Case 2:21-cv-00433 Document 1 Filed 01/15/21 Page 1 of 25 Page ID #:1

Joel E. Elkins (SBN 256020) 1 [email protected] WEISSLAW LLP 2 9100 Wilshire Blvd. #725 E. Beverly Hills, CA 90210 3 Telephone: 310/208-2800 Facsimile: 310/209-2348 4 Attorneys for Plaintiff 5 6 7 8 UNITED STATES DISTRICT COURT 9 CENTRAL DISTRICT OF CALIFORNIA 10 11 FRANK GALLO, ) Case No. ) 12 ) 13 Plaintiff, ) ) COMPLAINT FOR ) VIOLATIONS OF THE 14 vs. ) FEDERAL SECURITIES 15 ) LAWS PLC, JAMES ) ) JURY TRIAL DEMANDED 16 A. ATTWOOD, JR., DAVID KENNY, ) 17 THOMAS H. CASTRO, GUERRINO ) DE LUCA, KAREN M. HOGUET, ) ) 18 HARISH MANWANI, JANICE ) 19 MARINELLI MAZZA, JONATHAN ) MILLER, ROBERT C. POZEN, ) ) 20 DAVID RAWLINSON, NANCY ) 21 TELLEM, JAVIER G. TERUEL, and ) ) LAUREN ZALAZNICK, ) 22 )

23 Defendants. ) 24 25 Plaintiff Frank Gallo (“Plaintiff”), on behalf of himself and all others similarly 26 situated, upon information and belief, including an examination and inquiry conducted 27 28 - 1 -

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1 by and through his counsel, except as to those allegations pertaining to Plaintiff, which 2 are alleged upon personal belief, alleges the following for his Complaint: 3 NATURE OF THE ACTION 4 5 1. This is an action brought by Plaintiff against Nielsen Holdings plc 6 (“Nielsen” or the “Company”) and the members of Nielsen’s Board of Directors (the 7 “Board” or the “Individual Defendants”) for their violations of Sections 14(a) and 20(a) 8 9 of the Securities Exchange Act of 1934 (the “Exchange Act”), 15 U.S.C. §§ 78n(a),

10 78t(a), and U.S. Securities and Exchange Commission (“SEC”) Rule 14a-9, 17 C.F.R. 11 § 240.14a-9, and to enjoin the vote on a proposed transaction, pursuant to which 12 13 Nielsen’s Global Connect business (“Connect”) will be acquired by newly formed

14 entities (collectively, “Purchaser”) which are controlled by investment funds advised 15 by affiliates of Advent International Corporation (“Advent”) (the “Proposed 16 17 Transaction”).

18 2. On November 1, 2020, Nielsen issued a press release announcing that it 19 had entered into a Stock Purchase Agreement dated October 31, 2020 (the “Stock 20 21 Purchase Agreement”) to sell Connect to Purchaser. Under the terms of the Stock

22 Purchase Agreement, Nielsen will sell the equity interests of certain subsidiaries which 23 contain Connect to Purchaser in exchange for: (i) $2,700,000,000 in cash, and (ii) a 24

25 warrant to purchase equity interests in the company that will own Connect following

26 the closing of the Proposed Transaction, exercisable in certain circumstances. 27 28 - 2 -

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1 3. On December 23, 2020, Nielsen filed a Schedule 14A Definitive Proxy 2 Statement (the “Proxy Statement”) with the SEC. The Proxy Statement, which 3 recommends that Nielsen stockholders vote in favor of the Proposed Transaction, omits 4 5 or misrepresents material information concerning, among other things: (i) the 6 background of the Proposed Transaction; (ii) the financial projections and the data and 7 inputs underlying the financial valuation analyses that support the fairness opinion 8 9 provided by the Company’s financial advisor, J.P. Morgan Securities LLC (“J.P.

10 Morgan”); and (iii) Company insiders’ potential conflicts of interest. Defendants 11 authorized the issuance of the false and misleading Proxy Statement in violation of 12 13 Sections 14(a) and 20(a) of the Exchange Act.

