Smoke Signals: No Fiduciary Duty For Minority Shareholders — At Least Not Yet
The following excerpt is reprinted with the permission of and with credit to North Carolina Lawyers Weekly.
By Smoke has long been used for sending signals, but the North Carolina Supreme Court has sent some clear signals to stock owners while resolving a spat over smokes.
On Dec. 7 a narrowly divided court stubbed out a shareholders’ revolt over Reynolds American’s purchase of Lorillard Tobacco and reversed a Court of Appeals decision holding that a minority shareholder could owe a fiduciary duty to other shareholders. See Corwin v. British American Tobacco PLC, 2018 WL 6437701, Lawyers Weekly No. 010-093-18. But the court nevertheless strongly implied that it was inclined to accept the reasoning of Delaware courts that such a duty could exist under the right circumstances.