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Gall v. Exxon Corp.
U.S. District Court, Southern District of New York
418 F. Supp. 508 (1976)
In 1975 Exxon Corporation’s board of directors established a special committee to determine what action to take on allegations that Exxon paid $59 million in corporate funds as bribes or political payments to Italian political parties and others. The special committee investigated the matter, and uncovered millions of dollars of secret payments and political contributions. The special committee unanimously determined that it would be contrary to the interests of Exxon and its shareholders to maintain legal actions against any present or former Exxon director, and authorized Exxon officers to seek dismissal of shareholder derivative actions that had been instituted. In the current action, brought by shareholder Gall (plaintiff), Exxon (defendant) has moved for summary judgment dismissal of the complaint based on the special committee’s determination.
Rule of Law
Holding and Reasoning (Carter, J.)
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