Piper v. Chris-Craft Industries, Inc.
United States Supreme Court
430 U.S. 1 (1977)
Chris-Craft Industries, Inc. (Chris) (plaintiff) tried to take control of Piper Aircraft Corporation (Piper) (defendant) by purchasing stock, making a cash tender offer, and making a stock exchange tender offer. Chris stopped purchasing stock on the open market after being told by Securities and Exchange Commission (SEC) officials that making such purchases while an exchange offer was pending were not permitted under SEC Rule 10b-6. Piper tried to ward off the takeover by sending letters to shareholders, issuing stock to Grumman Aircraft Corporation (Grumman) without making full disclosure to shareholders, then cancelling the Grumman deal and entering an arrangement with Bangor Punta Corporation (Bangor). Piper family members traded their 31 percent share of Piper for Bangor shares and supported an exchange tender offer by Bangor. While the Bangor offer was pending, Bangor made private purchases of Piper stock. The SEC had already announced that Rule 10b-13 would expressly prohibit such purchases, which had been previously considered barred by 10b-6. The SEC did not warn Bangor as it did Chris. Bangor and Chris continued vying for control, and ultimately Bangor held more than 50 percent of Piper stock to Chris’ 42 percent. Chris sued in district court. The court of appeals determined that Chris had standing under § 14(e) of the Williams Act and was owed damages by Piper. The district court awarded over $1.6 million in damages plus $600,000 in interest. The court of appeals reversed the damage award, setting damages at more than $25 million and calculating interest at about $10 million. Piper appealed to the United States Supreme Court.
Rule of Law
Holding and Reasoning (Burger, C.J.)
What to do next…
Unlock this case brief with a free (no-commitment) trial membership of Quimbee.
You’ll be in good company: Quimbee is one of the most widely used and trusted sites for law students, serving more than 97,000 law students since 2011. Some law schools—such as Yale, Vanderbilt, Berkeley, and the University of Illinois—even subscribe directly to Quimbee for all their law students. Read our student testimonials.
Learn more about Quimbee’s unique (and proven) approach to achieving great grades at law school.
Quimbee is a company hell-bent on one thing: helping you get an “A” in every course you take in law school, so you can graduate at the top of your class and get a high-paying law job. We’re not just a study aid for law students; we’re the study aid for law students. Read more about Quimbee.
Here's why 153,000 law students have relied on our case briefs:
- Written by law professors and practitioners, not other law students. 13,400 briefs, keyed to 183 casebooks. Top-notch customer support.
- The right amount of information, includes the facts, issues, rule of law, holding and reasoning, and any concurrences and dissents.
- Access in your classes, works on your mobile and tablet. Massive library of related video lessons and high quality multiple-choice questions.
- Easy to use, uniform format for every case brief. Written in plain English, not in legalese. Our briefs summarize and simplify; they don’t just repeat the court’s language.