Mangano v. Pericor Therapeutics, Inc., No. 3777-VCN (Del. Ch. December 1, 2009), read opinion here.
This 23-page opinion of the Delaware Court of Chancery explains in great detail the factual basis of the legal issues in this case in the context of dueling motions for partial summary judgment and for partial judgment on the pleadings. The key issues addressed in this opinion are cursorily highlighted in the following bullet points:
• The definition of a “beneficial” interest in stock is analyzed. This was a key issue because when the percentage of the plaintiff’s stock ownership in the involved company dipped below 45%, it would trigger the termination of a voting trust. One of the parties argued that the 45% mark was triggered when shares were transferred by gift to a sister who was expected to vote consistent with the wishes of the transferor, although there was no written or oral agreement to support that assumption. The Court rejected the federal definition of beneficial ownership and determined that for purposes of this case and based on Delaware law, that there was no beneficial ownership of the stock involved, as defined by the Court.
• The Court made a point of noting that stock certificates are not a prerequisite to the ability of a person to possess or own stock or to vote that stock. See footnote 64.
• The Court also has a very helpful description of when a contract will be considered “unambiguous,” despite differing interpretations by the parties, for purposes of making it “ripe” for interpretation by the Court in a summary judgment motion. See footnotes 26 through 31 and accompanying text.