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Corporations Keyed to Rhee
RBC Capital Markets, LLC v. Jervis
Citation:
RBC Capital Markets, LLC v. JervisFacts
RBC Capital, an investment bank, was engaged to advise Rural/Metro Corporation in its sale to a private equity firm, Warburg Pincus. Rural’s negotiating committee believed that Warburg’s offer for acquisition was inadequate and recommended that the Rural borad not accept the offer. Rural had seven directors, though one did not vote on the sale to Warburg. Before the meeting, RBC aligned itself with Rural’s CEO, DeMino, who was also a director. Another board member, Shackelton, was the managing partner of a hedge fund with a substantial ownership position in Rural who was eager to monetize its holdings in Rural through an M&A event. A third director, Davis, was under growing pressure from ISS because he served on too many corporate boards. Shareholders sued alleging the directors breached their duty of loyalty and joined RBC as an aider and abettor.
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Topic Resources
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Directors Officers