3rd Circ. Says Board Observers Not Same As Directors

Law360 (July 23, 2019, 10:08 PM EDT) -- The Third Circuit threw out on Tuesday investors' last remaining claim against two men allegedly liable for misrepresentations about a company's financial well-being ahead of its public debut, finding that board observers, who don't have voting rights, are distinct from directors.

In a precedential opinion, two members of a three-judge panel cleared L. McCarthy Downs III and Hayden Zou of wrongdoing related to the holding company Tibet Pharmaceuticals Inc.'s initial public offering in 2011. The duo was among a number of defendants accused of hiding material information ahead of the IPO, including the company's need to repay a loan that it...

Stay ahead of the curve

In the legal profession, information is the key to success. You have to know what’s happening with clients, competitors, practice areas, and industries. Law360 provides the intelligence you need to remain an expert and beat the competition.


  • Access to case data within articles (numbers, filings, courts, nature of suit, and more.)
  • Access to attached documents such as briefs, petitions, complaints, decisions, motions, etc.
  • Create custom alerts for specific article and case topics and so much more!

TRY LAW360 FREE FOR SEVEN DAYS

Hello! I'm Law360's automated support bot.

How can I help you today?

For example, you can type:
  • I forgot my password
  • I took a free trial but didn't get a verification email
  • How do I sign up for a newsletter?
Beta
Ask a question!