News & Analysis as of

Dilution › Breach of Duty

Cooley LLP

In Rare Dismissal of Up-C Reorganization Case, Chancery Court Holds That Claim Is Derivative, Not Direct 

Cooley LLP on

On April 10, 2025, the Delaware Court of Chancery granted a motion to dismiss in a breach of fiduciary duty action arising from BGC’s conversion from an Up-C corporation to a traditional full C corporation. While multiple...more

Holland & Knight LLP

Arkansas Court Declines to Dismiss Challenge to ESOP Releveraging Transaction

Holland & Knight LLP on

The U.S. District Court for the Western District of Arkansas issued its written decision in Shipp v. Central States Manufacturing, Inc. on July 5, 2024, declining to dismiss the case against Central States Manufacturing Inc....more

Robson & Robson, P.C.

The Hazards of 'Weaponizing' Capital Call and Dilution Provisions

Robson & Robson, P.C. on

There are many ways that an owner of a closely-held business can use their superior financial resources to gain an advantage over their co-owners in a dispute. One common way is the use of a capital call provision to dilute...more

Hogan Lovells

Brookfield Asset Management Inc. v. Rosson: Gentile overturned, eliminating dual-natured claims

Hogan Lovells on

In Brookfield Asset Management Inc. v. Rosson, the Delaware Supreme Court unanimously overturned its 2006 decision in Gentile v. Rossette, thereby eliminating the dual nature “Gentile carve-out” that allowed for both direct...more

Farrell Fritz, P.C.

Court Enjoins Dilution of Brewing Company LLC Membership Interest

Farrell Fritz, P.C. on

Most folks associate beer with pleasure. Many craft brewers will tell you they went into business for that reason: to make themselves and others happy (and, oh yeah, make money). ...more

A&O Shearman

Delaware Court Of Chancery Validates Ratification Of Defective Corporate Acts Impacting Merger And Declines To Expand Universe Of...

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On August 17, 2018, Chancellor Andre G. Bouchard of the Delaware Court of Chancery denied all of plaintiffs’ claims challenging a series of transactions culminating in the acquisition of defendant Design Within Reach, Inc....more

A&O Shearman

Second Circuit Affirms Dismissal Of Shareholder Suit, Finding Subject Matter Jurisdiction Was Properly Exercised, Equity Dilution...

A&O Shearman on

On April 26, 2017, the United States Court of Appeals for the Second Circuit affirmed the dismissal of a lawsuit brought by a shareholder of Star Bulk Carriers Corp. (“Star Bulk”) against its directors and entities affiliated...more

Sheppard Mullin Richter & Hampton LLP

Delaware Supreme Court Confirms that Dilution Claims Typically Are Derivative and Are Extinguished After a Merger

Sheppard Mullin Richter & Hampton LLP on

Stockholder claims alleging wrongful dilution are typically considered to be derivative in nature. Several decisions out of Delaware, however, have created exceptions to this general rule allowing stockholders to sue...more

Morris James LLP

Court Of Chancery Explains When A Minority Stockholder May Have Actual Control Over A Deal

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This is another in a series of decisions dealing with the allegation that a minority stockholder controlled a deal through its control of a majority of the board of directors....more

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