This is a shareholder derivative action brought on behalf of Fidelity National against certain officers and members of the Company’s Board for breaches of their fiduciary duties between at least February 9, 2021 and February 10, 2023, inclusive (the “Relevant Period”) as set forth below.
Fidelity National is a financial technology company which offers various solutions in three key segments: Merchant Solutions; Banking Solutions; and Capital Market Solutions. The Merchant Solutions segment, which constituted roughly 30 percent of Fidelity National’s total revenue in 2021, enables retailers to accept and process electronic payment transactions.
On July 31, 2019, Fidelity National announced that it had completed the acquisition of Worldpay, Inc. (“Worldpay”), a global payment processing company, for $43 billion. After the acquisition, the Company planned to integrate Worldpay into its Merchant Solutions segment.
Throughout the Relevant Period, certain members of the Company’s Board issued false and misleading statements about the Worldpay acquisition, indicating that Fidelity National had “successfully completed the Worldpay integration” and touting the purported benefits of the acquisition for the Company.
In reality, the Company’s Merchant Solutions segment was seriously underperforming, and the Company failed to “successfully complete” the Worldpay integration as of the end of the Relevant Period.
The truth with respect to the Company’s failed integration efforts slowly emerged, beginning on August 4, 2022 with a series of key management changes. Changes in the Company’s executive leadership alerted shareholders and the public that perhaps the Worldpay integration had not been progressing as seamlessly as the Individual Defendants had indicated.
On November 3, 2022, the Company announced disappointing financial results for its Merchant Solutions segment, reporting a “margin contraction of 430 basis points.”
Finally, on February 13, 2023, the Company announced that it was getting rid of its Merchant Solutions business and Worldpay. The Company further reported that it had recognized a staggering $17 billion write-off of that asset.
In response to these announcements, the Company’s stock price declined dramatically, closing at $66.00 per share on February 13, 2023, down more than 36 percent from the stock’s closing price of $104.13 per share on August 3, 2022, just before the Company began reporting its leadership changes.
As a result of the foregoing, a securities class action was filed against the Company and Defendants Gary Norcross and Stephanie Ferris, as well as James Woodall, who is not a party to this action, captioned Palm Bay Police and Firefighters’ Pension Fund v. Fidelity Nat’l Info. Services, Inc., Case No. 3:23-cv-00252-TJC-PDB (M.D. Fla.) (the “Securities Action”). The Securities Action has exposed the Company to massive class-wide liability.
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