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Court Of Chancery Decides It Will Determine Stock Validity In A Section 225 Case

Posted In Directors

Southpaw Credit Opportunity Master Fund L.P. v. Roma Restaurant Holdings Inc., C.A. No. 2017-0059-TMR (Oct. 13, 2017)

In a contest over who has been elected to a board of directors under Section 225 of the DGCL, it is sometimes critical to decide if certain stock was validly issued and thus can be voted. This decision sets out a circumstance when that issue may be determined in Section 225 case even when the holders of the contested stock are not parties to the litigation.

Tags: Directors