In February, the Delaware Chancery Court issued a much discussed opinion in Kurz v. Holbrook, in which the Court gave the corporate law concept of record shareholder an expansive definition. As a Sullivan and Cromwell client memo explained: "the court ruled that banks and brokers that hold shares in street name through the DTC depositary system are the stockholders of record under Delaware law."
A couple of days ago, the Delaware Supreme Court reversed, stating that the Chancery Court's view was “obiter dictum and without precedential effect.” A Richards Layton client memo explains that:
The Supreme Court therefore expressly declined to review the Court of Chancery’s holding that the Cede breakdown constituted part of the stock ledger for purposes of 8 Del. C. § 219(c). The Supreme Court wrote that a “gratuitous statutory interpretation resolving this difficult issue” would not be “prudent,” and indicated that a legislative cure by the Delaware General Assembly to resolve the question was preferable.You can download the Delaware Supreme Court decision here.
Francis Pileggi has a nice bullet point analysis of the key issues.
