Chimicles & Tikellis LLP has filed a shareholder lawsuit, derivatively on behalf of of Barnes & Noble Inc. (“B&N” or the “Company”), in the Court of Chancery of the State of Delaware (the “Action”). The Action alleges wrongdoing by the B&N directors for recklessly causing the Company to acquire Barnes & Noble College Booksellers, Inc. (“College Books”) (the “Transaction”) from B&N’s founder, Chairman and controlling stockholder, Leonard Riggio (“Riggio”) at a grossly excessive price, subjecting B&N to excessive risk.

On September 1, 2009, the Court appointed Chimicles & Tikellis LLP as Co-Lead Counsel in the Action.

On August 7, 2009, B&N agreed to acquire the privately-held College Books from Riggio, in a transaction valued at $596 million. In the Acquisition, B&N received the “Barnes & Noble” trade name, which was owned by College Books and which B&N licensed from College Book and College Books’ brick and mortar operations. The Transaction was completed on September 30, 2009.

The Action alleges that as a controlling stockholder of B&N, Riggio is obligated to sell College Books at a price entirely fair to B&N’s stockholders and engage in a process that is also entirely fair. The Action further alleges that the B&N Board members acted disloyally and caused B&N to waste valuable corporate assets by allowing the B&N Chairman and 32.1% shareholder, Riggio, to force B&N to acquire his company, College Books, at an unfairly high price, exposing B&N to substantial increased risk.

A public version of the Co-Lead Plaintiffs Verified Consolidated Shareholder Derivative Complaint, which was filed under seal, is available below.
On October 21, 2010, ruling from the bench, the Court allowed most of Co-Lead Plaintiffs’ claims for breach of fiduciary duty to survive against Riggio and all but two of the remaining B&N directors. The parties are engaged in discovery. On January 19, 2011, the Court entered a scheduling order, setting a trial for the week commencing December 12, 2011.