Summary
CSX Corporation (CSX) filed an 8-K report on January 9, 2009, primarily to disclose the preliminary approval of a settlement in a shareholder derivative lawsuit. The lawsuit alleged "short-swing" profits by The Children's Investment Fund and 3G Capital Partners LP under Section 16(b) of the Securities Exchange Act of 1934. While CSX is a nominal party, the action was brought for its benefit. If the settlement receives final court approval, CSX will receive a total of $11 million ($10 million from The Children's Investment Fund and $1 million from 3G Capital Partners LP). This settlement resolves claims related to alleged violations of Section 16(b) by the defendants. A hearing to determine final approval is scheduled for March 5, 2009. Investors should note that this filing relates to a legal matter and the financial impact on CSX is the inflow of settlement funds.
Key Highlights
- 1CSX Corporation filed an 8-K on January 9, 2009, reporting on a legal settlement.
- 2The settlement resolves a shareholder derivative lawsuit concerning alleged "short-swing" profits under Section 16(b) of the Securities Exchange Act of 1934.
- 3Defendants in the lawsuit are The Children’s Investment Fund and 3G Capital Partners LP.
- 4CSX will receive $11 million in total settlement funds: $10 million from The Children’s Investment Fund and $1 million from 3G Capital Partners LP.
- 5The settlement requires final court approval, with a hearing scheduled for March 5, 2009.
- 6CSX is a nominal party in the lawsuit, with the action brought for its benefit.