Mills v. Electronic Auto-Lite Co., 396 U.S. 375 (1970)
You.S. Best Court
Petitioners, minority investors away from respondent Digital Auto-Lite Co., lead this action derivatively and on part from fraction shareholders just like the a class to set away an excellent merger regarding Car-Lite and also the Mergenthaler Linotype Co. (and this, before the merger, had more 50 % of Car-Lite’s inventory). Petitioners energized the proxy solicitation into merger by Auto-Lite’s management is actually materially misleading, and you will broken § 14(a) of your own Securities Replace Act out-of 1934 and you may Rule 14a-9 thereunder for the colombian cupid Inloggen reason that new merger try recommended so you can Vehicles-Lite’s investors because of the you to definitely organization’s administrators instead their disclosing which they were all the nominees regarding and you can subject to Mergenthaler. The brand new Section Judge, to your petitioners’ actions to own realization wisdom, governed that the advertised problem on the proxy declaration try an excellent matter omission, and, just after a paying attention, determined that, without having any votes off minority stockholders, recognition of your merger couldn’t was in fact attained, hence a good causal relationships got hence proven between the looking out-of an excellent § 14(a) solution together with so-called harm to petitioners. Brand new legal known the situation to a master to adopt compatible save. Into the interlocutory attract, the brand new Judge out of Appeals confirmed the finish that proxy report is actually materially deficient, but stored that the granting out-of summary wisdom with respect to causation is incorrect, and this are needed to manage in the demonstration if or not truth be told there is good causal relationships amongst the deficiency in the proxy statement additionally the merger.