BREAKING: In the latest development in Carl Icahn’s attempt to take over Lionsgate and merge its assets with MGM, a Supreme Court judge in British Columbia has dismissed Icahn’s lawsuit to thwart a Lionsgate de-leveraging move on July 20 that took $100 million in debt off the books and converted it into equity, which was bought by shareholder John Kornitzer, who is loyal to the existing Lionsgate brass. In a separate third party transaction, Kornitzer sold those shares to Mark Rachesky, who is on the Lionsgate board and firmly behind current management. That move pushed Icahn’s 38% stake in the company back to 33.5%, and increase Rachesky’s stake from 19% to 29%. Icahn can still gain more shares, as his $7.50 per share tender offer has been extended until November 12. But his 33.5% stake isn’t enough to win a proxy fight.

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