14 4. In short, unless remedied, Nielsen’s public stockholders will be 15 irreparably harmed because the Proxy Statement’s material misrepresentations and 16 17 omissions prevent them from making a sufficiently informed voting decision on the

18 Proposed Transaction. Plaintiff seeks to enjoin the stockholder vote on the Proposed 19 Transaction unless and until such Exchange Act violations are cured. 20 21 JURISDICTION AND VENUE

22 5. This Court has jurisdiction over the claims asserted herein for violations 23 of Sections 14(a) and 20(a) of the Exchange Act and Rule 14a-9 promulgated 24

25 thereunder pursuant to Section 27 of the Exchange Act, 15 U.S.C. § 78aa, and 28

26 U.S.C. §1331 (federal question jurisdiction). 27 28 - 3 -

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1 6. The Court has jurisdiction over defendants because each defendant is 2 either a corporation that conducts business in and maintains operations in this District 3 or is an individual who has sufficient minimum contacts with this District so as to 4 5 render the exercise of jurisdiction by this Court permissible under traditional notions 6 of fair play and substantial justice. 7 7. Venue is proper in this District under Section 27 of the Exchange Act, 15 8 9 U.S.C. § 78aa, as well as under 28 U.S.C. § 1391 because: (i) the Company maintains

10 offices located in this District; (ii) one or more of the defendants either resides in or 11 maintains executive offices in this District; and (iii) defendants have received 12 13 substantial compensation in this District by doing business here and engaging in

14 numerous activities that had an effect in this District. 15 THE PARTIES 16 17 8. Plaintiff is, and has been at all times relevant hereto, a continuous

18 stockholder of Nielsen. 19 9. Defendant Nielsen is an England and Wales corporation, with its principal 20 21 executive offices located at 85 Broad Street, New York, New York 10004 and offices

22 located at 6255 W Sunset Boulevard, Los Angeles, California 90028. The Company 23 is a global measurement and data analytics company providing a view of consumers 24

25 and markets worldwide. Nielsen’s common stock trades on the New York Stock

26 Exchange under the ticker symbol “NLSN.” 27 28 - 4 -

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1 10. Defendant James A. Attwood, Jr. (“Attwood”) has been Chairperson of 2 the Board since November 2019 and a director of the Company since 2006. Defendant 3 Attwood previously served as Executive Chairperson of the Board on an interim basis 4 5 from July 2018 to November 2019, Chairperson of the Board from January 2016 to 6 July 2018, and Lead Independent Director of the Board from January 2015 to 7 December 2015. 8 9 11. Defendant David Kenny (“Kenny”) is Chief Executive Officer (“CEO”)

10 of the Company and has been a director since 2018. 11 12. Defendant Thomas H. Castro (“Castro”) has been a director of the 12 13 Company since 2020.

14 13. Defendant Guerrino De Luca (“De Luca”) has been a director of the 15 Company since 2017. 16 17 14. Defendant Karen M. Hoguet (“Hoguet”) has been a director of the

18 Company since 2010. 19 15. Defendant Harish Manwani (“Manwani”) has been a director of the 20 21 Company since 2015.

22 16. Defendant Janice Marinelli Mazza (“Marinelli Mazza”) has been a 23 director of the Company since 2020. 24

25 17. Defendant Jonathan Miller (“Miller”) has been a director of the Company

26 since 2020. Defendant Miller was appointed to the Board in connection with the 27 Company’s April 29, 2020 Cooperation Agreement with activist investor Elliott 28 - 5 -

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1 Management Corporation and certain of its affiliated funds (together, “Elliott”), which 2 at the time had a 13% economic interest in the Company. 3 18. Defendant Robert C. Pozen (“Pozen”) has been a director of the Company 4 5 since 2010. 6 19. Defendant David Rawlinson (“Rawlinson”) has been CEO of Connect 7 since February 2020 and a director of the Company since 2017. 8 9 20. Defendant Nancy Tellem (“Tellem”) has been a director of the Company

10 since 2019. 11 21. Defendant Javier G. Teruel (“Teruel”) has been a director of the Company 12 13 since 2010.

