2023 Rhode Island General Laws › Title 27 - Insurance › Chapter 27-35 - Insurance Holding Company Systems › Section 27-35-8. - Injunctions — Prohibitions against voting securities — Sequestration of voting securities.

§ 27-35-8. Injunctions — Prohibitions against voting securities — Sequestration of voting securities.
(a) Injunctions.
Whenever it appears to the commissioner that any insurer or any director, officer, employee, or agent thereof has committed or is about to commit a violation of this chapter or of any rule, regulation, or order issued by the commissioner under this chapter, the commissioner may apply to the superior court of Providence County for an order enjoining the insurer or director, officer, employee, or agent thereof from violating or continuing to violate this chapter or any rule, regulation, or order, and for other equitable relief as the nature of the case and the interests of the insurer’s policyholders, creditors, and shareholders or the public may require.
(b) Voting of securities; when prohibited.
No security which is the subject of any agreement or arrangement regarding acquisition, or which is acquired or to be acquired, in contravention of the provisions of this chapter or of any rule, regulation, or order issued by the commissioner under this chapter may be voted at any shareholders’ meeting, or may be counted for quorum purposes, and any action of shareholders requiring the affirmative vote of a percentage of shares may be taken as though the securities were not issued and outstanding; but no action taken at the meeting shall be invalidated by the voting of the securities, unless the action would materially affect control of the insurer or unless the courts of this state have so ordered. If an insurer or the commissioner has reason to believe that any security of the insurer has been or is about to be acquired in contravention of the provisions of this chapter or of any rule, regulation, or order issued by the commissioner under this chapter the insurer or the commissioner may apply to the superior court for Providence County to enjoin any offer, request, invitation, agreement, or acquisition made in contravention of § 27-35-2 or any rule, regulation, or order issued by the commissioner under that section to enjoin the voting of any security so acquired, to void any vote of the security already cast at any meeting of shareholders, and for such other equitable relief as the nature of the case and the interests of the insurer’s policyholders, creditors, and shareholders or the public may require.
(c) Sequestration of voting securities.
In any case where a person has acquired or is proposing to acquire any voting securities in violation of this chapter or any rule, regulation, or order issued by the commissioner under this chapter, the superior court for Providence County may, on such notice that the court deems appropriate, upon the application of the insurer or the commissioner seize or sequester any voting securities of the insurer owned directly or indirectly by the person, and issue such orders as may be appropriate to effectuate the provisions of this chapter. Notwithstanding any other provisions of law, for the purposes of this chapter, the situs of the ownership of the securities of domestic insurers shall be deemed to be in this state.
History of Section.
P.L. 1971, ch. 273, § 1; P.L. 2010, ch. 55, § 1; P.L. 2010, ch. 70, § 1; P.L. 2023, ch. 395, art. 1, § 12, effective December 31, 2023.