News & Analysis as of

Minority Shareholders

Sheppard Mullin Richter & Hampton LLP

Getting to Business Judgment in an Interested Transaction: Controlling Stockholder Must Put Procedural Protections in Place Prior...

In Flood v. Synutra Int’l, Inc., No. 101, 2018, 2018 Del. LEXIS 460 (Del. Oct. 9, 2018), the Delaware Supreme Court (Strine, C.J.) held that a controlling stockholder who pursues a merger with the controlled company will have...more

Holland & Hart - Fiduciary Law Blog

Minority Shareholders Are Fiduciaries Too

Often, a closely-held company comprises a large portion of a person’s wealth. In some instances, the company initially generated much of the person’s wealth. And in others, the company is formed as a vehicle to pass wealth...more

Farrell Fritz, P.C.

Does This Decision Put the Brakes on Non-Unanimous Amendments to Operating Agreements?

by Farrell Fritz, P.C. on

Much digital ink has been spilled on this blog and elsewhere (Tom Rutledge’s terrific article can be read) concerning the ability of LLC controllers to adopt or amend an operating agreement without the consent of all members....more

Norris McLaughlin, P.A.

Prosecutors Are Rarely Interested in Business “Theft” Cases

by Norris McLaughlin, P.A. on

Many business divorce cases start because one partner is improperly taking money from the business. Such behavior can come in many different forms, including a majority shareholder wildly overcompensating himself, running...more

Dickinson, Mackaman, Tyler & Hagen, P.C.

Eighth Circuit Denies Unique Twist on Minority Oppression Claim

On September 28, 2018, the Eighth Circuit affirmed a Nebraska district court’s ruling for the defendant majority shareholder in an economic duress case, Rasby v. Pillen, 2018 WL4654718. The case centered on a minority...more

Farrell Fritz, P.C.

Stock Pledge Agreement Defeats Minority Shareholder’s Standing to Sue for Statutory But Not Common-Law Dissolution

by Farrell Fritz, P.C. on

Last week, this blog wrote about a decision by Manhattan Commercial Division Justice Saliann Scarpulla in the burgeoning Yu family melee, in that case pitting one brother against the other and their sister over dissolution of...more

Dechert LLP

Global Private Equity Newsletter - Fall 2018 Edition: Minority Equity Investments: Evolving Market Terms in Europe

by Dechert LLP on

Minority Equity Arrangements - Given the increasingly competitive conditions for the deployment of capital by private equity sponsors and the desire for certain categories of owners to explore alternative opportunities for...more

Robins Kaplan LLP

Your Daily Dose of Financial News

by Robins Kaplan LLP on

So about that whole going private thing.  Change of plans for Elon & co. Here’s the inside scoop on the reversal...more

Carlton Fields

Minority Shareholders Utilize 28 USC § 1782 to Issue Subpoenas in Aid of Criminal Action They Plan to File Against Company...

by Carlton Fields on

A group of minority shareholders of Acheron Portfolio Corporation Luxembourg S.A. have convinced a federal district court in New York to permit them to subpoena several large banks for documents in aid of the shareholders’...more

Shearman & Sterling LLP

Delaware Court Of Chancery Grants Minority Stockholder's Section 220 Demand As To Emails But Denies Access To Merger-Related...

by Shearman & Sterling LLP on

On July 30, 2018, Vice Chancellor Tamika Montgomery-Reeves of the Delaware Court of Chancery partially granted a Section 220 demand for the books and records of Globalstar, Inc. brought by the company’s largest minority...more

Dentons

Recent Luxembourg case law on the minority action against management

by Dentons on

What is a minority action? The Luxembourg District Court has recently rendered a judgment clarifying, amongst others, the conditions to be met to validly bring a minority action against the management of a Luxembourg...more

Hogan Lovells

SBA Update: Less Than 1% Minority Shareholder Interest Could Impact Eligibility for Small Business Contract Awards

by Hogan Lovells on

The U.S. Small Business Administration (SBA) Office of Hearings & Appeals (OHA) recently held that an entity may be affiliated with another entity solely because it holds a very small minority ownership interest (less than...more

Norris McLaughlin, P.A.

