Shareholder Rights and Corporate Governance
In addition to securities class actions, Bernstein Liebhard LLP is focused on protecting shareholders’ right, through actions which ensure director and officer accountability, preserve corporate assets, improve corporate disclosure, and protect shareholder voting rights and shareholder value. The Shareholder Rights and Derivative Litigation Group is also active in protecting the rights of shareholders in actions involving tender offers, mergers and acquisitions, and other transactions involving changes in control of a public company.
Through its aggressive representation, Bernstein Liebhard LLP (the “Firm”) has secured for shareholders hundreds of millions of dollars of additional consideration, as well as therapeutic changes for shareholders in the context of mergers and acquisitions. Bernstein Liebhard LLP has earned praise for the quality and integrity of its representation of shareholders in corporate takeover litigation.
A shareholder derivative action is a lawsuit brought by a shareholder of a public company, on behalf of, and for the benefit of the company for harm suffered by all shareholders. Derivative actions seek the corporate recovery of damages and/or equitable relief stemming from allegedly unlawful or improper conduct by directors, officers or other persons in control of the company. A derivative action allows shareholders to monitor and redress harm to the corporation caused by management where it is unlikely that management will redress the harm itself. A successful derivative action, in addition to the corporate recovery of damages, may include corporate governance reforms that strengthen and protect shareholder value.
The Firm believes that corporate governance reforms adopted as a result of derivative litigation will make corporate officers and directors more accountable to shareholders, inspire investor confidence in the financial markets, and protect companies and their shareholders from fraud and egregious corporate conduct.
The Firm is among the original and 2010 champions of corporate governance reform and accountability, and remains at the forefront of this important movement. In 2009 and 2010, Senior Partner Stanley D. Bernstein was named by The National Association of Corporate Directors and Directorship magazine to the “Directorship 100,” the list of “The Most Influential People in the Boardroom,” in recognition of his career at the forefront of the corporate governance reform movement. In the early 1990s, Mr. Bernstein pioneered the use of litigation to achieve corporate governance reform in In re Sears, Roebuck Derivative Litigation (Ill. Ch. Ct.). In Sears, the Firm used litigation to enhance the independence of the Sears board of directors by adding outside, non-employee directors to the board, and expanding the role of outside directors in the company’s nominating committee. Since that time, we have been among the few firms that have used litigation as a tool to gain corporate reforms and accountability.
Mergers & Acquisitions
Class actions are also brought to protect and defend the rights of public shareholders whose companies have entered into management-led buyouts, mergers, or other similar business transactions. Although directors of publicly traded companies owe their companies’ shareholders duties of care, loyalty and full and fair disclosure, takeover proposals are all too often approved by directors without properly shopping the corporation for the best price or providing shareholders with adequate information. Shareholder interests are often overlooked or completely disregarded. Bernstein Liebhard LLP has prosecuted numerous class actions on behalf of shareholders who have been unfairly or inadequately treated in a merger or business combination. Our efforts have resulted in substantial recoveries for the clients we have represented.