Calif. Minority Shareholders Can't Seek Damages Over Merger

Law360, Los Angeles (January 9, 2014, 6:17 PM EST) -- A California appeals court ruled Wednesday that a state law blocks minority shareholders in an auto loan company from seeking damages in merger litigation filed after its founder took the company private, but allows them to try to rescind the deal.

The decision sets back a bid to expand the rights of dissenting minority shareholders to sue a controlling majority for monetary damages for breach of fiduciary duty in corporate reorganizations.

Affirming part of a lower court's decision, the appellate judges determined that under California Corporations...
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