Can Communication Be the Key to Avoiding Business Divorce Litigation?

by Norris McLaughlin, P.A. on

No matter how many times I write about disputes between business partners, and how many times clients tell me their horror stories, I remain amazed by the ease with which some major business divorces could have been avoided....more

Bradley Arant Boult Cummings LLP

Tennessee Diversifies Its Valuation-Method Portfolio for Closely Held Corporations

The Tennessee Supreme Court overruled three decades of precedent in Athlon Sports Communications, Inc. v. Duggan, giving trial courts broad discretion in the method used to determine the “fair value” of shares in “dissenters’...more

Morris James LLP

Court Of Chancery Explains Who Is A Controller

by Morris James LLP on

In Re Hansen Medical Inc. Stockholders Litigation, C.A. 12316-VCMR (June 18, 2018) - This is another decision in a series of recent decisions where the Court of Chancery had to decide if a less-than-50% stockholder...more

Brooks Pierce

Shareholder Inspection Rights for Closely Held Corporations

by Brooks Pierce on

The North Carolina Business Court recently strengthened the hands of minority shareholders in closely-held corporations. N.C. Gen. Stat. § 55-16-02(b) affords qualified shareholders the right to “inspect and copy: (1)...more

Farrell Fritz, P.C.

Bona Fide Purchaser Avoids Rescission of Minority Shareholder’s Unauthorized Sale of Corporation’s Realty

by Farrell Fritz, P.C. on

The Lowbet Realty saga, featuring the dissolution court’s rarely used authority to rescind an unauthorized sale of the corporation’s realty under Business Corporation Law § 1114, has finally ended after six years with a...more

Wilson Sonsini Goodrich & Rosati

New York Court Finds Failure to Meet MFW Standard in Controlling Stockholder Merger

In another significant M&A decision from the New York Supreme Court, the controlling stockholder of a Delaware corporation failed to obtain judicial deference under the so-called "MFW" framework for its merger with the...more

White & Case LLP

Global merger control: Crossing the finish line: Renewed focus on common ownership

by White & Case LLP on

The European Commission is paying greater attention to investors who hold stakes in multiple companies in the same industry and considering how this concentration of influence might have an anti-competitive effect. In...more

Faegre Baker Daniels

Even Minority Interest in a Competitor Could Violate Antitrust Laws

by Faegre Baker Daniels on

Companies and shareholders contemplating mergers or acquisitions must consider all potential anticompetitive implications of a deal, including the competitive effects of minority shareholder interests. The Federal Trade...more

Winstead PC

Threading the Needle: A Win-Win Buy-Sell Agreement for Private Company Majority Owners and Minority Investors

by Winstead PC on

The business relationship between private company majority owners and minority investors does not have to be a zero sum game—there are positives available for both sides in their business dealings. But, a win-win approach for...more

McCarter & English, LLP

Tesla’s Stock Option Grant To Its CEO

by McCarter & English, LLP on

On January 21, 2018, Tesla, Inc. (Tesla), the electric car manufacturer (also in the business of sustainable energy generation and storage), granted its Chairman and Chief Executive Officer, Elon Musk, an option, subject to...more

Dentons

Saudi Arabia Update – April 2018

by Dentons on

Companies Law amended - The Council of Ministers approved 11 amendments to the Companies Law on 10 April 2018 (the Amendments) – a brief summary is below. Companies established in Saudi Arabia should consider reviewing...more

Shearman & Sterling LLP

Who’s the Boss? Minority Stockholders That Exercise Control

by Shearman & Sterling LLP on

In two recent cases, the Delaware Court of Chancery provided informative guidance on when stockholders that hold less than 50% of a corporation’s stock are nevertheless considered to be controlling stockholders. This inquiry...more

Cadwalader, Wickersham & Taft LLP

Delaware Chancery Court Finds Elon Musk May Be Controlling Stockholder of Tesla Motors

On March 28, 2018, in In re Tesla Motors, Inc. Stockholder Litigation, the Delaware Court of Chancery denied a motion to dismiss a lawsuit brought by stockholders of Tesla Motors, Inc. (“Tesla” or the “Company”)....more

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