The Court denied a motion for preliminary injunction in this litigation involving the merger of Wachovia and Wells Fargo.
The principal holdings of the decision were that (1) the Wachovia Board of Directors, in approving the merger deal, satisfied its obligations under the Business Judgment Rule in light of the dire economic circumstances and lack of alternatives faced by the Board, (2) the Board complied with North Carolina law in the issuance of new shares of stock to Wells Fargo which gave it 39.9% of the voting control over Wachovia, and (3) the grant of this voting bloc was not coercive to Wachovia’s shareholders.
The Court also found, however, that the continuation of Wells Fargo’s right to vote these shares for an 18 month period if the Wachovia shareholders were to reject the merger was invalid.
There’s a more complete summary of the Court’s opinion here.
Brief in Support of Motion for Preliminary Injunction
Wachovia Brief in Opposition to Motion for Preliminary Injunction
Wells Fargo Brief in Opposition to Motion for Preliminary Injunction
Reply Brief in Support of Motion for Preliminary Injunction
Wachovia Sur-Reply in Opposition fo Motion for Preliminary Injunction