Busse v. United Panam Financial Corp.

(California Court of Appeal) – Dismissal of an action brought by plaintiff-minority shareholders for “rescissionary damages” based on breach of fiduciary duty by defendants with respect to a proposed buyout of defendant-company, is: 1) affirmed in part, where under Corporations Code section 1312(b), in common control situations, dissenting minority shareholders have the remedy of appraisal unless they elect the remedy of stopping or rescinding the reorganization but they do not have any right to sue for damages for breach of fiduciary duty; but 2) reversed in part and remanded, where plaintiffs have never withdrawn their alternative request to set aside the merger.