14 22. Defendant Lauren Zalaznick (“Zalaznick”) has been a director of the 15 Company since 2016. 16 17 23. Defendants identified in paragraphs 10-22 are referred to herein as the

18 “Board” or the “Individual Defendants.” 19 OTHER RELEVANT ENTITIES 20 21 24. Advent is a global private equity firm focused on buyouts of companies

22 in Western and Central Europe, North America, Latin America and Asia. Advent has 23 invested in over 350 private equity transactions in 41 countries, and as of June 30, 2020, 24

25 had $58.4 billion in assets under management. 26 SUBSTANTIVE ALLEGATIONS 27 28 - 6 -

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1 Background of the Company 2 25. Nielsen is a global measurement and data analytics company. Nielsen

3 provides clients with a comprehensive understanding of what consumers watch and 4 what they buy and how those choices intersect. The Company delivers critical media 5 6 and information, analytics and manufacturer and retailer expertise about

7 what and where consumers buy and what consumers read, watch and listen to 8 (consumer interaction across the television, radio, print, online, digital, mobile viewing 9 10 and listening platforms) on a local and global basis. Nielsen’s measurement and 11 analytical services help clients maintain and strengthen their market positions and 12 identify opportunities for profitable growth. The Company has a presence in 13 14 approximately 100 countries and its services cover more than 90 percent of the globe’s 15 GDP and population. Nielsen has significant investments in resources and associates 16 all over the world, including in many emerging markets, and holds leading market 17 18 positions in many of the Company’s services and geographies. 19 26. Prior to February 2019, Nielsen was aligned into two reporting segments: 20 what consumers buy (“Buy”) and what consumers read, watch and listen to (“Watch”). 21 22 Beginning in February 2019, Nielsen realigned its business segments from Buy and 23 Watch to Connect and Nielsen Global Media (“Media”). Each segment operates as a 24

25 complete unit - from the conception of a product, through the collection of the data, 26 into the technology and operations, all the way to the data being sold and delivered to 27 the client. 28 - 7 -

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1 27. The Connect and Media segments are built on a foundation of proprietary 2 data assets that are designed to yield essential insights for clients to successfully 3 measure, analyze and grow their businesses. The Company’s segments each consist of 4 5 two categories: Measure and Predict / Activate in Connect and 6 and Plan / Optimize in Media. These categories are based on Nielsen’s core 7 measurement platforms in both Connect and Media, while Predict / Activate and Plan 8 9 / Optimize are designed to build on Company measurement capabilities to enhance

10 client decision-making. 11 28. Nielsen’s Connect segment provides measurement services, which 12 13 include core tracking and scan data (primarily transactional measurement data and

14 consumer behavior information), and analytical services to businesses in the consumer 15 packaged goods (“CPG”) industry. Nielsen’s Connect services also enable its clients 16 17 to better manage their , uncover new sources of demand, manage their supply

18 chain issues, launch and grow new services, analyze their sales, drive merchandising 19 efficiency and effectiveness in-store and improve their marketing mix and establish 20 21 more effective consumer relationships. The data is used by its clients to measure their

22 market share, tracking billions of sales transactions per month in retail outlets around 23 the world. Its extensive database of retail and consumer information, combined with 24

25 its advanced analytical capabilities, helps generate strategic insights that influence

26 Nielsen’s clients’ key business decisions. Nielsen’s Connect segment represented 27 approximately 47% of Nielsen’s consolidated revenues in 2019. 28 - 8 -

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1 29. Nielsen’s Media segment provides viewership and listening data and 2 analytics primarily to the media and industries for television, radio, digital 3 and mobile viewing and listening platforms. Nielsen’s Media data is used by Nielsen’s 4 5 media clients to understand their audiences, establish the value of their advertising 6 inventory and maximize the value of their content, and by Nielsen’s advertising clients 7 to plan and optimize their spending. Nielsen’s Media segment represented 8 9 approximately 53% of its consolidated revenue in 2019.

10 30. On August 13, 2018, Elliott filed a Schedule 13D with the SEC, reporting 11 it had an 8.4% economic interest in the Company. In the Schedule 13D, Elliott stated 12 13 it would:

14 encourage [Nielsen] to undertake a full strategic review of, and initiate a 15 process to explore, the sale of [Nielsen] in full, in addition to the 16 17 exploration of the sale of certain of [Nielsen’s] businesses or assets,

18 including transactions in which [Elliott] may seek to participate and 19 potentially engage in, as a purchaser or investor. 20 21 31. On November 7, 2019, Nielsen announced its plan to spin-off the Connect

22 business. The press release quoted defendant Attwood as stating: 23 Nielsen has two strong and global franchises—Global Media and Global 24

