`< IN THE COURT OF CHANCERY OF THE SATE OF DELAWARE
IN AND FOR NEW CASTLE COUNTY
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PAUL L. KAPLAN and JEROME KAPLAN :
Individually and as Trustee For the Frank and :
Marie Hamilton Charitable Fund,
Plaintiff,
V.
PLAINS ALL AMERICAN INC., GREG L. ;
ARMSTRONG, HARRY N. PEFANIS,
PHILLIP D. KRAMER, GEORGE R. COINER, ;
MICHAEL R. PATTERSON, CYNTHIA A. :
FEEBACK, ROBERT V. SINNOT, and :
ARTHUR L. SMITH,
Defendants,
-and-
PLAINS ALL AMERICAN PIPELINE, L.P., a :
Delaware Limited Partnership,
N o m i n a l D e f e n d a n t . :
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COMPLAINT
Plaintiffs by their attorneys, allege upon information and belief as follows:
PARTIES
1. Plaintiffs own and have owned units of limited partnership interest in
nominal Defendant, Plains All American Pipeline, L.P. (the "Partnership").
2. Nominal defendant Plains All American Pipeline, L.P. is a Delaware limited
partnership with its principal place of business in Houston, Texas. The Partnership was
formed on September 17, 1998 to acquire, own and operate interstate crude oil pipeline
assets and operations and the terminating, storage and gathering and marketing assets
SNIPPETS:
allege upon information and belief as follows:
nominal Defendant, Plains All American Pipeline, L.P..
partnership with its principal place of business in Houston,
assets and operations and the terminating, storage and gathering and marketing assets
of Plains Resources, Inc. and its subsidiaries ("Plains
Plaintiffs bring this action derivatively on behalf of the Partnership,
General Partner and its affiliates own approximately 6.7 million common units and 10
Management and operation of the Partnership is provided by the
Armstrong also has been President, Chief
Executive Officer and a Director of Plains Resources since 1992.
Defendant Phillip D. Kramer is Executive Vice President,
Defendants Smith and Sinnott are members of the Audit Committee which
internal auditing and the quality of the Partnership's accounting systems.
that internal controls were similarly inadequate and they thereby knowingly or recklessly
permitted wrongful activity to take place.
$160 million loss due to "unauthorized" short selling of crude oil by an employee,
The losses caused the Partnership to renegotiate its major credit facilities,
Further, following the announcement of the loss, the trading price
benefiting those who have placed short-sell trades on crude oil.
The General Partner and its directors owe the Partnership and its public
To manage, conduct, supervise and direct the employees,
To exercise reasonable control and supervision over the officers
To ensure the prudence and soundness of policies and practices
damages sustained by the Partnership by reason of the acts and omissions to act
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