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In Blaustein v. Lord Baltimore Capital Corp., No. 272, 2013, 2014 Del. LEXIS 30 (Del. Jan. 21, 2014), the Delaware Supreme Court held that a closely-held corporation’s directors owe no fiduciary duty to decide, free from conflicts of interest, whether a corporation will repurchase a minority stockholder’s shares in the corporation.  Additionally, the Supreme Court held that the implied covenant of good faith and fair dealing contained in a shareholders agreement did not give a minority stockholder the right to a good faith, conflict-free negotiation over the repurchase of her stock.  If a minority stockholder wishes to have the right to put his or her stock to the corporation at a fair price to be set through negotiations with independent and disinterested decision makers at the corporation, the stockholder must contract for that right expressly in advance.
Continue Reading Delaware Supreme Court Holds That a Minority Stockholder Has No Common Law Right to a Conflict-Free Board Decision Regarding the Repurchase of Shares

In Daimler AG v. Bauman, No. 11-965, 2014 U.S. LEXIS 644 (U.S. Jan. 14, 2014) (Ginsburg, J.), the Supreme Court of the United States held that a court may not exercise general personal jurisdiction over a non-U.S. corporation unless that corporation’s contacts with the forum state are so continuous and systematic as to render the corporation “at home” there.  The Supreme Court also held that a non-U.S. corporation will not be subject to a state’s general jurisdiction simply because the corporation’s subsidiary is “at home” in the forum state and the subsidiary’s contacts with the state are imputed to the corporation.  Daimler limits the situations under which a large, multinational corporation will be subject to general personal jurisdiction.  As a result, plaintiffs may have more difficulty establishing jurisdiction over an foreign corporation when the claims sued upon do not arise in or relate to the forum state.
Continue Reading United States Supreme Court Holds That Non-U.S. Corporations Are Subject to General Personal Jurisdiction in U.S. States Only in States Where They Are “At Home”

In Busse v. United Panam Fin. Corp., No. G046805, 2014 Cal. App. LEXIS 11 (Cal. App. Jan. 8, 2014), the California Court of Appeal, Fourth Appellate District, held that when parties to a buyout are under common control, dissenting minority shareholders have the right to set aside or rescind an invalid corporate buyout under Section 1312(b) of the California Corporations Code.  The Court also held that dissenting minority shareholders may not seek monetary damages under Section 1312(b).  This decision clarifies that Section 1312(b) acts as a limited exception to Section 1312(a) of the California Corporations Code by providing dissenting shareholders not only with the general remedy of appraisal, but also with the right to stop or rescind a buyout if the transaction is invalid.  Furthermore, Busse emphasizes that dissenting shareholders may not seek damages arising out of a buyout, even in common control situations.
Continue Reading California Court of Appeal Clarifies Rights of Dissenting Minority Shareholders Under California Corporation Code § 1312(b)

In Atlantic Marine Construction Co., Inc. v. United States Dist. Ct. for W.D. Tex., No. 12-929, 2013 U.S. LEXIS 8775 (U.S. Dec. 3, 2013), the Supreme Court of the United States held unanimously that when parties have agreed contractually to a valid forum-selection clause, the analysis for a motion to transfer venue under 28 U.S.C. § 1404(a) is adjusted as follows:  (1) a court should give no weight to the plaintiff’s choice of forum; (2) a court should not consider arguments about the parties’ private interests; and (3) if a court transfers a case to the parties’ preselected venue, the transferee court will not carry with it the transferring venue’s choice-of-law rules.  This adjusted Section 1404(a) analysis requires near absolute deference to the forum designated in a valid contractual forum-selection clause.  As a result, in all but the most unusual cases a district court will transfer venue to the preselected forum.
Continue Reading United States Supreme Court Holds that Contractual Forum-Selection Clauses Deserve Near Absolute Deference In Considering Changes of Venue Under 28 U.S.C. § 1404(a)