25 Connect. Following an extensive review process, which included an in-

26 depth analysis of our businesses, strategies and market opportunities, the 27 Board concluded that separating into two independent, publicly traded 28 - 9 -

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1 companies is the best path to position each business for long term success 2 and maximize value creation . . . . As independent companies, both 3 Nielsen—the Global Media business—and the new company consisting 4 5 of Global Connect will enjoy added flexibility and further strengthen their 6 paths toward a new phase of growth, productivity and industry leadership. 7 32. On November 2, 2020, Nielsen announced its third quarter 2020 financial 8 9 results, reporting net income for the quarter of $7 million on a reported basis, compared

10 to a net loss of $472 million in the third quarter of 2019 and net income per share on a 11 diluted basis of $0.02 per share, compared to a net loss per share on a diluted basis of 12 13 $(1.33) per share for the third quarter of 2019. Commenting on the Company’s third

14 quarter financial results, defendant Kenny stated: 15 We delivered strong results in the third quarter, building on our track 16 17 record of successful execution. All key metrics for both Media and

18 Connect were in-line or ahead of expectations. Our teams moved swiftly 19 to enact our optimization plan, driving operational efficiencies and 20 21 permanent cost savings. This, in addition to actions taken earlier in the

22 year in response to COVID-19 related revenue pressure, enabled us to 23 drive strong adjusted EBITDA growth and higher free cash flow. We 24

25 have confidence in our ability to deliver on our objectives and guidance

26 for the full year 2020. . . . 27

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1 We made strong progress on key initiatives in the quarter, particularly 2 cross-media measurement with expansion of our Connected TV footprint 3 to now include YouTube and YouTubeTV. We continue to focus on 4 5 expanding our role in the ecosystem, enabling content and measuring 6 outcomes across key advertising categories. As we look forward, we 7 remain focused on executing on our growth strategies that will enable us 8 9 to better serve our clients.

10 The Proposed Transaction 11 33. On November 1, 2020, Nielsen issued a press release announcing the 12 Proposed Transaction. The press release states, in relevant part: 13 14 NEW YORK, and BOSTON, November 1, 2020 — Nielsen Holdings plc 15 (“Nielsen”) (NYSE: NLSN) announced today that it has signed a 16 definitive agreement under which affiliates of Advent International 17 18 (“Advent”), one of the largest and most experienced global private equity 19 investors, in partnership with James “Jim” Peck, former Chief Executive 20 Officer of TransUnion, will acquire the Nielsen Global Connect business 21 22 for $2.7 billion (subject to working capital, cash, debt-like items and other 23 customary adjustments). Nielsen will also receive warrants in the new 24

25 company exercisable in certain circumstances. Upon completion of the 26 transaction, Nielsen Global Connect will be a private company with the 27 flexibility to continue investing in the development and deployment of 28 - 11 -

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1 leading-edge measurement products and solutions. The transaction was 2 unanimously approved by Nielsen’s Board of Directors. 3 4 “This is a win for both Nielsen Global Connect and for Nielsen 5 (RemainCo), as well as for our shareholders,” said David Kenny, Chief 6 Executive Officer, Nielsen. “The sale of this business to Advent will 7 8 deliver substantial value sooner than was anticipated through the planned 9 spin-off and creates certainty for all stakeholders. The proceeds from the 10 11 sale will allow Nielsen to significantly reduce debt, which will provide 12 greater financial flexibility to execute our growth strategy and expand our 13 role in the global media marketplace. At the same time, we are excited 14 15 about this opportunity for Nielsen Global Connect and believe that 16 moving forward as a private company will better position the business to 17 accelerate its transformation and strengthen its market-leading position. 18 19 With the support of Advent’s resources and expertise, we believe the new 20 company will create and define the next century of consumer and market 21 measurement. We thank the entire Nielsen Global Connect team for their 22 23 invaluable partnership and look forward to continuing a strong working

24 relationship with them in the future.” 25 26 Kenny added, “All of the terrific work done by so many to pursue a spin- 27 off will position both businesses to thrive as standalone companies and 28 - 12 -

