Epic Games Faces Legal Setback Over Board Membership Violations
In a significant legal development, the United States Justice Department has taken action against Epic Games, citing violations of Section 8 of the Clayton Act. This regulation is designed to prevent individuals from serving on the board of directors for two competing companies.
Following the Justice Department’s alert through its Antitrust Division, two board members appointed by Tencent, a minority stakeholder in Epic Games, have voluntarily resigned from their positions. The members in question are Ben Feder and David Wallerstein. In a move to comply with the legal requirements, Tencent has also agreed to forfeit its right to appoint any future board members at Epic.
In response to this situation, Epic Games confirmed the departures and stated that the board will soon be filled with “two new independent board members” selected by Epic’s shareholders. It is expected that Feder and Wallerstein will maintain their roles on Tencent’s board.
Additionally, Tencent holds a minority stake in Ubisoft, which is currently in discussions regarding a potential management buyout. Reports indicate that the Guillemot family, which has the majority ownership in Ubisoft, aims to retain control over the company’s direction amidst ongoing negotiations.
In related news, Epic Games is actively pursuing legal action against an individual accused of cheating in its popular Fortnite tournaments. The company alleges that the cheater used unauthorized software to gain an unfair advantage, resulting in significant prize winnings. Furthermore, Epic continues to engage in a legal battle with Apple over its ambitions to establish its own app store.
