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As I understand it, it's not. The whole thing about fiduciary duty is a bit of a meme. The board can argue that they believe that Musk will run Twitter into the
by justusthane 5y ago
As I understand it, it's not. The whole thing about fiduciary duty is a bit of a meme. The board can argue that they believe that Musk will run Twitter into the ground and in the long term not selling is a better financial move, and due to the Business Judgement Rule, the court is likely to side with them (whether or not they're actually right).
- mytailorisrich 5y agoNot working in the interests of the shareholders is a breach of the board's fiduciary duties (which is simply what I commented based on the parent comment I was replying to). The issue is indeed always to determine whether a course of action is knowingly not in the interests of the shareholders.
- motohagiography 5y ago> The whole thing about fiduciary duty is a bit of a meme. Fiduciary duty is very much a thing. The Twitter board with such a tiny amount of equity may incur risk from "honest services fraud," if they block shareholders from recieving the material and obvious value of the offer. https://en.wikipedia.org/wiki/Honest_services_fraud https://en.wikipedia.org/wiki/Honest_services_fraud
- ahtihn 5y ago> The board can argue that they believe that Musk will run Twitter into the ground They can’t argue that because it would be completely irrelevant to current shareholders. They can argue that the long term value is higher than Musk's offer.