Simmons v. Sutherland
Pennsylvania Court of Common Pleas
1998 Pa. Dist. & Cnty. Dec. LEXIS 200 (1998)
- Written by Rich Walter, JD
Facts
The board of directors (defendants) of Lion Brewery, Inc. (Lion) voted to approve the company’s sale to Malt Acquiring, Inc. (MAI), which was owned by Lion’s managers. Throughout the protracted auction process, many of the directors were biased in favor of selling to MAI, but the board followed professional advice, and there was no clear indication that the board acted without due care and attention to the best interests of Lion’s shareholders, employees, suppliers, and customers. Nevertheless, dissident shareholders accused the directors of breaching their fiduciary duties and petitioned the local county court for a preliminary injunction to stop the MAI sale. The shareholders backed their pleadings with citations to Delaware’s Unocal and Revlon cases.
Rule of Law
Issue
Holding and Reasoning (Burke, J.)
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