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ADRA.US
id: 1855

Alliance Entertainment Holding $511,000 Investor Settlement

$511,000
Cash Settlement
Delaware court of Chancery
Court
2023-0383
Case number
12/08/2022
Class period Start
02/10/2023
Class period End
Alliance Entertainment Holding Corp. has reached a $511,000 settlement with stockholders to resolve claims related to alleged disclosure and process issues surrounding its de-SPAC merger with Legacy Alliance.

Outline:
Stockholders challenged disclosures and decision-making around Adara’s merger with Legacy Alliance, which closed on February 10, 2023. The case centers on claims that key risks were not communicated to stockholders before the closing, including a creditor default notice and an exchange-listing issue.

Timeline:
  • February 11, 2021 — Adara consummated its SPAC IPO on NYSE American.
  • June 22, 2022 — Adara, Merger Sub, and Legacy Alliance entered into a business combination agreement.
  • December 12, 2022 — The company’s proxy statement relating to the merger was filed with the SEC.
  • January 18, 2023 — The de-SPAC transaction was approved, subject to conditions.
  • February 8, 2023 — Legacy Alliance received a notice of default letter from a creditor.
  • February 13, 2023 — Stockholders learned (after closing) about the February 8 default notice.
  • March 31, 2023 — The stockholder class action was filed in the Delaware Court of Chancery.
  • January 17, 2025 — The parties reached a settlement in principle.
Background:
Adara Acquisition Corp. was formed as a SPAC, raised money in an IPO, and gave public stockholders the option to redeem shares before any business combination.

Adara later pursued a deal to combine with Legacy Alliance, and the merger closed on February 10, 2023.

After the closing, stockholders claimed the de-SPAC process was conflicted and that the information available to stockholders before the redemption decision and closing did not reflect key risks that had emerged.

The case points to events and risks that surfaced close to closing—such as a creditor default notice dated February 8, 2023 that was disclosed on February 13, 2023—and also raises issues tied to exchange listing and a move to OTC markets.

The parties agreed to resolve the claims through a settlement.

What Can Investors Expect Now?

Alliance Entertainment Holding Corp. has reached a $511,000 settlement with stockholders to resolve claims related to alleged disclosure and process issues surrounding its de-SPAC merger with Legacy Alliance.

If you were damaged due to this situation, you can file for a payout and get your share of the settlement. You can check if you are eligible and other details in the FAQ section below.
Case Type
US Securities Class Action
Case Status
Distribution Preparation
Alleged Offence
Misleading Statements, 
Failure to Disclose, 
Breach of Fiduciary duty, 
Omissions
Suspected Party
Directors, 
Management, 
Shareholder
Security Type
Stocks
Trade Direction
Long
Filing date
03/31/2023
Plaintiffs
Matthew McKnight
Attorneys
Farnan LLP
Defendants
Thomas Finke ; Beatriz Acevedo-Greiff ; W. Tom Donaldson III ; Dylan Glenn ; Frank Quintero ; Paul G. Porter
Administrator
Strategic Claims Services
Court hearing date
06/27/2025
Objection deadline
06/02/2025
Attorney fee
$102,200
Trades matching type
FIFO

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