DanZale2000
TUG Member
Diamond Resorts was mismanaged says Stephen Cloobeck.
Board of Directors materially mislead its stockholders says the Delaware Supreme Court (Diamond Resorts International, Inc., is a Delaware corporation).
The Delaware Supreme Court held (on Feb. 20, 2018):
"On June 26, 2016, the Diamond Resorts board voted in favor of the company's sale to Apollo. But Cloobeck abstained from that vote. In not one, but two board meetings, Cloobeck said that he was abstaining because mismanagement of Diamond Resorts had negatively affected the sale price and it was therefore not the right time to sell the company."
"In its lengthy ... Recommendation Statement (the "14D-9") recommending that stockholders tender their shares to Apollo, the board did not disclose to stockholders the reasons for Cloobeck's abstention."
"Regardless of the board's reason for omitting Cloobeck's concerns from the disclosures, the omitted facts are material and their omission precludes the invocation of the business judgment rule standard at the pleading stage."
http://www.pepperlaw.com/publicatio...ehind-a-directors-vote-abstention-2018-03-28/
https://courts.delaware.gov/Opinions/Download.aspx?id=269180
Board of Directors materially mislead its stockholders says the Delaware Supreme Court (Diamond Resorts International, Inc., is a Delaware corporation).
The Delaware Supreme Court held (on Feb. 20, 2018):
"On June 26, 2016, the Diamond Resorts board voted in favor of the company's sale to Apollo. But Cloobeck abstained from that vote. In not one, but two board meetings, Cloobeck said that he was abstaining because mismanagement of Diamond Resorts had negatively affected the sale price and it was therefore not the right time to sell the company."
"In its lengthy ... Recommendation Statement (the "14D-9") recommending that stockholders tender their shares to Apollo, the board did not disclose to stockholders the reasons for Cloobeck's abstention."
"Regardless of the board's reason for omitting Cloobeck's concerns from the disclosures, the omitted facts are material and their omission precludes the invocation of the business judgment rule standard at the pleading stage."
http://www.pepperlaw.com/publicatio...ehind-a-directors-vote-abstention-2018-03-28/
https://courts.delaware.gov/Opinions/Download.aspx?id=269180