The Yosaki Trust v. Teresa S. Weber

Summary

The Supreme Court of Delaware affirmed dismissal of the Trusts’ fiduciary-duty and related claims because the Trusts lost standing after voluntarily exchanging their Holdings interests for public-company stock and then selling that stock. The court held that dilution and diversion claims travel with the relevant securities, regardless of whether the claims are characterized as direct or derivative. The court also declined to consider a new argument concerning involuntary conversion because it was not raised below and, alternatively, found it unpersuasive.