Plaintiffs lacked standing to maintain derivative action

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Karen Long and Clifford M. Thorson (“Plaintiffs”) appeal the trial court’s order granting the motion to dismiss filed by Daniel P. Hann, Niles L. Noblitt, Jerry L. Ferguson, Charles E. Niemer, Dane A. Miller, Garry L. England, Gregory D. Hartman, James W. Haller, Joel P. Pratt, Bradley J. Tandy, James R. Pastena, Kent E. Williams, C. Scott Harrison, Ray M. Harroff, Jerry L. Miller, Kenneth V. Miller, Gene L. Tanner, Marilyn Tucker Quayle, Thomas F. Kearns, Jr., Sandra A. Lamb, and Bernhard Scheuble (“Defendants”) on the derivative action filed by Plaintiffs on behalf of Biomet, Inc.  The issue at bar is whether the trial court erred in denying Defendants’ motion to dismiss because Plaintiffs do have standing to maintain their derivative action.

Conclusion (slip op. at 12):  We do not find that the trial court erred in granting the motion to dismiss based on Plaintiffs’ lack of standing. Affirmed.

Key Analysis (slip op. at 12):  Despite Plaintiffs’ repeated and heated contention that they are not challenging the asset sale or claiming that their shares of stock were worth more than the $46.00 per share that they received at the time of the sale, they undeniably seek additional compensation for those shares, and our Supreme Court has clearly held that a claim as to the value of shareholders’ shares in an asset sale is a matter to be determined in the context of the appraisal process . . . The Buyer succeeded to the rights of the former Biomet corporation to seek redress for any alleged injury suffered by the corporation as a result of options backdating by Defendants, and Plaintiffs have sold their shares in that corporation.

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Bose McKinney & Evans LLP is a business law firm, headquartered in Indianapolis, Indiana, serving both publicly held and privately held businesses, governmental entities and high-growth industries. Our clients include Fortune 100 companies, international manufacturers, national and regional financial institutions, agribusinesses, sports teams, university-incubated start-ups, media, utilities, cities and schools, to name a few. We strive to build strong relationships with our clients as key business advisors, to exceed expectations in the quality of our work, to be knowledgeable about our clients’ businesses and sectors, to be responsive to service needs and to continually seek to improve the delivery of client services. Our ultimate focus is on our clients.
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