Schnell v. Chris-Craft Industries

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Facts

The directors of the corporation changed the date of the annual stockholder meeting (as specified by the by-laws), in accordance to law, to one month earlier.

Discussion

The plaintiff contends that management is trying to change the date to hold off a proxy battle to change the management of the firm. The court concludes that although changing the date is in accordance with the law, it should not be allowed because the management is trying to get a leg up in the proxy battle.

It is OK for directors to move a meeting for purposes other than to entrench themselves as directors.