The lawsuit has been filed by trustees of Amalgamated Bank of New York and the Central Laborers Pension Fund, both News Corp shareholders (and both newly off the Murdochs' Christmas card list). Their basic argument is that Rupert has persuaded the News Corp board to over-pay for Shine, just because he wants to do his daughter a favour. 'In short, Murdoch is causing News Corp to pay $675 million for nepotism,' says the writ. 'In addition to larding the executive ranks of the company with his offspring, Murdoch constantly engages in transactions designed to benefit family members.' It's also suggesting the board breached its fiduciary duty to shareholders by not blocking the bid.
All very inflammatory, headline-grabbing stuff. But does it have any merit? Not according to News Corp, as you'd expect - it has dismissed the claim, arguing that Shine is a 'very attractive business' that fits perfectly into News Corp's entertainment portfolio. And given some of the high-profile TV content Shine produces, including the likes of Spooks, Masterchef, and One Born every Minute, it's undoubtedly an attractive asset.
So the question really boils down to: is News Corp paying too much? Well, independent assessments of the deal thus far don't seem to think so (or at least, not massively). More to the point, the deal is still subject to approval by both boards and News Corp's audit committee, not to mention an independent fairness opinion. If it fails one of those tests, these recalcitrant shareholders may have a chance; if it doesn't, it's hard to see this challenge getting anywhere.