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Business Organizations Keyed to Bauman
Kahn v. Sullivan
Citation:594 A.2d 48 (Del. 1991)
Occidental’s board of directors sought to make a charitable donation to build an art museum, bearing the name of the company’s chief executive and chairman (Hammer). The board established a special committee, which was formed of independent directors and disinterested directors, which was done at the suggestion of accounting groups and the company’s retained law firm. The special committee unanimously approved the proposal, then submitted the proposal for shareholder approval. Dissenting shareholders brought suit to challenge the validity of the gift, but reached a settlement agreement with the company. While the court of chancery was reviewing this proposed settlement, other dissenting shareholders brought a separate suit challenging the validity of the proposed settlement.
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