March 14, 2013
Authored by: Bryan Cave
Tom Richey’s annual survey of decisions handed down during 2012 by the state and federal courts on Georgia corporate and business organization issues is available. This survey covers the legal principles governing Georgia businesses, their management and ownership. It catalogs decisions ruling on issues of corporate, partnership and limited liability company law, as well as transactions and litigation issues involving those entities, their governance and investments in them. In 2012, the courts decided cases involving the effect of a reliance clause on claims for oral misrepresentations in a private placement and whether communications to all shareholders can support a holding claim. Federal courts handed down multiple rulings in suits brought by the FDIC regarding the business judgment rule and standard of care for bank directors and officers. Several decisions addressed unusual claims of alter ego liability between legal entities. Other cases involved shareholder buy-sell agreements; the effect of a trust indenture’s no-action clause on bondholder claims; agreements with investment bankers; partnership dissolution issues; LLC derivative action procedure; a question regarding when a lawyer representing a corporation enters into an attorney-client relationship with the corporation’s principal officer/shareholder; the admissibility of expert witness testimony on matters of corporate governance, and much more. The Survey also covers selected 2012 decisions from the Fulton Superior Court Business Court, including cases involving a challenge to a public company merger, the independence of a special litigation committee and adequacy of its investigation, and the imputation of officer and director knowledge and conduct to the corporation for purposes of an in pari delicto defense to a bankruptcy trustee’s malpractice claims against the corporation’s auditor.
This is Tom Richey’s eighth annual survey of Georgia corporate and business organization case law developments. Mr. Richey and co-author Mike Carey practice in Bryan Cave’s Securities Litigation and Enforcement Practice Group.