Goldman Sachs to be added as a second defendant in the class action lawsuit against Dell
A new class action lawsuit alleges that Goldman Sachs should be held partially accountable for a 2018 swap of special Dell stock that resulted in billions of dollars in shortfalls for stockholders.
Appeal for Amendment
Investors who formerly held a special type of Dell stock known as “Class V” requested a Delaware Chancery Court judge last Friday to accept an amended version of the class action complaint toward Dell Technologies Inc., enlisting Goldman Sachs & Co. LLC as a defendant.
Goldman Sachs is alleged to have helped and encouraged the deal, even pressuring advisors into it.
According to the lawsuit, Goldman forced Dell’s special committee and advisors into supporting the transaction by constantly threatening to convert the Class V Stock into Dell Class C Stock.
In re: Dell Technologies Inc. Class V Stockholders Litigation
Dell was sued in a class action lawsuit in 2018 following the company’s conversion of Class V stock to common stock.
Public shareholders claim they were defrauded of at least $6 billion after Dell Technologies paid $14 billion in cash and granted 149,387,617 shares of its Class C common stock in exchange for the Class V shares in December 2018.
Investors who owned Dell’s Class V stock — that was converted for a common stock — claim they were deceived, with Goldman Sachs assisting in the operation.
According to Friday’s motion, Goldman collaborated with Dell’s controllers to execute an illegal transaction that expropriated billions from Class V stockholders.
The transaction was allegedly made to aid in financing Dell’s 2016 acquisition of EMC Technologies for $67 billion.
Not only did Goldman push advisors into the agreement, but it subsequently boasted, both privately and publicly, that its work enabled the controllers to earn a multibillion-dollar profit at the cost of Class V investors, according to the class action motion.
In addition to the class action, Goldman Sachs received a $70 million success fee for the transaction.
Moreover, it stated that Goldman actively benefited the controllers’ interests at the expense of Class V owners by concealing the shares’ true worth.
The trial for the claims is expected for May 2022.
Editor’s Note on Dell Class V Stock Class Action Lawsuit:
This article is written to inform you of Goldman Sachs’s alleged involvement in the class action lawsuit against Dell Inc. Dell is also recently involved in a class action over Alienware 51 Laptops.
Case Name & No.: In re: Dell Technologies Inc. Class V Stockholders Litigation, Case No. 2018-0816
Jurisdiction: Court of Chancery of the State of Delaware
Products/Services: Security (stocks)
Allegations: Goldman Sachs allegedly helped the deal to swap Class V stock for common stock, resulting in the investors losing money
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