finding that “utilizing] the corporate machinery and the Delaware Law for the purpose of perpetuating [management] in office; and, to that end, for the purpose of obstructing the legitimate efforts of dissident stockholders in the exercise of their rights to undertake a proxy contest against management” are "inequitable purposes, contrary to established principles of corporate democracy”
How later courts described this case
- finding that “utilizing] the corporate machinery and the Delaware Law for the purpose of perpetuating [management] in office; and, to that end, for the purpose of obstructing the legitimate efforts of dissident stockholders in the exercise of their rights to undertake a proxy contest against management” are "inequitable purposes, contrary to established principles of corporate democracy”
- holding that actions taken by management to manipulate corporate machinery "for the purpose of obstructing the legitimate efforts of dissident stockholders in the exercise of their rights to undertake a proxy contest against management" were “contrary to established principles of corporate democracy” and therefore invalid
- holding a board's decision to advance the date of an annual stockholders meeting to be inequitable because the dissident stockholders had geared their campaign towards an already announced meeting date, and because between the short time allowed by the advanced meeting, the exigencies of SEC approval, and the board’s decision to hire several proxy firms, the dissident had little chance to prepare a proxy contest
- holding that plaintiffs did not unreasonably delay when they filed suit five days after unofficially learning of management’s changes to the date and location of the meeting
Written by the judges who cited it.
The opinion
WOLCOTT, Chief Justice
(dissenting) :
I do not agree with the majority of the Court in its disposition of this appeal. The plaintiff stockholders concerned in this litigation have, for a considerable period of time, sought to obtain control of the defendant corporation. These attempts took various forms.
In view of the length of time leading up to the immediate events which caused the filing of this action, I agree with the Vice Chancellor that the application for injunc-tive relief came too late.
I would affirm the judgment below on the basis of the Vice Chancellor’s opinion.