Friday, October 12, 2012

In re: eBay Shareholders Litigation case brief

 In re: eBay Shareholders Litigation (Del. Ch. Ct. 2004)
  • The court held that certain eBay directors and officers usurped a corporate opportunity by taking lucrative IPO offerings made by Goldman Sachs, an investment bank that regularly did business with eBay.
  • Defendants argue that this means every investment opportunity that comes to an officer or director will be considered a corporate opportunity.
  • On the contrary, the court believes these circumstances to be quite unique.
    • Goldman Sachs was offering these highly profitable opportunities to maintain and secure corporate business (basically bribing eBay for future business).
    • This was not a case of merely “a broker’s investment recommendations” to a wealthy client.

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