Unformatted text preview: • Have a fiduciary duty to minority shareholders • May not exclude minority shareholders from beneficial arrangements involving stock; and • Are prohibited from expelling minority shareholders, unless the expulsion is done for a legitimate business purpose 7. Congress, the NYSE, and Nasdaq have all taken steps to prevent management abuses. These new regulations require that companies adopt effective financial controls. They also require more independent directors on the board as a whole and on important subcommittees. 8. A derivative lawsuit is brought by shareholders to remedy a wrong to the corporation. The suit is brought in the name of the corporation, and all proceeds of the litigation go to the corporation. 9. If a group of shareholders all have the same claim against the corporation, they can join together and file a class action, rather than suing separately....
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- Spring '10
- Corporation, Public company, U.S. Securities and Exchange Commission, Securities and Exchange Commission