COURT OF CHANCERY
O F T H E
STATE OF DELAWARE
WILLIAM T. ALLEN
Crrncr`ror November 1, 1993
Pamela S. Tikellis, Esquire
Chimicles, Burt & Jau>bsen
P. 0. Box 1035
Wilmington, Delaware 19899
R. Franklin Balotti, Esquire
Richards, Layton & Finger
P. 0. Box 551
Wilmington, Delaware 19899
R.E: Scott C. Wallace v. Stanley H. Durwood,
et al. and AMC Entertainment, Inc.,
CA. No. 12855; James M. Bird v. Stanley
EL Durwood, et al. and AMC Entertainment,
LIC.. C A.& 12939
Dear Counsel:
Presented for decision is a motion to stay discovery pending resolution of a pending but
not yet submitted motion to dismiss two cases brought derivatively against directors of AMC,
Inc. ("AMC"). An Aug;ust 17,1993 Order of Coordination of Pretrial Proceedings, consolidated
these cases for pretrial proceeding purposes.
Plaintiffs are &mreholders' of AMC, which is a Delaware corporation based in Kansas
City, Missouri. AMC operates and manages motion picture theaters nationally. Individual
defendants are Stanley H. Dunvood, AMC's founder, chief executive officer and chairman of
its board of directors; Stanley Dunvood'~ son, Edward D. Durwood, currently president and
vice chairman of the board; and Char1e.s J. Egan and Paul E. Vardeman, directors and members
`Plaintiff Scott C. Wallace is also a former senior employee of a subsidiary of AMC.
SNIPPETS:
Pamela S. Tikellis, Esquire
R. Franklin Balotti, Esquire
Scott C. Wallace v. Stanley H. Durwood,
not yet submitted motion to dismiss two cases brought derivatively against directors of AMC,
Plaintiffs are &mreholders' of AMC, which is a Delaware corporation based in Kansas
AMC operates and manages motion picture theaters nationally.
`Plaintiff Scott C. Wallace is also a former senior employee of a subsidiary of AMC.
Additionally, in one of these suits, (Bird Action)
Cohen was chairman (of the AMC ~Finance Committee.
Plaintiffs genemlly complain that the defendants have engaged in or approved self-dealing
transactions of and gross mismanagement of AMC.
to dismiss and to stay discovery.
and should be interrupted in the face of their arguably dispositive motion
According to the allegations of the complaints, AMC operates 245 theaters with 1,585
partners of American Associated Enterprises,
According to plaintiffs' allegations, Stanley Durwood, his son Edward and certain other
execute film exhibition contracts, with the result that Enterprises received .5% of all film
Durwood as part of their employment responsibilities at AMC.
that as members of the Auditing Committee,
Plaintiffs allege that Stanley Dunvocd's
A motion to stay discovery' is within the discretion of the trial court in its supervision
Fish v. Hukhinson, Del.
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