Earlier this year Facebook’s board of directors was sued after investors claimed that they were not working in their favor. The lawsuit stems from the fact that the Facebook’s board of directors allowed the company’s CEO, Mark Zuckerberg, to sell a majority of his shares but, still maintain majority control and voting rights in the social media company.
According to reports, court filings show that text messages sent by Facebook board member Marc Andreessen suggest he was working in favor of Zuckerberg. Private messages including “this line of argument is not helping” have given several investors the impression he was helping the CEO instead of working on behalf of investors.
Zuckerberg holds a majority share of Facebook voting rights. At the time, Zuckerberg wanted to sell off shares of his stock in order to fund his Chan Zuckerberg Initiative, a program that makes investments to fund two major goals “advancing human potential and promoting equal opportunity.” But, he did not want to lose voting control in Facebook. Consequently, Zuckerberg suggested creating a new class of stock for himself, to make that happen.
Three board members were then put in place to represent investors. They were put in place to decide whether Zuckerberg’s request was fair to investors and shareholders. Ultimately, the special committee agreed in favor of Zuckerberg’s new class of stock granting Zuckerberg the opportunity to sell $32.7 billion in stock.
With that being said, the lawsuit argues that the new type of stock actually diluted shareholder’s power and votes over the future of Facebook.
Marc Andreessen was one of the board members selected to be a part of the special committee. Andreessen, who was the cofounder of Netscape and later became a Silicon Valley investor, is accused of engaging in a conflict of interest, asserting he coached Zuckerberg while serving on the special committee.
The text messages shared details about the possibility of Zuckerberg working in the government while still retaining control of Facebook. Andreessen texted Mark Zuckerberg in March on how to maintain a balance between government service and Facebook saying: “how to define the gov’t service thing without freaking out shareholders that you are losing commitment,” one text sent by Andreessen said.
Andreessen later texted, “I think the biggest remaining issue is still around the government service.”
News of Zuckerberg engaging in politics is not new. In the past, Zuckerberg argued for worldwide access to faster internet. In addition, Mark Zuckerberg hosted a fundraiser for Donald Trump supporter, former head of Trump’s transition team and governor of New Jersey Chris Christie. Also, Zuckerberg previously donated $100 million towards Newark’s school system.
But, Zuckerberg’s ties to politics extend beyond his commitments to faster internet access and higher quality education in the Newark’s classrooms. One of Facebook’s board members, Peter Theil is reportedly bringing Silicon Valley colleagues to meet with Donald Trump’s transition. It is important to note that Theil gained national attention after reports surfaced he was the secret bankroller behind the lawsuit that forced Gawker into bankruptcy, was also a Republican National Convention keynote speaker and avid supporter of Donald Trump, telling the world during the RNC: “When Donald Trump asks us to Make America Great Again, he’s not suggesting a return to the past. He’s running to lead us back to that bright future.”
