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When a publicly traded company's stock value falls due to some incident or event faced by the company, the shareholders have sued the company alleging breach of duty among other causes of action. The courts have dismissed such suits in the US.

Are there any examples of lawsuits in US/Can/EU where the shareholders have prevailed against the Corporation or its Board ?

  • The short answer is yes. Shareholders have prevailed in derivative actions although your question confuses a securities fraud lawsuit (which you describe) with a true and procedurally very different derivative action which alleges that the company failed to take action to enforce a legal right of the company to the detriment of the shareholders (often in relation to a conflict of interest in a merger situation or where senior executive engage in misconduct that the board lets slide). I'll look for example if I have time. – ohwilleke Sep 22 '17 at 23:12
  • The question doesn't make sense to me. Suppose the companys stock value fell due to some natural disaster - there can be no possible legal grounds for breach of duty there; managerial misconduct - sure - but what about the principle of limited liability? That might not look so good then - but thats what Adams Smith was arguing against. – Mozibur Ullah Jun 20 '18 at 5:21
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The short answer is yes, shareholders have prevailed in derivative actions.

But, your question confuses a direct securities fraud lawsuit (which you describe) with a true and procedurally very different derivative action which alleges that the company failed to take action to enforce a legal right of the company to the detriment of the shareholders (often in relation to a conflict of interest in a merger situation or where senior executive engage in misconduct that the board lets slide).

One relatively random example of a successful derivative action is Perlman v. Feldmann, 219 F.2d 173 (2nd Cir. 1955), cert. denied, 349 U.S. 952 (1955). The case is summarized here:

Minority shareholders brought a derivative action against the majority shareholder who had sold his control block at a premium.103 The corporation manufactured steel, and the stock sale occurred during the Korean War.104 Steel was in short supply, and the government had imposed price controls.105 The majority shareholder sold his stock to a consortium of steel users, who were then able to control to their benefit the allocation of the corporation’s steel production.106 Due to the price controls, the corporation lost no money. It did, however, lose the opportunity to build goodwill by strategically allocating its product during a time of shortage.107 To the extent the stock sale premium reflected this diversion of a corporate opportunity, the selling stockholder was liable for a breach of fiduciary duty.108 A corporate recovery would not have benefitted the selling shareholder–i.e., “those from whom the recovery is had”–but would have benefitted the parties who had induced the very breach that occasioned the recovery.109 The court accordingly ordered direct relief to the minority shareholders.110

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