IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
IN AND FOR NEW CASTLE COUNTY
ALAN RUSSELL KAHN, 1
Plaintiff, ;
V. i Civil Action No. 12339
TREMONT CORPORATION, SUSAN ;
E. ALDERTON, RICHARD J.
BOUSHKA, J. LANDIS MARTIN, ,'
GLENN R. SIMMONS, HAROLD
C. SIMMONS, MICHAEL A. ;
SNETZER, THOMAS P. STAFFORD, )
AVY H. STEIN and VALHI, INC.,
;
Defendants. 1
MEMORANDUM OPINION
Date Submitted: August 4, 1992
Date Decided: August 21, 1992
Joseph A. Rosenthal, Esquire, of ROSENTHAL, MONHAIT, GROSS & GODDESS,
P.A., Wilmington, Delaware; OF COUNSEL: SILVERMAN, HARNES, OBSTFELD
& HARNES, New York, New York; Attorneys for Plaintiff.
Jesse A. Fmkelstein, Esquire and David L. Finger, Esquire, of RICHARDS, LAYTON
& FINGER, Wiimimgton, Delaware; OF COUNSEL: Timothy R. McCormick, Esquire
and Joseph D. Cohen, Esquire, of THOMPSON & KNIGHT, Dallas, Texas; Attorneys
for Defendants Richard J. Boushka, Thomas P. Stafford, Avy H. Stein, and Tremont
Corporation.
Henry N. Hemdon, Jr., Esquim and Kent A. Jordan, Esquire, of MORRIS, JAMES,
HITCHENS & WICLLIAMS, Wilmington, Delaware; OF COUNSEL: Donald E. Scott,
Esquire and Scott R. Batter, Esquire of KIRKLAND & ELLIS, Denver, Colorado;
Attorneys for Defendants Susan E. Alderton, J. Landis Martin, Glenn R. Simmons, Harold
C. Simmons, Michael A. Snetzer and Valhi, Inc.
ALLEN, Chancellor
This derivative action challenges the fairness to Tremont Corporation of a
transaction in which it purchased from Valhi, Inc., its 44% stockholder, a 15% stock
SNIPPETS:
GLENN R. SIMMONS, HAROLD
AVY H. STEIN and VALHI, INC.,
Joseph A. Rosenthal, Esquire, of ROSENTHAL, MONHAIT, GROSS & GODDESS, P.A., Wilmington,
This derivative action challenges the fairness to Tremont Corporation of a
that .a majority of Tremont's board are directors or officers of Valhi or its
respect to the underlying transaction; that defendant Harold Simmons controls Valhi,
behalf of three directors who identified themselves as "the Special Committee";
`Standing alone this second allegation is plainly insufficient to excuse pre-suit demand
in the stock of Baroid Corporation and NL Industries, the value of NL or its stock,
Tremont of the Stock Purchase Agreement, minutes of meetings of Tremont directors
respect to fairness to Tremont of the Stock Purchase Agreement (or any purchase of NL
Defendants rhen moved to dismiss the complaint for failure to comply with Rule
The motion to dismiss has not yet been presented.
Before me at this time is the motion to stay discovery,
is relevant because in presenting that joint motion, all defendants assert factual matters
The complaint alleges that a majority of the board of Tremont is under a disabling
this pleading would seem plausibly to satisfy the apphcable legal test to excuse demand.
& Aronson v. Ied, Del.
Supr., - A.2d _ _.
subsidiaries or affiliates other than Tremont.
*I say in the first instance because when the pleading itself is sufficient to excuse
a transaction authorized by a board that is predominantly subject to a conflicting interest.
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