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Warner-Discovery CEO David Zaslav Is Getting Sued

10/6/2022

17 Comments

 
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This isn't necessarily Scooby news, and it is about a week old, but I thought it was interesting and wanted to share in case anyone didn't know, given all the discussions in the past month or so about the Warner-Discovery Merger. About a week ago, the Collinsville Police Shareholder Board (a shareholder of Warner-Discovery) in Illinois filed a lawsuit against Warner-Discovery. The lawsuit is attempting to sue David Zaslav for exaggerating the number of people who subscribe to HBO Max by over 10 million in a shareholder meeting. The Collinsville Police Shareholder Board claims that Zaslav included everyone who was eligible for an HBO Max bundle in the number of subscribers, despite that many of these eligible people did not actually use HBO Max. This artificially inflated the number of subscribers to look as if HBO Max had 10 million more subscribers than they actually did. TheWrap article which announced this did not specify specifically in what ways, but Zaslav is also accused of hiding information to mislead WB-Discovery shareholders during the merge. In addition to Zaslav, the Collinsville Police Shareholder Board will also be Warner CFO Gunnar Wiedenfels.
17 Comments
Carson Maitland - Smith link
10/7/2022 12:10:02 am

Serves you right Zaslav!

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Carson Maitland - Smith
10/7/2022 09:12:28 am

Bad news for Warner-Discovery

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whackman
10/7/2022 12:50:13 pm

That's putting this mildly. I don't wanna sound negaive about this, but I have a sinking feeling the lawsuit will cause the downfall of WBD. I can' see how they are going to get out this predicament at least not lightly. Anyway the lawsuit states that the plaintiffs are mad that WBD wasted their time on streaming instead of its traditional media businesses and isn't making money as a result. They wanted WBD to make money, WB wasted tons of it on its streaming service and not the traditional side/theatrical movie business.

According to the lawsuit, at the time of filing the Registration Statement and Prospectus, defendants either knew or had access to adverse information concerning operations of the WarnerMedia business of AT&T. Among other things, as subsequently disclosed by defendants after the merger:

(1) WarnerMedia’s HBO Max streaming business had a high churn rate that made the business not “viable” unless the churn rate was reversed;

(2) AT&T was overinvesting in WarnerMedia entertainment content for streaming, without sufficient concern for return on investments;

(3) WarnerMedia had a business model to grow the number of subscribers to its streaming service without regard to cost or profitability;

(4) WarnerMedia was improvidently concentrating its investments in streaming and ignoring its other business lines; and

(5) WarnerMedia had overstated the number of subscribers to HBO Max by as many as 10 million subscribers, by including as subscribers AT&T customers who had received bundled access to HBO Max, but had not signed onto the service. The adverse information was not disclosed to Discovery shareholders in the Registration Statement or Prospectus or otherwise prior to the effective date of the merger. When the true details entered the market, the lawsuit claims that investors suffered damages.

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Carson Maitland - Smith
10/7/2022 01:02:42 pm

They'll have to find another CEO.

John Locke
10/7/2022 11:29:05 pm

I mean really it depends if it goes to trial or gets settled, I have no real faith on the former but it's what I'd prefer simply for what they did to Scoob 2 and Batgirl, and the more I feel is coming, there's been so many cuts and more are on their way and I just... fear what else we'll lose, already considering the Venture Bros Movie as gone, terrified for more Doom Patrol or Harley Quinn... and frankly one of the things I always loved about WB as opposed to most other brands is the Warner Archive that made it so I could get Static shock and Legion of Superheroes (even that one on blu ray!!!), along with movies that just are cost prohibitive to sell otherwise...

WildwindVampire link
10/8/2022 09:47:34 am

I don't think it will necessarily call the company to collapse, but I think it could have adverse affects for them. It could mean more stuff is getting cancelled too. I still think Trick or Treat just slipped through because it was made before the merger, so it will be interesting to see how much (if at all) they still invest in DTVs.

John Locke
10/8/2022 12:35:18 pm

@wildwindvampire It's really hard to say, nerdsync recently had a vid about the krypto scooby doo movie and his conclusion was it was probably finished but buried and might be one of the tax write off things we just will never hear about. Trick or Treat might have gotten through for having cameos? Granted I just can't tell this whole thing is a mess.

WildwindVampire link
10/8/2022 08:35:47 pm

Yeah, it's definitely super hard to tell. I'm worried about that for Krypto, but I hope they let it go through and that we'll see it in 2023.

whackman
10/7/2022 02:53:10 pm

Layoffs on Cartoon Network/Adult Swim happend today this will no doubt affect the studio.

https://twitter.com/CNschedules/status/1578444791989215232

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Carson Maitland - Smith
10/7/2022 11:34:53 pm

That merger was an awful idea.

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WildwindVampire link
10/8/2022 09:48:08 am

That's too bad to hear. Thanks for sharing.

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Logan Dockery link
10/8/2022 09:16:33 am

Will HBO Max ever go back to the way it was before David Zaslav's takeover at Warner Bros Discovery and will David Zaslav get fired as CEO too

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Carson Maitland - Smith
10/8/2022 11:36:36 am

Yep

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whackman
10/8/2022 11:42:10 am

There's this article that came out talking about why Scooby himself won't appear in the series. It's because of how the character himself is what makes all the shows in the franchise kids shows. To quote the article:

“What made Scooby-Doo a kid show is Scooby-Doo. We couldn’t have a take on it, like how can we do this in a fun and modern way. Our efforts coincided with Warner Bros. Animation saying we can’t use the dog!”

https://screenrant.com/velma-show-mindy-kaling-scooby-doo-absence-explained/

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Carson Maitland - Smith
10/8/2022 01:15:19 pm

Fair enough

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WildwindVampire link
10/9/2022 09:02:28 am

It's interesting to hear the writers' perspective on why they didn't include Scooby. I wonder why WB didn't want them to use Scooby. I wonder if it has to do with them wanting to distance the more mature show from the children's content. I just made a post about the article. Thanks for sharing!

Reply
Carson Maitland - Smith
10/10/2022 07:52:22 am

WB should listen to us Scooby-Doo fans.




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