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1 will allow us to execute a smooth transaction. We are grateful for all of 2 this dedicated work.” 3 4 “Nielsen Global Connect is the gold standard in retail measurement, with 5 exceptional insights and unrivaled scale and coverage of the global CPG 6 and retail markets,” said Peck. “As customers face a rapidly evolving 7 8 marketplace, we recognize that they have high expectations for Nielsen 9 Global Connect to help them meet these new demands and to build on its 10 11 existing core platform and other retail measurement capabilities. We 12 intend to work with David Rawlinson and the talented management team 13 to accelerate the delivery of new capabilities and to continue the 14 15 transformation underway to build an innovative, high-performing culture 16 acutely focused on delivering value to customers around the world.” 17 18 “Advent is thrilled to partner with Jim in driving this next phase of growth 19 for Nielsen Global Connect,” said Chris Egan, Managing Partner at 20 Advent. “Advent has invested in data and information services companies 21 22 for nearly three decades, and earlier this year we teamed up with Jim to 23 identify a compelling business in the sector where we can apply our 24

25 combined experience and resources to create value. We see tremendous 26 potential to build on Global Connect’s cutting-edge platform, drawing on 27 28 - 13 -

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1 our global footprint and operational strength to further scale the business 2 and advance its leadership across established and emerging markets.” 3 4 David Rawlinson will remain CEO of Nielsen Global Connect through the 5 close of the transaction and is expected to be part of the leadership team 6 for the go-forward company. Upon close, Peck will be involved in the 7 8 day-to-day strategic and operational activities of the company, which will 9 be headquartered in Chicago, IL. In early 2021, the Global Connect 10 11 business will be renamed NielsenIQ. 12 Nielsen will grant Nielsen Global Connect a license to its products 13 14 and services with the “Nielsen” name and other Nielsen trademarks for 20 15 years following closing. Additionally, Nielsen and Advent will enter into 16 agreements pursuant to which, among other things, Nielsen and Advent 17 18 will provide certain transitional services to each other for periods of up to 19 24 months following closing, grant each other reciprocal licenses for 20 certain data and corresponding services relating to that data for periods of 21 22 up to five years following closing and grant each other licenses to use 23 certain patents. 24

25 BACKGROUND ON NIELSEN GLOBAL CONNECT AND 26 TRANSACTION DETAILS 27 28 - 14 -

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1 Nielsen Global Connect provides consumer packaged goods 2 manufacturers and retailers with actionable information and a complete 3 picture of the complex and changing marketplace that brands need to 4 5 innovate and grow their business. The company offers data and builds 6 tools that use predictive models to turn market observations into business 7 decisions and winning solutions. These data and insights provide the 8 9 essential foundation that makes markets possible in the rapidly evolving

10 world of commerce. 11 12 Nielsen plans to use net proceeds of the transaction primarily to reduce 13 debt and for general corporate purposes. On a pro-forma basis for the 14 15 transaction, Nielsen expects year-end 2020 net leverage to be 16 approximately 4X. The transaction is subject to approval by Nielsen 17 shareholders, regulatory approvals, consultation with the works council 18 19 and other customary closing conditions; it is expected to close in the 20 second quarter of 2021. 21 The Proxy Statement Contains Material Misstatements or Omissions 22 23 34. The defendants filed a materially incomplete and misleading Proxy

24 Statement with the SEC and disseminated it to Nielsen’s stockholders. The Proxy 25 Statement misrepresents or omits material information that is necessary for the 26 27 28 - 15 -

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1 Company’s stockholders to make an informed decision whether to vote in favor of the 2 Proposed Transaction. 3 35. Specifically, as set forth below, the Proxy Statement fails to provide 4 5 Company stockholders with material information or provides them with materially 6 misleading information concerning: (i) the background of the Proposed Transaction; 7 (ii) the financial projections and the data and inputs underlying the financial valuation 8 9 analyses that support the fairness opinion provided by the Company’s financial advisor,

10 J.P. Morgan; and (iii) Company insiders’ potential conflicts of interest. 11 Material Omissions Concerning the Background of the Proposed Transaction 12 13 36. The Proxy Statement fails to disclose material information concerning the

14 background process leading to the Proposed Transaction. 15 37. For example, according to the Proxy Statement, during the November 16 17 2019 through June 2020 timeframe Nielsen had “discussions with representatives of

18 Elliott and other investors regarding their input on the spin-off, as well as on Nielsen 19 and its businesses and strategic alternatives.” Proxy Statement at 27. The Proxy 20 21 Statement, however, fails to disclose the details of these negotiations.

