Delaware Stockholder Rights Upheld in Delaware Bankruptcy Court
On April 1, 2015, a stockholder of chapter 11 debtor SS Body Armor I, Inc. (f/k/a Point Blank Solutions) won a hotly contested battle in the United States Bankruptcy Court for the District of Delaware. At stake was the stockholder’s right under section 211 of the Delaware General Corporation Law to demand a stockholders’ meeting to elect directors. This effort was opposed by the Company, its Official Committee of Unsecured Creditors, its Official Committee of Equity Security Holders, and a group of Class Action Plaintiffs. Representing the stockholder, Jeffrey Wisler of Connolly Gallagher argued to the Bankruptcy Court that the stockholder’s right should be enforced in the Delaware Court of Chancery, despite the pending bankruptcy case. The Bankruptcy Court agreed, issuing an Opinion and Order holding that “the proposed action in Chancery Court to compel a shareholder meeting is not barred” by the bankruptcy filing. Click here for a copy of the opinion.