KenChowder: Good question. Based on limited resear
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Posted On: 09/03/2021 6:00:39 PM
Re: KenChowder #102431
KenChowder: Good question. Based on limited research, and as implied by the last substantive paragraph of my post, my hunch is that each decision, even if contrary in outcome to the other, can and will be separately enforced.
My hunch hinges on the fact that each complaint relies on separate state and federal grounds ( state of Delaware by-laws vs federal securities laws and rules) in asserting jurisdiction in the respective courts. Under Title 8, Chapter 1 of Delaware statutes, a Delaware corporation must adopt and enforce a set of corporate by-laws. Likewise, but separately, BOD election nominating documents must comply with federal securities laws and rules.
The compliance issue in both lawsuits arises from essentially the same facts, but it strikes me that different judicial outcomes could theoretically be reached due to the possibility that compliance with one set of requirements might not ensure compliance with the other. With concurrent jurisdiction and theoretically opposite outcomes in play, my hunch is that each court will rely on principles of comity (the legal maxim for live and let live) in order not to interfere with the other court's ruling.
If I'm right above, that would give CYDY 2 bites at the apple of disallowing the 13D slate. But the huge caveat to my opinion is that most of what I have written above is off the top oof my head, and therefore very suspect. Each side has small armies of associates and junior partners pouring through legal research aimed at scrutinizing the extensive case law touching on these multi faceted procedural and jurisdictional issues. Since none of us has access to their work product, we'll likely have to wait for a more reliable answer to your question.
My hunch hinges on the fact that each complaint relies on separate state and federal grounds ( state of Delaware by-laws vs federal securities laws and rules) in asserting jurisdiction in the respective courts. Under Title 8, Chapter 1 of Delaware statutes, a Delaware corporation must adopt and enforce a set of corporate by-laws. Likewise, but separately, BOD election nominating documents must comply with federal securities laws and rules.
The compliance issue in both lawsuits arises from essentially the same facts, but it strikes me that different judicial outcomes could theoretically be reached due to the possibility that compliance with one set of requirements might not ensure compliance with the other. With concurrent jurisdiction and theoretically opposite outcomes in play, my hunch is that each court will rely on principles of comity (the legal maxim for live and let live) in order not to interfere with the other court's ruling.
If I'm right above, that would give CYDY 2 bites at the apple of disallowing the 13D slate. But the huge caveat to my opinion is that most of what I have written above is off the top oof my head, and therefore very suspect. Each side has small armies of associates and junior partners pouring through legal research aimed at scrutinizing the extensive case law touching on these multi faceted procedural and jurisdictional issues. Since none of us has access to their work product, we'll likely have to wait for a more reliable answer to your question.
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