Opinion ID: 2308640
Heading Depth: 1
Heading Rank: 27

Heading: Upon Return from Remand For Clarification of Ruling on Duty of Disclosure

Text: On November 12, 1993, this Court, after issuing its opinion dated October 22, 1993, remanded this case to the Court of Chancery for determination of a limited issue, with jurisdiction retained only as to that issue. We requested the Court of Chancery to clarify the basis for its ruling that the Technicolor board's failure to disclose to its shareholders the self-interest of director Arthur Ryan did not constitute a breach of the defendant directors' duty of disclosure. We requested clarification of the Court of Chancery's reasoning for finding immaterial Ryan's failure to disclose his self-interest in the transaction to his fellow board members before their vote at the October 29, 1982 meeting. The Court of Chancery, by its January 7, 1994 memorandum response to this Court, establishes that the court employed the materiality analysis standard of Rosenblatt v. Getty Oil Co., Del.Supr., 493 A.2d 929, 944-45 (1985), in making its finding. We conclude that the court's disclosure ruling is the product of a logical and deductive reasoning process and sustainable as a matter of law. We therefore affirm the court's finding that the defendant directors did not breach their duty of disclosure to the Technicolor shareholders in failing to disclose Ryan's material self-interest in the transaction.