cathedral.
  • Fact discovery closed on June 30, 2007.



  • In August 2008, Defendants moved for summary judgment against plaintiffs. Plaintiffs opposed various motions in October 2008.
  • On March 31, 2009, Judge Holwell denied defendants' summary judgment motion. In re Vivendi Universal, S.A., Sec. Litig., 634 F. Supp. 2d 352 (S.D.N.Y. 2009) (as revised on April 6, 2009).



  • On October 5, 2009, after years of pre-trial preparation, the jury trial commenced. A twelve person jury was selected and opening statements were delivered by the parties.
  • On October 8, 2009, Vivendi launched a counter-action in the Tribunal de Grande Instance de Paris, a French court, to prevent two of the French class representatives, along with a French association representing minority shareholders, from taking part in the class action.
  • For three months, the parties offered testimony through live and videotaped witnesses. Plaintiffs, through their causation and damages expert, Dr. Blaine Nye, offered proof to the jury of the amount of fraud-induced inflation in the market price of Vivendi shares on each day during the Class Period. That inflation, represented the damages, of a maximum of 22.82 Euros per share during the height of the concealment of Vivendi's true liquidity risk. Plaintiffs sought damages on a per share basis; no demand was made at trial for a verdict based on an aggregate amount of damages.
  • Closing statements were delivered by the parties over 5 days ending on Monday morning, January 11, 2010. Judge Holwell instructed the jury on the law they were to apply to the evidence they had heard, and the jury commenced deliberations on the afternoon of January 11th.
  • On January 13, 2010, the Tribunal de Grande Instance de Paris dismissed Vivendi's case in a judgment finding that the claims were "ill-founded." Attorneys' fees and costs were awarded to the shareholders.


On January 29, 2010, the jury reached a verdict finding Vivendi liable for securities fraud on all 57 material misstatements. After discharging the jury, in describing the work of the attorneys trying the Vivendi case, Judge Richard J. Holwell stated, "I can only say that this is by far the best tried case that I have had in my time on the bench. I don't think either side could have tried the case better than these counsel have." Abbey Spanier and its other trial counsel released the following press release that day:

The jury verdict in a securities fraud class action trial against Vivendi S.A. will entitle investors to recover as much as an estimated $9.3 billion, or €6.6 billion, according to attorneys for the plaintiffs.

The case was filed in 2002 and has been on trial in federal court in New York since October 5, 2009. The class includes persons from France, the United States, England, and the Netherlands who acquired Vivendi securities during the period October 30, 2000 to August 14, 2002. Plaintiffs alleged that defendants concealed the company's true liquidity risk during the class period, and investors suffered losses resulting from a liquidity crisis in mid-2002.

"This verdict shows that deserving investors can get just compensation through class actions, even against the strongest opposition. Very few of these cases go all the way to trial, and we are gratified at the outcome," plaintiffs' attorneys from the New York law firms Abbey Spanier LLP, Milberg LLP, and Browne Woods George LLP said in a joint statement.

The lead plaintiffs in the case were the Retirement System for the General Employees of the City of Miami Beach and several individuals. Gerard Morel, a retiree from Caen, France, who testified at the trial, commented: "I am particularly proud that French shareholders were included in the class. It is a victory for investors everywhere." Rick Rivera, pension administrator for the Miami Beach retirement fund, stated: "This case shows that pension funds can play a positive role in making sure the stock market is free of fraud and is fair for all investors."

The verdict was issued on a "per-share" basis. The total recovery amount is based on an analysis by plaintiffs' economics expert assuming all class members submit claims. The amount includes prejudgment interest that may be added by the court. Class members' entitlements will depend on a number of factors, including their purchase and sale dates. A claims procedure, under supervision of the court, will be announced and publicized after the outcome is finalized.


On July 26, 2010, Judge Richard J. Holwell, of the United States District Court for the Southern District of New York heard argument by the parties in the Vivendi securities fraud class action concerning the impact of the United States Supreme Court's decision in Morrison v. National Australia Bank Ltd., No. 08-1191, 2010 WL 2518523, 2010 U.S. LEXIS 5257 (June 24, 2010).

In Morrison, the Supreme Court considered whether Section 10(b) of the Securities Exchange Act of 1934 provides a cause of action to "foreign plaintiffs suing foreign and American defendants for misconduct in connection with securities traded on foreign exchanges." The Supreme Court held that Section 10(b) applies to claims asserted in connection with the purchase or sale of a security listed on an American stock exchange, and the purchase or sale of any other security in the United States. The Morrison Court did not consider claims by U.S. purchasers or any claims with respect to a security identified as being listed or registered on a U.S. stock exchange.

In briefs submitted to Judge Holwell and during the July 26, 2010 hearing, Class Plaintiffs argued that the verdict in favor of all class members remains intact after Morrison for several reasons. First, Morrison does not affect the verdict in favor of class members who purchased ADRs because Vivendi ADRs were listed on the New York Stock Exchange and purchased in the United States. Second, in Morrison the Court only considered whether "foreigners" were covered by Section 10(b), so claims by U.S. purchasers, like the U.S. class members who purchased Vivendi ordinary shares, were not directly addressed by the Supreme Court. Third, as Vivendi has admitted, its ordinary shares, were listed on the New York Stock Exchange and were registered under the Securities Exchange Act of 1934. Plaintiffs argued that under Morrison, that means that class members who purchased Vivendi ordinary shares (including foreign class members) are covered by Section 10(b).

In an attempt to reduce its damages from the January 29, 2010 jury verdict against it, Vivendi argued that the holding in Morrison forecloses the claims of all purchasers of Vivendi ordinary shares because they were neither listed nor sold on an American stock exchange, but instead were listed only on foreign exchanges, where they were subject to foreign laws and regulations. Vivendi has requested that the Court enter judgment as a matter of law dismissing with prejudice the Section 10(b) claims of all shareholders who purchased Vivendi ordinary shares.



To: All persons from the United States, France, England and the Netherlands who purchased or otherwise acquired American Depositary Shares ("ADSs" or "ADRs") of Vivendi Universal, S.A., ("Vivendi") between October 30, 2000 and August 14, 2002 ("Class Members").

This is a Court-approved notification of the jury verdict holding defendant Vivendi liable in this case. The jury verdict also found that two former senior officers of Vivendi, Jean-Marie Messier and Guillaume Hannezo, did not violate the securities laws and are not liable on any of the claims asserted against them.  If you are a Class Member, you are entitled to file a claim for damages. The deadline for filing of claims is May 9, 2013. You may obtain a Claim Form and other information at or by calling 1-800-767-2840 toll-free. Vivendi will appeal the jury verdict and other aspects of the case, and the result is not final.

Attorneys for the plaintiffs ("Class Counsel") intend to file an application for an award of attorneys' fees and reimbursement of their nontaxable costs and expenses, to be paid out of the damages awarded to Class Members. Only amounts approved by the Court will be awarded. Class Counsel will request an award of attorneys' fees of up to one-third of the amount of any damages and prejudgment interest payable to the Class. The Court will set a hearing on the application after the conclusion of the claims procedure. Relevant deadlines, the hearing date, and other documents will be posted at

Clerk of Court