22 38. In addition, the Proxy Statement fails to disclose the terms of the 23 confidentiality agreements the Company entered into with potential bidders. 24

25 Specifically, the Proxy Statement fails to disclose whether any of the standstills

26 included in confidentiality agreements the Company entered into with potential bidders 27 during the sale process, including, but not limited to parties referred to in the Proxy 28 - 16 -

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1 Statement as “Bidder D” and the “Mixed Consortium,” contained a “don’t-ask, don’t- 2 waive” (“DADW”) standstill provision that is still in effect and presently precluding 3 any potential counterparty from submitting a topping bid for Connect. 4 5 39. The failure to disclose the existence of DADW provisions creates the false 6 impression that a potential bidder who entered into a confidentiality agreement could 7 make a superior proposal for Connect. If the potential acquirer’s confidentiality 8 9 agreement contains a DADW provision, then that potential bidder can only make a

10 superior proposal by (i) breaching the confidentiality agreement—since in order to 11 make the superior proposal, it would have to ask for a waiver, either directly or 12 13 indirectly; or by (ii) being released from the agreement, which if action has been done,

14 is omitted from the Proxy Statement. 15 40. Any reasonable Nielsen stockholder would deem the fact that a likely 16 17 topping bidder may be precluded from making a topping bid for Connect to

18 significantly alter the total mix of information. 19 41. The omission of this information renders the statements in the 20 21 “Background of the Transaction” section of the Proxy Statement false and/or materially

22 misleading in contravention of the Exchange Act. 23 Material Omissions Concerning Nielsen’s Financial Projections and J.P. Morgan’s 24

25 Financial Analyses

26 42. The Proxy Statement omits material information regarding Nielsen’s 27 financial projections. 28 - 17 -

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1 43. For example, with respect to Nielsen’s financial projections for Connect, 2 for each of the Board Direction Case, CIM Case, Trend Case, Trend with Cost 3 Mitigants Case, and Upside Case, the Proxy Statement fails to disclose unlevered free 4 5 cash flows (“UFCFs”) and the line items underlying UFCFs. 6 44. In addition, the Proxy Statement sets forth that at an April 16, 2020 Board 7 meeting, J.P. Morgan and the Board reviewed “forecasted financial information that 8 9 Nielsen management developed with respect to Connect, which reflected Nielsen’s

10 operating plan for the fiscal year ending December 31, 2020, adjusted for the impacts 11 of the COVID-19 pandemic, various restructuring and separation costs, and updated 12 13 corporate allocations.” Id. The Proxy Statement fails, however, to disclose the details

14 of management’s forecasts for Connect presented at the April 16 Board meeting. 15 45. The Proxy Statement also fails to disclose material information regarding 16 17 J.P. Morgan’s financial analyses.

18 46. The Proxy Statement describes J.P. Morgan’s fairness opinion and the 19 various valuation analyses it performed in support of its opinion. However, the 20 21 description of J.P. Morgan’s fairness opinion and analyses fails to include key inputs

22 and assumptions underlying these analyses. Without this information, as described 23 below, Nielsen’s public stockholders are unable to fully understand these analyses and, 24

25 thus, are unable to determine what weight, if any, to place on J.P. Morgan’s fairness

26 opinion in determining whether to vote in favor of the Proposed Transaction. 27 28 - 18 -

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1 47. With respect to J.P. Morgan’s Discounted Cash Flow Analysis, the Proxy 2 Statement fails to disclose: (i) the UFCFs for calendar years 2020 through 2024 utilized 3 in the analysis; (ii) the definition used in the calculation of UFCF; (iii) the line items 4 5 underlying UFCF; (iv) quantification of the inputs and assumptions underlying the 6 discount rates ranging from 8.75% to 9.75%; and (v) the terminal value of Connect. 7 48. With respect to J.P. Morgan’s Equity Research Analyst Valuations, the 8 9 Proxy Statement fails to disclose: (i) the individual equity research analyst valuations

10 for the firm value of Connect observed; and (ii) the sources thereof. 11 49. The omission of this material information renders the statements in the 12 13 “Certain Financial Forecasts” and “Opinion of Nielsen’s Financial Advisor” sections

14 of the Proxy Statement false and/or materially misleading in contravention of the 15 Exchange Act. 16 17 Material Omissions Concerning Company Insiders’ Potential Conflicts of Interest

