Aronson v. Lewis
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| Aronson v. Lewis | |
|---|---|
 | |
| Court | Delaware Supreme Court |
| Decided | March 1, 1984 |
| Citation(s) | 473 A.2d 805 |
| Court membership | |
| Judge(s) sitting | John J. McNeilly, Andrew G. T. Moore II, Andrew D. Christie |
| Case opinions | |
| Decision by | Moore |
| Keywords | |
Aronson v Lewis, 473 A.2d 805 (Del. 1984),[1] is a US corporate law case, from Delaware concerning the possibility of a shareholder to bring a derivative suit.
Facts[edit]
A shareholder claimed that the directors of Meyers Parking System Inc. had improperly wasted corporate assets. The CEO, Mr Fink, then 75 years old, was also a 47% shareholder and its founder. It was alleged he personally selected the other directors. They had given to Mr Fink a generous five year employment contract, a subsequent term as a consultant with a large salary, and an annual bonus equal to 5% of the company's pre tax profits. The contract also said that this continued regardless of Mr Fink's continued ability to perform the job.
Judgment[edit]
Justice Moore rejected the claim on the ground that the plaintiff had not shown that making a demand on the board would have been futile. He held that the 'business judgment rule' was applicable. This meant,
a presumption that in making a business decision, the directors of a corporation acted on an informed basis in good faith and in the honest belief that the action was taken in the best interests of the company.[2]
See also[edit]
References[edit]
- ^ Aronson v. Lewis, 473 A.2d 805 (Del. 1984).
This article incorporates text from this source, which is in the public domain. - ^ Aronson, 473 A.2d at 812.
External links[edit]
- Text of Aronson v Lewis, 473 A.2d 805 (Del. 1984) is available from: CourtListener Google Scholar Justia