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Court upholds judge’s finding that Tesla acquisition of Solar City was fair
Attorney News |
2023/06/06 10:10
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Delaware’s Supreme Court has upheld a judge’s decision in favor of Tesla CEO Elon Musk in a lawsuit challenging the electric car maker’s $2.4 billion acquisition of a solar panel company founded by two of his cousins.
The court on Tuesday rejected arguments from a group of Tesla shareholders that a Chancery Court judge erred in finding that Tesla’s deal to acquire SolarCity in 2016 was “entirely fair.” The judge made that determination even while finding that the process by which Tesla’s board of directors negotiated and recommended the deal to shareholders was “far from perfect.”
While noting errors in the trial court’s fair price analysis, and agreeing that the deal process was not “pitch perfect,” the justices said the record is replete with factual findings and credibility determinations indicating that the acquisition was “entirely fair.”
“We are convinced, after a thorough review of the extensive trial record, that the trial court’s decision is supported by the evidence and that the court committed no reversible error in applying the entire fairness test,” Justice Karen Valihura wrote in the court’s 106-page opinion.
Typically, under Delaware’s “business judgment” rule, courts give deference to a corporate board’s decision-making unless there is evidence that directors had conflicts or acted in bad faith. If a plaintiff can overcome the business judgment rule’s presumption because the deal involved a controlling shareholder or because directors might have been conflicted, the board’s action is subject to an “entire fairness” analysis. That shifts the burden to the corporation to show that the deal involved both fair dealing and fair price.
At the time of the acquisition, Musk owned about 22% of Tesla’s common stock and was the largest stockholder of SolarCity, as well as chairman of its board of directors.
The justices concluded that the findings by former Vice Chancellor Joseph Slights III, which were not challenged by the shareholders, support the conclusion that the overall deal process was the product of fair dealing. The Supreme Court also said that, while Slights failed to explain why and how he relied on Solar City’s stock price on the day the deal was announced, rather than the lower price on the day the deal closed, his fair price analysis did not amount to reversible error.
“The Court of Chancery, after examining all of the expert testimony and fair price evidence, found that the fair price case was not even close,” Valihiura noted.
An attorney for the shareholders argued in March that the Chancery Court judge put too much emphasis on the price Tesla paid for SolarCity, and not enough on the deal process, which the plaintiffs contend was tainted by the failure to appoint an independent committee to negotiate the deal. He also argued that the judge’s analysis of the deal price was flawed and that shareholders who voted to approve the deal were not properly informed, even though the vote was not required under Delaware law. |
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Biden and GOP rush to finalize debt ceiling deal, shore up support to prevent default
Court Watch |
2023/06/02 11:07
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A federal appeals court in a rare move overturned the death sentence of a man who was convicted of robbing and killing two people in Fresno in 1988, saying prosecutors knowingly presented false testimony from a key witness.
The Ninth U.S. Circuit Court of Appeals in its Wednesday ruling upheld Colin Dickey’s robbery conviction and said prosecutors could decide whether to retry him for murder. Dickey remains in prison.
“This is an exceptional case in which the prosecutor deliberately elicited, and then failed to correct, false and misleading testimony from the State’s star witness,” the court said in a ruling overturning Dickey’s 1991 death sentence.
The Fresno County prosecutor elicited the testimony from key witness Gene Buchanan, who told the jury he had not met with prosecutors or accepted any benefits from them. In fact, the court said, they had met a dozen times during the investigation, and the district attorney’s office had dismissed drug charges against him and helped him collect a $5,000 reward for implicating Dickey, one of his roommates.
Dickey was convicted in the murders of two neighbors, Marie Caton, 76, and Louis Freiri, 67, who were beaten and stabbed to death in November 1988 at Caton’s home in Fresno, where Freiri was a boarder, the San Francisco Chronicle reported.
Both Dickey and Buchanan lived with Caton’s grandson, Richard Cullumber, who according to witnesses was a drug user who frequently requested money from Caton. Five days after the attack, the court said, Cullumber fled police in a car, said he had “killed a woman,” was cornered after a high-speed chase and shot himself to death.
According to another roommate, Dickey said he had gone to Caton’s house with Cullumber to help him get the money but had nothing to do with the killings. But Buchanan testified that Dickey told him he was at the scene of the attacks, saw Freiri lying with his head slumped down, and decided that “if you kill one you might as well kill them both.”
