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I got 99 problems, but a bitch ain't one<br />

Hit me!<br />

[1] US v. Palmer, 360 F. 3d 1243 - Court of Appeals, 10th<br />

Circuit 2004<br />

http://www.quora.com/l/boq-ryan-lackey<br />

iron man<br />

In the movie Iron Man, could<br />

investors sue Tony Stark for<br />

acting against the interest of the<br />

shareholders?<br />

Ani Ravi, JD<br />

An investor could probably sue, but it'd be a pretty tough<br />

fight because of demand requirements and the business<br />

judgment rule.<br />

I have seen the two Iron Man movies and The Avengers,<br />

but in none of them is a 10-K for Stark Industries displayed –<br />

therefore, I'll make some assumptions about Stark Industries<br />

(that will also help to make this answer more generalizable).<br />

Let's assume that Stark Industries is a publicly-traded and<br />

US-listed company, headquartered in Delaware. Let's also assume<br />

that the Board of Directors of Stark Industries authorized<br />

or ratified Tony Stark's decision to stop manufacturing<br />

and selling weapons. Let's further assume that a shareholder<br />

vote to stop selling weapons was not required by the Stark<br />

Industries Charter or applicable law. And finally, let's assume<br />

that the stock of Stark Industries dropped 20% the day after<br />

Tony's announcement (so that our hypothetical litigious investor<br />

has a better case) [1].<br />

If this happened, an investor could certainly try to sue<br />

Tony, claiming that he breached his fiduciary duties to the<br />

shareholders by exiting the weapons business. This is an uphill<br />

battle, though. Assuming that an investor were even al-<br />

79

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