Justia Nevada Supreme Court Opinion SummariesArticles Posted in Mergers & Acquisitions
Smith v. Kisorin USA, Inc.
Appellants Wade and Brenda Smith owned shares of common stock in Pachinko World. Cede & Co. held the shares in street name, making appellants the beneficial owners. After Pachinko World merged into Kisorin, Kisorin sent out a dissenters' rights notice to the minority stockholders. Instead of giving direct notice to appellants, Kisorin provided Cede & Co. with the dissenter's notice. As a result, appellants sent their dissenter's demand forms outside the 45-day period allotted. Kisorin informed appellants that Wade Smith's demand for payment was past due and he would be paid the merger consideration set forth in the notice. Kisorin subsequently filed a petition in the district court for a declaratory judgment. Both parties then moved for summary judgment. The district court entered summary judgment against appellants, and appellants appealed. At issue was whether a corporation is required to deliver a dissenters' rights notice to all stockholders, irrespective of whether the stockholders hold the stock in street name or are beneficial stockholders. The Supreme Court affirmed, holding that due to the impracticality of delivering notice to beneficial owners, Nevada corporations are required to send dissenters' notices only to record stockholders, including those holding the stock in street name. View "Smith v. Kisorin USA, Inc." on Justia Law