18 50. The Proxy Statement fails to disclose material information concerning the 19 potential conflicts of interest faced by the Company’s insiders. 20 21 51. The Proxy Statement sets forth, “It is possible that Connect employees,

22 including Mr. Rawlinson, will enter into new compensation arrangements with 23 Purchaser. Those arrangements may include, among other things, agreements 24

25 regarding future terms of employment, the right to receive equity or equity-based

26 awards of Purchaser and/or to receive retention bonus awards.” Id. at 65. Yet, the 27 Proxy Statement fails to disclose the details of any employment and retention-related 28 - 19 -

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1 discussions and negotiations that occurred between Advent and Nielsen executive 2 officers, including who participated in all such communications, when they occurred 3 and their content. The Proxy Statement further fails to disclose whether any of 4 5 Advent’s proposals or indications of interest mentioned management retention or 6 equity participation in the combined company. 7 52. Communications regarding post-transaction employment and merger- 8 9 related benefits during the negotiation of the underlying transaction must be disclosed

10 to stockholders. This information is necessary for Nielsen’s stockholders to understand 11 potential conflicts of interest of management and the Board, as that information 12 13 provides illumination concerning motivations that would prevent fiduciaries from

14 acting solely in the best interests of the Company’s stockholders. 15 53. The omission of this information renders the statements in the 16 17 “Background of the Transaction” section of the Proxy Statement false and/or materially

18 misleading in contravention of the Exchange Act. 19 54. The Individual Defendants were aware of their duty to disclose the above- 20 21 referenced omitted information and acted negligently (if not deliberately) in failing to

22 include this information in the Proxy Statement. Absent disclosure of the foregoing 23 material information prior to the stockholder vote on the Proposed Transaction, 24

25 Plaintiff and the other stockholders of Nielsen will be unable to make an informed

26 voting decision in connection with the Proposed Transaction and are thus threatened 27 with irreparable harm warranting the injunctive relief sought herein. 28 - 20 -

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1 CLAIMS FOR RELIEF 2 COUNT I

3 Claims Against All Defendants for Violations of Section 14(a) of the 4 Exchange Act and Rule 14a-9 Promulgated Thereunder 5 55. Plaintiff repeats all previous allegations as if set forth in full. 6 56. During the relevant period, defendants disseminated the false and 7 8 misleading Proxy Statement specified above, which failed to disclose material facts 9 necessary to make the statements, in light of the circumstances under which they were 10 made, not misleading in violation of Section 14(a) of the Exchange Act and SEC Rule 11 12 14a-9 promulgated thereunder.

13 57. By virtue of their positions within the Company, the defendants were 14 aware of this information and of their duty to disclose this information in the Proxy 15 16 Statement. The Proxy Statement was prepared, reviewed, and/or disseminated by the

17 defendants. It misrepresented and/or omitted material facts, including material 18 information about the background of the Proposed Transaction, Nielsen’s financial 19 20 projections for Connect, the data and inputs underlying the financial valuation analyses

21 that support the fairness opinion provided by J.P. Morgan, and Company insiders’ 22 potential conflicts of interest. The defendants were at least negligent in filing the Proxy 23 24 Statement with these materially false and misleading statements.

25 26 27 28 - 21 -

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1 58. The omissions and false and misleading statements in the Proxy Statement 2 are material in that a reasonable stockholder would consider them important in deciding 3 how to vote on the Proposed Transaction. 4 5 59. By reason of the foregoing, the defendants have violated Section 14(a) of 6 the Exchange Act and SEC Rule 14a-9(a) promulgated thereunder. 7 60. Because of the false and misleading statements in the Proxy Statement, 8 9 Plaintiff is threatened with irreparable harm, rendering money damages inadequate.

10 Therefore, injunctive relief is appropriate to ensure defendants’ misconduct is 11 corrected. 12 13 COUNT II 14 Claims Against the Individual Defendants for Violations of Section 20(a) of the Exchange Act 15 16 61. Plaintiff repeats all previous allegations as if set forth in full.

