Legato shareholders sue to block EMC acquisition
But deal is still expected to go through
By Robert McMillan, IDG News Service | Published: 00:00, 16 July 2003
EMC Corp.'s US$1.3 billion acquisition of Legato Systems Inc. has hit a snag.
Legato shareholders have filed two lawsuits in Santa Clara County Superior Court claiming "breach of fiduciary duty and self-dealing" against Legato and its board of directors.
The lawsuits were revealed exactly one week to the day after EMC agreed to buy Legato, a maker of storage management software, to fill product gaps in its storage infrastructure and data management software offerings.
EMC has said that it expects to complete the acquisition in the fourth quarter of this year, pending regulatory approval and the consent of Legato shareholders.
Legato could not be reached for comment on the lawsuit, but in the statement it claimed that the lawsuit allegations were meritless.
The company has hired Palo Alto, California, law firm Wilson Sonsini Goodrich & Rosati to represent it in the lawsuit, the statement said.
EMC declined to comment on the lawsuit. "This is a Legato issue. We don't comment on ongoing litigation," said an EMC spokesman.
