Following years of litigation against former employees in two related lawsuits, a privately-held company received troubling rulings: the trial court ordered the company “to cause” its parent company to redeem stock issued by the parent company to the two individuals. The trial court did not make any ruling against the parent company, which was not a party to the lawsuits, or against our client related to the stock. As is typically the case, Waller’s client did not have authority to cause its parent company, a separate legal entity, to redeem the stock that the parent company had issued.
Waller was engaged following the trial court’s ruling, and successfully obtained stays of the judgments and proceeded to appeal the trial court’s rulings. The Court of Appeals agreed with our client’s position that it could not cause its parent company to redeem stock issued by the parent company. The Court of Appeals ruled that there was no securities fraud by our client or its parent and that there was no basis to compel our client or its parent to redeem the stock.
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