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Shareholders Shareholder Litigation Standing

Allen Matkins

Judge Rules Shareholders Can Pursue Derivative Claim Following A "Conversion"

Allen Matkins on

A year ago, I posited the question whether a derivative suit can survive a conversion. I raised that question in reference to Palkon v. Maffei, 2024 WL 678204 (Del. Ch. Feb. 20, 2024), in which the plaintiffs unsuccessfully...more

A&O Shearman

Addressing The Enforceability Of Con Ed Provisions In Merger Agreements, Delaware Court Of Chancery Rejects Petition For...

A&O Shearman on

On October 31, 2023, Chancellor Kathaleen St. J. McCormick of the Delaware Court of Chancery issued final judgment denying a petition for a mootness fee award to a stockholder—who had previously asserted claims for breach of...more

A&O Shearman

Northern District Of Texas Dismisses Putative Class Action Against Amusement Park Operator For Lack Of Named Plaintiff’s Standing...

A&O Shearman on

On June 2, 2023, the United States District Court for the Northern District of Texas dismissed a putative class action against an amusement park operator and certain of its executives asserting claims under Section 10(b) of...more

A&O Shearman

Second Circuit Affirms Dismissal Of Exchange Act Claims Against Acquired Public Company, Holding That Shareholders Of An M&A...

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On September 30, 2022, a panel of the United States Court of Appeals for the Second Circuit affirmed a decision of the United States District Court for the Southern District of New York dismissing a putative securities fraud...more

Farrell Fritz, P.C.

The “Conflict of Interest” Defense to Shareholder Derivative Standing

Farrell Fritz, P.C. on

In shareholder derivative litigation, defendants occasionally argue that the plaintiff – who ostensibly sues on behalf of the company and its owners in a fiduciary capacity – has some form of conflict of interest with the...more

Sheppard Mullin Richter & Hampton LLP

California State Court Declines to Expand Standing for Claims Under 1933 Act

In Jensen v. iShares Trust, 2020 Cal. App. LEXIS 61 (Cal. App. Jan. 23, 2020), a rare state court decision addressing claims under the Securities Act of 1933 (“1933 Act”), the California Court of Appeal rejected...more

Farrell Fritz, P.C.

Dismissed: The Tragic, True Story of Direct and Derivative Claims Jumbled Together Beyond Recognition

Farrell Fritz, P.C. on

Much has been written about the pleading requirements unique to shareholder derivative lawsuits. For example, a derivative complaint must allege the plaintiff’s standing as a shareholder at all relevant times. Demand upon the...more

Farrell Fritz, P.C.

And the Award For Most Oppressive Conduct By a Majority Shareholder Goes to . . .

Farrell Fritz, P.C. on

Over the years I’ve litigated and observed countless cases of alleged oppression of minority shareholders by the majority. Oppression can take endlessly different forms, some more crude than others in their execution, some...more

Morris James LLP

Court Upholds Stockholder's Share Ownership and Books-and-Records Request

Morris James LLP on

Companies often defend against stockholder requests to inspect books and records by contending that the plaintiff stockholder lacks a proper purpose or that his or her stated purpose is not the real purpose. Less common is a...more

A&O Shearman

Delaware Chancery Court Holds That Former Stockholders Lack Post-Merger Standing To Bring Mismanagement Claims

A&O Shearman on

On May 4, 2017, Chancellor Andre G. Bouchard of the Delaware Court of Chancery dismissed for lack of post-merger standing an action by former stockholders of Massey Energy Company (“Massey”) against its former officers and...more

Sheppard Mullin Richter & Hampton LLP

Delaware Court of Chancery Holds that Cancellation of Shares Through Merger Deprives Stockholder of Standing in Section 220 Action

In Weingarten v. Monster Worldwide, Inc., C.A. No. 12931-VCG, 2017 WL 752179 (Del. Ch. Feb. 27, 2017), the Delaware Court of Chancery (Glasscock, V.C.) clarified when a plaintiff has standing to vitiate inspection rights...more

Morris James LLP

Court Of Chancery Denies Standing After Spin-Off

Morris James LLP on

After a spin–off of a subsidiary, there is a question as to whether the subsidiary’s stockholders have standing to bring a derivative suit on behalf of the subsidiary for past wrongs against the subsidiary committed by the...more

Allen Matkins

Federal Court Rejects Court Of Chancery’s Privity Analysis

Allen Matkins on

Two years ago, I wrote about La. Mun. Police Emples. Ret. Sys. v. Pyott, 46 A.3d 313 (Del. Ch. 2012) in which Vice Chancellor J. Travis Laster refused to give preclusive effect to federal district court’s dismissal of a...more

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