Suit chases Katz

Says DWA boss sold out shareholders

A Dream Works Animation shareholder on Tuesday accused Hollywood heavyweight Jeffrey Katzenberg off enriching himself but screwing other owners when he agreed to sell the studio to Comcast for $41 a share.

DWA is worth more than the agreed-upon $3.8 billion sale price, but Chief Executive Katzenberg consented to the figure because he will receive 7 percent of the profits of Dream Works New Media in perpetuity, the class-action suit claims.

Dream Works New Media houses the digital youth network, Awesomeness TV, and other assets, and is a joint venture with Hearst and Verizon.

The plaintiff, Ann Arbor (Mich.) Employees Retirement System, claims the 65year-old studio executive breached his fiduciary responsibility to all sharehold- ers when he agreed to the deal.

Dream Works has produced such hits as “Shrek,” “Puss in Boots” and “Kung Fu Panda.”

“Had Katzenberg not received the extraordinarily valuable side deal, Comcast would have been required to increase the merger price to secure Katzenberg’s support,” Michael Barry, counsel to the Michigan pension, said in court papers filed in a Delaware court.

“The profit sharing arrangement — which provides Katzenberg the right to receive 7 percent of the joint venture entities’ profits in perpetuity — is so valuable that it cannot credibly be characterized as compensation for a two-year consulting contract.”

Katzenberg had been trying to shop the company for several years with the idea that the firm would do better as part of a larger entity.

Comcast already has an animation unit in Chris Meledandri’s Illumination Entertainment, but cut the deal in order to better compete with Disney in owning lucrative intellectual property that it can exploit in other realms.

It’s not clear how lucrative a deal to profit in perpetuity from Awesomeness TV can really be.

A spokesman for Jeffrey Katzenberg declined comment.