Citigroup Inc., Charles Prince, Vikram Pandit, Gary Crittenden, Robert Rubin, Robert Druskin, Thomas G. Maheras…

Summary

The court answered a certified question by holding that the stockholders’ claims based on allegedly misleading disclosures that induced them to retain stock are direct rather than derivative, assuming the claims are otherwise cognizable. It reasoned that the claims belong personally to the holders under the potentially governing state laws and cannot plausibly belong to the corporation, so the fiduciary-duty framework for distinguishing direct and derivative claims does not apply. The court declined to decide whether either state recognizes the asserted holder claims or whether the claims ultimately succeed on the merits.