Opinion ID: 3047507
Heading Depth: 3
Heading Rank: 7

Heading: District Court Ruling on Standing and June 30,

Text: 2004 Judgment On June 30, 2004, the district court returned to the standing issue it had set aside during trial. It held that Dux and Davis did not have standing to assert the Minority Shareholder 6 The jury also awarded punitive damages against An-Ehr Chen and Rextron. Those damages were vacated by the district court and are not at issue on appeal. 7 Plaintiffs’ evidence of the value of the common shares consisted of the terms of the Chen-Dux Settlement Agreement, which assigned a value of $2 per share to the common shares, “which the parties [Chen and Dux] acknowledge and agree is their good faith estimate of the current fair market value of the Shares.” Settlement Agreement ¶ 1. 2344 DUX CAPITAL MGMT v. YAGEO CORP. claim, because they did not have any legal rights to the shares prior to the bankruptcy petition that was filed on May 9, 2001. See Dux Capital Mgmt. Corp. v. Chen, Nos. C03-00539WHA, C03-00540WHA, 2004 WL 2472247, at -5 (N.D. Cal. June 30, 2004). Accordingly, the district court set aside the jury’s verdict against Rextron based on its breach of fiduciary duty to the minority shareholder. Defendants also argued in its post-trial brief on standing that plaintiffs failed to prove an assigned claim for breach of fiduciary duty to the corporation because no damages to the corporation had accrued as of the time immediately prior to the bankruptcy filing. Id. at . The district court noted that although “this issue is outside the scope of the standing issue reserved by the Court,” it would address it because “[d]efendants may have believed there was some latitude . . . due to the Court’s request for precise information on what the trial record showed was the number of common shares outstanding as of May 9, 2001.” Id. The district court held that plaintiffs had standing to sue on the assigned LLNC claim because a breach of fiduciary duty claim accrued when the directors decided to file for bankruptcy on May 3, 2001. Id. at -7. With respect to the LLNC claim, then, the district court entered judgment for plaintiffs Dux and Davis against defendants An-Ehr Chen, Yan Sheng Chan, Cheng-Ling Lee, Yageo, and Yageo Holding. The district court held that these defendants were jointly and severally liable to Dux and Davis as assignees of the corporate claim in the amount of $2,692,306 ($2 per share as found by the jury x 1,346,153 common shares). Id. at .