17 62. The Individual Defendants acted as controlling persons of Nielsen within 18 the meaning of Section 20(a) of the Exchange Act as alleged herein. By virtue of their 19 20 positions as officers and/or directors of Nielsen, and participation in and/or awareness

21 of the Company’s operations and/or intimate knowledge of the false statements 22 contained in the Proxy Statement filed with the SEC, they had the power to influence 23 24 and control and did influence and control, directly or indirectly, the decision-making

25 of the Company, including the content and dissemination of the various statements 26 which Plaintiff contends are false and misleading. 27 28 - 22 -

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1 63. Each of the Individual Defendants was provided with or had unlimited 2 access to copies of the Proxy Statement and other statements alleged by Plaintiff to be 3 misleading prior to and/or shortly after these statements were issued and had the ability 4 5 to prevent the issuance of the statements or cause the statements to be corrected. 6 64. In particular, each of the Individual Defendants had direct and supervisory 7 involvement in the day-to-day operations of the Company, and, therefore, is presumed 8 9 to have had the power to control or influence the particular transactions giving rise to

10 the securities violations as alleged herein, and exercised the same. The Proxy 11 Statement at issue contains the unanimous recommendation of each of the Individual 12 13 Defendants to approve the Proposed Transaction. They were, thus, directly involved

14 in the making of the Proxy Statement. 15 65. In addition, as the Proxy Statement sets forth at length, and as described 16 17 herein, the Individual Defendants were each involved in negotiating, reviewing, and

18 approving the Proposed Transaction. The Proxy Statement purports to describe the 19 various issues and information that they reviewed and considered—descriptions the 20 21 Company directors had input into.

22 66. By virtue of the foregoing, the Individual Defendants have violated 23 Section 20(a) of the Exchange Act. 24

25 67. As set forth above, the Individual Defendants had the ability to exercise

26 control over and did control a person or persons who have each violated Section 14(a) 27 and SEC Rule 14a-9, promulgated thereunder, by their acts and omissions as alleged 28 - 23 -

COMPLAINT FOR VIOLATIONS OF THE FEDERAL SECURITIES LAWS Case 2:21-cv-00433 Document 1 Filed 01/15/21 Page 24 of 25 Page ID #:24

1 herein. By virtue of their positions as controlling persons, these defendants are liable 2 pursuant to Section 20(a) of the Exchange Act. As a direct and proximate result of 3 defendants’ conduct, Nielsen’s stockholders will be irreparably harmed. 4 5 PRAYER FOR RELIEF 6 WHEREFORE, Plaintiff demands judgment and preliminary and permanent 7 relief, including injunctive relief, in his favor on behalf of Nielsen, and against 8 9 defendants, as follows:

10 A. Preliminarily and permanently enjoining defendants and all persons acting 11 in concert with them from proceeding with, consummating, or closing the 12 13 Proposed Transaction and any vote on the Proposed Transaction, unless

14 and until defendants disclose and disseminate the material information 15 identified above to Nielsen stockholders; 16 17 B. In the event defendants consummate the Proposed Transaction, rescinding

18 it and setting it aside or awarding rescissory damages to Plaintiff; 19 C. Declaring that defendants violated Sections 14(a) and/or 20(a) of the 20 21 Exchange Act, as well as SEC Rule 14a-9 promulgated thereunder;

22 D. Awarding Plaintiff the costs of this action, including reasonable allowance 23 for Plaintiff’s attorneys’ and experts’ fees; and 24

25 E. Granting such other and further relief as this Court may deem just and

26 proper. 27 JURY DEMAND 28 - 24 -

COMPLAINT FOR VIOLATIONS OF THE FEDERAL SECURITIES LAWS Case 2:21-cv-00433 Document 1 Filed 01/15/21 Page 25 of 25 Page ID #:25

1 Plaintiff demands a trial by jury on all claims and issues so triable. 2 Dated: January 15, 2021 WEISSLAW LLP Joel E. Elkins 3 4 By:

5 Joel E. Elkins 6 9100 Wilshire Blvd. #725 E. 7 Beverly Hills, CA 90210 Telephone: 310/208-2800 8 Facsimile: 310/209-2348 9 -and- Richard A. Acocelli 10 1500 Broadway, 16th Floor 11 New York, NY 10036 Telephone: 212/682-3025 12 Facsimile: 212/682-3010 13 Attorneys for Plaintiff 14 15 16 17 18 19 20 21 22 23 24

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COMPLAINT FOR VIOLATIONS OF THE FEDERAL SECURITIES LAWS