• Majority Shareholders Who Take Part in "Squeeze-Outs" Can No Longer Count Pennsylvania as the Sanctuary It Once Was Thought to Be
  • August 14, 2012 | Author: Patrick M. Horan
  • Law Firm: Schnader Harrison Segal & Lewis LLP - Philadelphia Office
  • In reaction to a certified question from the U.S. Court of Appeals for the Third Circuit, the Pennsylvania Supreme Court recently issued an opinion which allows post-merger claims by minority shareholders when "fraud or fundamental unfairness" is present. Prior to this opinion, the generally accepted view of the law was that the only redress available to a minority shareholder following a cash-out merger was the statutory appraisal proceedings. This Alert reviews the change in the law created by the Mitchell Partners, L.P. v. Irex Corporation opinion and gives notice to those who should concern themselves with the implications.