The suit, filed in U.S. District Court in Delaware this week, also names Brian Roberts, Comcast's president who served as a director of @Home, and David Woodrow, a former executive vice president of business development at Cox who also served on @Home's board.
@Home worked with cable partners to offer consumers high-speed Internet hook-ups. The company, which is due to be liquidated in bankruptcy court, is alleging that the defendants created "convoluted and interconnected" stock-option agreements that benefited them "but left At Home critically weakened."
"Cox and Comcast received the right at a future date (ultimately worth billions of dollars) to sell some or all of their At Home stock to AT&T, as well as an exit strategy from the contractual ties to At Home," the suit alleges. "The only 'loser' was At Home itself, which received unfair and inadequate compensation for participating in the transactions." The suit seeks $600 million in damages related to the options claims, as well as unspecified damages for breach of fiduciary duties.
A representative for Comcast said the company had no comment on the suit. But in documents the company filed with the Securities and Exchange Commission, Comcast said it believes this suit is without merit and intends to "vigorously" defend itself. Cox representatives could not immediately be reached for comment. But in a separate filing with the SEC, Cox also vowed to "defend this action vigorously."
Excite@Home filed forin 2001 and planned to sell its assets to AT&T for $307 million and then go out of business. But Excite@Home shareholders argued that the deal didn't place a high enough value on the company's assets. A protracted ensued. Customers of the company were eventually to independent broadband networks run by AT&T, Cox, Comcast, Rogers Communications, MediaOne Group and others.