Court Opinion

ID: 9442310
Source: CourtListenerOpinion
Date Created: 2023-08-03 18:43:42.727417+00
Date Added: 2024-06-11T17:29:03.612348
License: Public Domain

CLARK, Circuit Judge
(concurring in the result).
The attack on the plan’s treatment of these warrants developed only at the very end of the proceedings before the Commission, and apparently then appeared as a small issue amid a series of other important ones. Because of this it does not appear in the record that the Commission considered the market quotations, now deemed so important; and I am willing to have the cause go back to the Commission to make new and more detailed findings as to the value of these warrants. But I do wish to emphasize that we cannot now properly make any decision that the warrants do have more than a purely nominal value; and if the opinion can be taken as so intimating, I must express disagreement. The opinion cites and relies only on these market quotations and does not mention the strong case the Commission builds to show that, except for a gambler’s chance in the market, the warrants will never produce results from the holders. This is based on past, present, and prospec.-tive earnings, and the small possibilities of increased income in this state-regulated utility to a point where the vast gap between present values and those, necessary to make the warrants usable will be made up; it represents in general the values soundly to be put upon the various security interests in any but a speculative market.
Thus the old shares would have to treble from the value of $14.78, which the court now puts on them in the light of market quotations, to something above the $42.86 exercise price before the warrants would have any value so far as actual use is concerned. Perhaps no one can say beyond peradventure that the price of the shares may not increase to that remarkable extent or that New York may not let the business thus prosper. But a function of the Commission is to gaze into the future; and it is within its province to evaluate as best it can the possibility of such prosperity. De minimis non curat lex is still a salutary principle; and if, as the Commission now argues persuasively, the possibility of these warrants ever having any exercise value is so remote as to be unreal, then payment to the warrant holders is not only not necessary, but positively unlawful.
The court is properly concerned with protecting the warrant holders from the destruction of any valuable right they may have. If these warrants do have any real value and they are awarded a lesser sum or adjudged completely worthless, a confiscation will be worked which the Commission, in common with our court, would abhor. But we must not overlook the fact that the reverse is also true, and that to pay these warrant holders any more than the real value of their warrants is to take assets unjustly from the owners of the common stock. Care must be taken lest the emphasis on rights be all one way. Valuation of future contingencies is not an exact science, and the Commission can only make its best expert guess. While I *619agree that it must consider the market quotations for the warrants, it will then be for it to decide how far, if at all, this rebuts the strong arguments heretofore presented that the warrants are without any substantial value.