Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Ruby Resnik v. Michael J. Boskin

February 17, 2011

RUBY RESNIK,
PLAINTIFF,
v.
MICHAEL J. BOSKIN, ET AL., DEFENDANTS.



The opinion of the court was delivered by: Sheridan, U.S.D.J.

NOT FOR PUBLICATION

OPINION

This matter comes before the Court on Defendants Michael J. Boskin, et al.'s ("Defendants") motion to dismiss ("Defendants' Motion to Dismiss") Plaintiff Ruby Resnik's ("Plaintiff") verified first amended complaint ("Plaintiff's FAC").

On December 29, 2009, Plaintiff filed Plaintiff's FAC. Plaintiff alleges three causes of action in Plaintiff's FAC: (1) Defendants made materially false or misleading proxy solicitations in connection with certain Exxon Mobil Corporation ("Exxon") shareholder votes; (2) Defendants failed to seek required shareholder reapproval of a compensation plan for Exxon employees; and (3) Defendants' distribution of certain false or misleading proxy statements interfered with proper corporate governance. On March 1, 2010, the Motion to Dismiss by Defendants was filed.

For the reasons set forth below, this Court grants Defendants' Motion to Dismiss.

I

The facts of this case -- as set forth in Plaintiff's FAC and Defendants' Motion to Dismiss papers -- are as follows.

Plaintiff is currently a stockholder of Exxon. Plaintiff was a stockholder of Exxon at all times relevant to this litigation. There are a variety of defendants in this case. Plaintiff named Exxon as a defendant in this case. Exxon is a corporation organized under New Jersey laws and maintains a registered address in New Jersey. Plaintiff named the current members of Exxon's board of directors as defendants in this case (the "Exxon Directors"). In addition, Plaintiff named certain executive officers of Exxon as defendants in this case (the "Exxon Officers").

In 1997, at the time of Exxon's annual meeting, Exxon distributed a 1997 proxy statement that solicited -- and obtained -- shareholder approval of the material terms of certain performance awards that Exxon would pay as bonuses to particular Exxon executives (the "Short Term Program"). Under the Short Term Program, the maximum bonus to be granted in a single year to any recipient was not to exceed two tenths of one percent (0.2%) of Exxon's net income from operations.

In 2003, at the time of Exxon's annual meeting, Exxon distributed a 2003 proxy statement that solicited -- and obtained -- shareholder approval of the material terms of certain performance compensation that would be paid to Exxon employees (the "Program"). Exxon designed the Program "to help reward, retain, and motivate selected [Exxon] employees and to align . . . [these employees'] interests with the interests of [Exxon] shareholders through the grant of stock-based awards." Approximately 5,000 Exxon employees participate in the Program. The Program provides for a variety of stock-based compensation awards.

In 2008 and 2009, Exxon disseminated proxy statements for Exxon's annual meetings of shareholders (the "2008 and 2009 Proxy Statements"). The 2008 and 2009 Proxy Statements solicited shareholder votes for the election of the Exxon Directors, ratification of the selection of Exxon's independent auditor, and for various other proposals. According to Defendants, Exxon never asked Exxon shareholders to vote on either the Short Term Program or the Program in connection with the 2008 and 2009 Proxy Statements. In fact, Defendants maintain that Exxon did not ask Exxon shareholders to take any vote with respect to the tax treatment of compensation awarded under either the Short Term Program or the Program.

II

When evaluating a motion to dismiss for failure to state a claim, the court accepts as true all allegations in the pleading and all reasonable inferences that can be drawn therefrom, and to view such allegations and inferences in the light most favorable to the non-moving party. See Ashcroft v. Iqbal, 129 S. Ct. 1937, 1949-50 (2009); Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007); Oshiver v. Levin, Fishbein, Sedran & Berman, 38 F.3d 1380, 1384 (3d Cir. 1994). A cause of action should be dismissed only if the alleged facts, taken as true, fail to state a claim. See Iqbal, 129 S. Ct. at 1950.

While a court will accept well-pled allegations as true for the purposes of the motion to dismiss for failure to state a claim, a court will not accept bald assertions, unsupported conclusions, unwarranted inferences, or sweeping legal conclusions cast in the form of factual allegations. See Iqbal, 129 S. Ct. at 1949; Morse v. Lower Merion Sch. Dist., 132 F.3d 902, 906 (3d Cir.1997). On the contrary, "[t]he pleader is required to 'set forth sufficient information to outline the elements of [its] claim or to permit inferences to be drawn that these elements exist.'" Kost v. Kozakiewicz, 1 F.3d 176, 183 (3d Cir. 1993) (citation omitted). A party must set forth "more than an unadorned, the-defendant-unlawfully-harmed-me accusation." Iqbal, 129 S. Ct. at 1949 (citation omitted).

Plaintiff's First Cause of Action for False or Misleading Representations in Connection with the 2008 and 2009 Shareholder Votes Is Dismissed.

Plaintiff states that Plaintiff is entitled to relief because Defendants "[made] materially false or misleading proxy solicitations in connection with the 2008 and 2009 shareholder votes." Plaintiff contends as follows:

The acts of [Defendants] have injured [Plaintiff] directly by providing materially false information that the SEC specifically requires in proxy statements that solicit stockholders' proxies to elect directors and thereby depriving [Plaintiff] of the exercise of [Plaintiff's] informed corporate suffrage, including the election of directors.

Specifically, Plaintiff states that Defendants improperly solicited shareholder votes by erroneously asserting that the compensation awarded pursuant to the Short Term Program and the Program was tax-deductible.

Section 14(a) of the Securities Exchange Act of 1934 ("Section 14(a)") governs the solicitation of proxies:

It shall be unlawful for any person . . . in contravention of such rules and regulations as [the Securities Exchange Commission [the "SEC"]] may prescribe as necessary or appropriate in the public interest or for the protection of investors, to solicit or to permit the use of his name to solicit any proxy or consent or authorization in respect of any security . . . .

15 U.S.C. ยง 78n(a)(1). The SEC regulates such proxy solicitations as follows: No solicitation subject to this regulation shall be made by means of any proxy statement . . . containing any statement which, at the time and in the light of the circumstances under which it is made, is false or misleading with respect to any material fact, or which omits to state any ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.