In re Tri-Star Pictures, Inc., Litigation

In In re Tri-Star Pictures, Inc., Litigation, 634 A.2d 319, 330 (Del. 1993), former minority shareholders of Tri-Star Pictures, Inc., brought suit challenging a "complicated and convoluted" business combination by which the Coca-Cola Company obtained 80% ownership in Tri-Star. Id. at 320. The business combination involved voting rights agreements that had the effect of diluting the voting rights of the minority shareholders. In Loudon v. Archer Daniels Midland, the Court stated: "Tri-Star stands only for the narrow proposition that, where directors have breached their disclosure duties in a corporate transaction that has in turn caused impairment to the economic or voting rights of stockholders, there must at least be an award of nominal damages. Tri-Star should not be read to stand for any broader proposition." 700 A.2d at 142 . Later in the opinion, on the issue of damages, the Court further limited Tri-Star: "We hold that under Delaware law there is no per se rule that would allow damages for all director breaches of the fiduciary duty of disclosure." 700 A.2d at 146-47.