Plaintiff debenture holder appealed the order of the Superior Court of Los Angeles County (California), which granted the motion for summary judgment filed by defendants, corporations and associated individuals, in plaintiff’s action alleging a violation of the California Corporate Securities Law of 1968, Cal. Corp. Code § 25400 et seq., and breach of contract, breach of fiduciary relationship, and breach of prospective advantage.

California Business Lawyer & Corporate Lawyer, Inc. employs the Best Corporate Attorney in California

Overview

Plaintiff debenture holder acquired convertible debentures from defendant issuing corporation. Most of defendant issuing corporation’s stock was acquired by defendant acquiring corporation. Plaintiff sought declaratory relief, alleging a violation of California Corporate Securities Law of 1968 (Act), Cal. Corp. Code § 25400 et seq., and breach of contract, fiduciary relationship, and prospective advantage. The court affirmed the order granting defendants’ motion for summary judgment, finding that the prospectus could not reasonably be interpreted to contain either a misrepresentation of present fact or a continuing implied promise to maintain a listing on the stock exchange for the life of the convertible debentures. Because there was no misstatement of a material fact, there was no violation of the pertinent sections of the Act. Plaintiff failed to show that he lost the benefits of his bargain because of any demonstrated misconduct on the part of defendants or that defendants intentionally interfered with a business relationship. The evidence showed a substantial rise in the value of his investment. There was no basis for imposing a fiduciary responsibility upon defendants.

Outcome

The trial court’s order granting the motion for summary judgment filed by defendants, corporations and associated individuals, in plaintiff’s debenture holder action for damages was affirmed. There was no misrepresentation or implied promise to maintain a listing on the stock exchange. Plaintiff failed to show that he lost the benefit of his bargain or that defendants intentionally interfered with a business relationship.