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Page 1238
501 A.2d 1238 
Mary G. DALTON, Individually and as
Custodian for Robert A.
Dalton, James T. Dalton and John A. Dalton
Under the Uniform
Gifts to Minors Act, Richard T. Dalton,
Individually and as
Custodian for Robert A. Dalton and James T.
Dalton, Under
the Uniform Gifts to Minors Act, Randy
Dalton, Robert
Fisher, Bonnie Fisher, Individually and as
Custodian for
Robert Cassett Fisher, Jacqueline Fisher,
and Caroline
Fisher Under the Uniform Gifts to Minors
Act, Babette Louis,
Irene and Babette Louis, Louis K. Cassett,
Myrtle Cassett,
Dorothy Cassett, Banner Finance of Houston,
Inc., Banner
Finance of Rossville, Inc., and Banner
Finance of Dallas,
Inc., Plaintiffs Below, Appellants,
v.
AMERICAN INVESTMENT COMPANY, A Delaware
Corporation, and
Robert J. Brockman, Earl R. Tweedie, Warren
E. Van Norman,
James D. Barnes, Erwin A. Stuebner, Norfleet
H. Rand, Basil
L. Kaufman, Henry R. Barber, Albert J.
O'Brien, M. Moss
Alexander, Jr., Charles A. Specht, Francis
Peter Cundill,
Patrick M. Donelan, Alan G. Johnson and
Leucadia American
Corp., A Delaware Corporation, Defendants
Below, Appellees. Supreme Court of Delaware.
Submitted Nov. 14, 1985.
Decided Dec. 30, 1985. Upon appeal from Court of
Chancery. Affirmed.
Bruce M. Stargatt (argued) and
David C. McBride of Young, Conaway, Stargatt
& Taylor, Wilmington, and Bryan, Cave,
McPheeters & McRoberts, St. Louis, Mo., of
counsel, for plaintiffs below, appellants.
David A. Drexler (argued) of
Morris, Nichols, Arsht & Tunnell,
Wilmington, for American Inv. Co. and
individual defendants, defendants below,
appellees.
R. Franklin Balotti (argued) of
Richards, Layton & Finger, Wilmington, and
Dennis
Page 1239 J. Block, Sanford F. Remz and Stephen A.
Radin of Weil, Gotshal & Manges, New York
City, of counsel, for Leucadia American
Corp., defendant below, appellee.
Before McNEILLY, HORSEY and
MOORE, JJ.
This appeal is from a decision of
the Court of Chancery in favor of defendants
in an action by certain preference
stockholders seeking to enjoin the merger of
American Investment Company (AIC) and
Leucadia American Corp. (Leucadia American),
a subsidiary of Leucadia, Inc. (Leucadia),
and, after a request for preliminary
injunction was denied, claiming money
damages.
The essence of appellants' claim
is that the AIC Board of Directors, all of
whom were common stockholders of AIC and a
majority of whom represented the largest
common stockholders of AIC, breached the
fiduciary duties of AIC and the Board
members, by conducting negotiations with
Leucadia with the purpose and effect of
maximizing the per share return to the
common stockholders to the exclusion of the
preference shareholders who were unfairly
frozen in as shareholders in the surviving
corporation.
The factual findings of the
Chancellor are set forth in great detail in
the Court's reported opinion. Dalton v.
American Investment Company, Del.Ch.,
490 A.2d 574 (1985). The Chancellor's findings
clearly are supported by the record. We
adopt those findings and conclusions drawn
therefrom as if they were our own. The
Chancellor's excellent opinion is a model of
thoroughness and clarity. To the extent the
issues on appeal are issues of law, the
issues are the same as were raised in the
Court of Chancery and are controlled by
settled Delaware law. To the extent the
issues on appeal are matters of judicial
discretion, there appears no abuse of that
discretion. Therefore, for the reasons
stated in the opinion of the Court of
Chancery, we AFFIRM. |
