Related Practices
Delaware Supreme Court Recognizes Expanded Scope of Direct Shareholder Claims
William M. Lafferty, R. Judson Scaggs, Jr., Jeffrey R. Wolters
April 20, 2007
In Gatz v. Ponsoldt, 2007 WL 1120338 (Del. Apr. 16, 2007), the Delaware Supreme Court, en banc, held that public shareholders could bring direct claims, in addition to derivative claims, to challenge a series of transactions orchestrated by a controlling shareholder that transferred voting power and economic value from the public shareholders to a third party, and ultimately benefited the controlling shareholder.