Fighting Shareholder Abuse & Political Misconduct: A discussion of In Re: Madison Square Garden Entertainment and Jastram v. NextEra Energy Inc.

Join Block & Leviton and Harvard Plaintiffs’ Law Association (HPLA) for a discussion of two recent cases, In Re: Madison Square Garden Entertainment, which included the infamous “attorney ban,” and Jastram v. NextEra Energy Inc., a securities class action stemming from a massive political scandal in Florida. Lunch will be provided!

Block & Leviton served co-lead counsel in the Madison Square Garden Entertainment, Inc. (“MSGE”; n/k/a/ Sphere Entertainment Co.) derivative action, whereby the firm successfully argued that CEO and Controller James Dolan intentionally made MSGE overpay for his other controlled company, Madison Square Garden Networks (MSGN), because he had a larger financial interest in MSGN than MSGE. Following years of hard-fought litigation—while also being banned from multiple Madison Square Property properties—plaintiffs resolved the action for $85 million.

The lawsuit captioned Jastram v. NextEra Energy Inc. concerns a political misconduct scandal beginning in December 2021 when media outlets, including the Orlando Sentinel and Miami Herald, began reporting that Florida Power & Light Company (FPL) and political consulting firm, Matrix LLC, had potentially violated state and federal campaign finance laws by using a network of nonprofits to steer funding to spoiler “ghost candidates” to derail the campaign efforts of unfriendly legislators seeking reelection to Florida state offices in 2020. Later reports alleged that FPL also spied on journalists following unsupportive reporting, improperly courted public officials with job offers while bidding to privatize certain public utilities, and FPL executives knowingly approved of Matrix’s dirty tricks to benefit the Company. FPL repeatedly denied these allegations, while executives and top corporate officers at NextEra falsely claimed that the alleged political misconduct orchestrated by FPL did not expose the Company to any meaningful legal or reputational risk based on an internal investigation. NextEra later acknowledged the opposite when FPL President and CEO Eric Silagy abruptly resigned, and the Company included a new risk disclosure in its SEC filings explicitly addressing the issue on January 25, 2023. On this news, NextEra’s stock dropped $7.31 per share, representing a market loss of approximately $15 billion.