Buchanan’s testimony “was the centerpiece of the state’s case” and without his dubious statements, “the state’s case against Dickey was weak” and lacked any direct evidence of intent to kill, Judge Morgan Christen said in the 3-0 ruling. |
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Biden and McCarthy reach a final deal and now must sell it to Congress
Topics in Legal News |
2023/05/29 10:31
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With days to spare before a potential first-ever government default, President Joe Biden and House Speaker Kevin McCarthy reached final agreement Sunday on a deal to raise the nation’s debt ceiling and worked to ensure enough support in Congress to pass the measure in the coming week.
The Democratic president and Republican speaker spoke late in the day as negotiators rushed to draft and post the bill text for review, with compromises that neither the hard-right or left flank is likely to support. Instead, the leaders are working to gather backing from the political middle as Congress hurries toward votes before a June 5 deadline to avert a damaging federal default.
“Good news,” Biden declared Sunday evening at the White House.
“The agreement prevents the worst possible crisis, a default, for the first time in our nation’s history,” he said. “Takes the threat of a catastrophic default off the table.”
The president urged both parties in Congress to come together for swift passage. “The speaker and I made clear from the start that the only way forward was a bipartisan agreement,” he said.
The final product includes spending cuts but risks angering some lawmakers as they take a closer look at the concessions. Biden told reporters at the White House upon his return from Delaware that he was confident the plan will make it to his desk.
McCarthy, too, was confident in remarks at the Capitol: “At the end of the day, people can look together to be able to pass this.”
The days ahead will determine whether Washington is again able to narrowly avoid a default on U.S. debt, as it has done many times before, or whether the global economy enters a potential crisis.
In the United States, a default could cause financial markets to freeze up and spark an international financial crisis. Analysts say millions of jobs would vanish, borrowing and unemployment rates would jump, and a stock-market plunge could erase trillions of dollars in household wealth. It would all but shatter the $24 trillion market for Treasury debt.
Anxious retirees and others were already making contingency plans for missed checks, with the next Social Security payments due soon as the world watches American leadership at stake.
McCarthy and his negotiators portrayed the deal as delivering for Republicans though it fell well short of the sweeping spending cuts they sought. Top White House officials were briefing Democratic lawmakers and phoning some directly to try to shore up support.
One surprise was a provision important to influential Sen. Joe Manchin, D-W.Va., giving congressional backing for the controversial Mountain Valley Pipeline, a natural gas project, that is certain to raise questions. |
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Islamic scholar acquitted of rape by Swiss court
Attorney News |
2023/05/24 12:11
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A Swiss court on Wednesday acquitted noted Islamic scholar Tariq Ramadan on charges of rape and “sexual constraint,” citing lack of material evidence more than a decade after the alleged actions, contradictory witness statements and what resembled love messages to the accused.
The court said it would pay Ramadan’s lawyers’ fees. It was a first victory for the former Oxford scholar with a worldwide reputation who had a brutal fall from grace with similar accusations still pending in France.
Ramadan faces potential trial in France over allegations by several other women that emerged more than five years ago.
Ramadan, a Swiss citizen, was jailed in February 2018 in France and handed preliminary rape charges over two alleged assaults in France, one in 2009 and another in 2012. A third woman filed a rape complaint against him in March. He was released on bail nine months later.
The outspoken scholar has consistently denied any wrongdoing and filed a lawsuit saying the allegations were false.
In the Swiss case, the court noted that it didn’t pass judgment on Ramadan’s sexual practices or his morality. A statement said the plaintiff’s accusations weren’t corroborated by any material elements, including traces of sperm or blood. It also considered the “the numerous internet exchanges” between the Swiss plaintiff and several people implicated in the French case were “of a nature to influence” what she and witnesses told the court.
The court said that messages the plaintiff exchanged with Ramadan immediately after the acts in question and for weeks later appear more like “messages of love and, above all, make no mention” of her allegations during a night at a hotel.
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Russia indicts ICC prosecutor, judge who issued war crimes
Opinions |
2023/05/22 13:03
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Russia on Sunday announced indictments in absentia for a judge and prosecutor of the International Criminal Court who issued a war crimes warrant for President Vladimir Putin.
A statement from the national Investigative Committee said the judge, Rosario Salvatore Aitala, and prosecutor Khan Karim Asad Ahmad are both charged with “preparing to attack a representative of a foreign country enjoying international protection in order to complicate international relations.”
Each also faces other charges. Conviction could bring prison terms of up to 12 years. The committee also said other ICC officials are being investigated.
The March warrant against Putin accuses him of personal responsibility for the abductions of children from Ukraine. The court also charged Maria Lvova-Belova, the Russian presidential commissioner for children’s rights.
It was the first time the global court has issued a warrant against a leader of one of the five permanent members of the U.N. Security Council. |
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