Rales v. Blasband
Delaware Supreme Court
634 A.2d 927 (1993)
- Written by DeAnna Swearingen, LLM
Facts
Stephen and Mitchell Rales (defendants) were directors, officers, and majority shareholders of Easco Hand Tools, Inc. (Easco). Easco made an offering of senior subordinated notes. Part of proceeds was to be invested in government securities. Instead, the Raleses allegedly invested in junk bonds to help an investment bank with which they had a business relationship. Blasband (plaintiff) was a shareholder in Easco. Easco later became a wholly owned subsidiary of Danaher Corp. (Danaher), and Blasband became a Danaher stockholder. Blasband filed a derivative lawsuit about the Easco board’s misuse of funds. Blasband did not make demand to sue on either Easco or Danaher’s board. The Raleses are 44 percent shareholders and directors of Danaher. The third circuit held that Blasband’s complaint cast reasonable doubt on whether the Easco board exercised its business judgment. The district court certified the question to the Delaware Supreme Court to determine the demand requirements for a double derivative lawsuit under Delaware law.
Rule of Law
Issue
Holding and Reasoning (Veasey, J.)
What to do next…
Here's why 803,000 law students have relied on our case briefs:
- Written by law professors and practitioners, not other law students. 46,300 briefs, keyed to 988 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.
