The Supreme Court injects federalism into the implied private right of action for breach of Securities and Exchange Commission rule 14-a9. A taste of things to come?
Article Abstract:
The US Supreme Court's opinion in Virginia Bankshares, Inc. v. Sandberg held that minority shareholders had no private remedy against a corporation, though induced by majority shareholders' fraudulent proxy solicitation statements to consent to a leveraged buyout, since their minority share status prevented them from blocking the harmful merger. The Court, seizing on this inability to prove the proxy fraud, and not the minority status, caused the economic injury, erroneously interpreted the Securities and Exchange Act as depriving injured shareholders a fraud remedy under state law. It correctly decided the forced buyout price owed minority shareholders in a merger situation.
Publication Name: Delaware Journal of Corporate Law
Subject: Law
ISSN: 0364-9490
Year: 1992
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Appraising dissenters' shares: the "fair value" of Technicolor
Article Abstract:
The Delaware Supreme Court ruled in Cede & Co. v. Technicolor, Inc. that increases in value occurring during the period between the first and second steps of a two-step merger must be factored in to the fair value of dissenting shares. The increases in value at issue occurred as a result of the implementation of business plans. The Court's ruling focused on nonspeculative increases in value, and it did not address changes in value that may result from the synergy of the merger. The decision is not likely to deter future mergers.
Publication Name: Delaware Journal of Corporate Law
Subject: Law
ISSN: 0364-9490
Year: 1997
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A major step toward clarifying the role of independent committees
Article Abstract:
The 1994 Delaware Supreme Court decision in Kahn v. Lynch Communications Systems held the entire fairness standard settlement to be universally applicable in litigation arising in mergers directed by controlling shareholders. The decision also stated negotiating committees must remain impartial. After Kahn, such committees remain useful in reviewing controlling shareholder's actions, but are less likely to shift the burden of proof of unfairness.
Publication Name: Delaware Journal of Corporate Law
Subject: Law
ISSN: 0364-9490
Year: 1995
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- Abstracts: The year in review: significant judicial developments. Recent legislative developments affecting the work of the Securities and Exchange Commission
- Abstracts: Overview of securities litigation reform. Underwriters' counsel in the current capital markets environment. Due diligence procedures of issuers' representatives in the modern underwriting environment
- Abstracts: The revised proxy rules: an unfinished effort to improve shareholder communication. Shareholder initiatives, institutional investors and the SEC: 14A-8 proposals and new proxy rules
- Abstracts: The authority of a debtor to place substantially similar claims into separate classes in order to cram down a reorganization plan: should a bright line rule requiring all substantially similar claims to be placed into a single class be adopted?
- Abstracts: Recovery of unconstitutional taxes: a new approach. Section 304 and the limits of statutory law. Reexamining continuity of shareholder interest in corporate reorganizations