S-24-0791 Streck, Inc. and Larry Gies, et al. (Appellees/Cross-Appellees) v. Carol Ryan, individually, et al. (Appellees and Cross-Appellant) v. Ryan Foundation (Appellants/Cross-Appellees)
Appeal from the District Court for Sarpy County, Judge Nathan B. Cox
Attorneys: David A. Domina (DominaLaw Group pc llo for Appellants/Cross-Appellees), Victoria H. Buter (Kutak Rock, LLP for Appellees/Cross-Appellees), and John A. Svoboda, Ryan M. Kunhart, and Claire E. Monroe (Dvorak Law Group, LLC for Appellees/Cross-Appellants).
Civil: Corporate shareholder right of appraisal under Neb. Rev. Stat. § 21-2,171
Proceedings below: Pursuant to Neb. Rev. Stat. § 21-2,171, the district court determined that in the disposition of assets, a shareholder is entitled to appraisal rights only if that shareholder is entitled to vote on the disposition. Appellees/Cross-Appellants petitioned to bypass the Court of Appeals, which the Supreme Court granted and ordered that this case be transferred to its docket.
Issues: Appellants/Cross-Appellees assign the following errors: 1) The district court erred when it granted partial summary judgment for Appellees, including declaratory judgment, denied partial summary judgment for Appellants, and determined that Streck, Inc. Class B shareholders did not have appraisal rights under Neb Rev Stat §§ 21-2,171 et seq.; 2) The district court erred when it failed to recognize that the challenged Transaction is an “interested transaction”, i.e. one involving an “interested person” as Neb Rev Stat §2 1-2,171(4)-(6) defines these terms, and all shareholders have appraisal rights as a result; 3) The district court erred when it failed to recognize that Streck’s corporate articles confer appraisal rights on Appellants Class B shares; 4) The district court erred when it failed to recognize that the Appellees added an artificial form-over-substance step to a Transaction in progress to attempt to defeat both voting and appraisal rights of Class B shareholders; 5) The district court erred when it failed to recognize Neb Rev Stat §§ 21-1916 and 30-3215 mandate that Class B shareholders have appraisal rights where a charitable foundation holds nonvoting shares; and 6) The district court erred when it determined that the sole party liable for fair value of Streck shares under § 21-2,171 et seq. is Streck, Inc., the dissolved company.
On cross-appeal, Appellees/Cross-Appellants assign the following errors: 1) The trial court erred when it ruled against the Ryan Defendants on their Motion for Partial Summary Judgment and failed to determine that the Second Proposed Transaction was an “Interested Transaction” conferring appraisal rights on all shareholders; 2) The trial court erred when it failed to find that Streck, Inc.’s Articles of Incorporation conferred appraisal rights on all shareholders; 3) The trial court erred when it found, as a matter of law, that the Class B shareholders did not have the right to vote on the Second Proposed Transaction; 4) The trial court erred when it failed to recognize Streck, Inc.’s form over substance conversion from a merger to a disposition of assets in the second proposed transaction was an attempt to strip voting and appraisal rights from Class B shareholders; 5) The trial court erred when it found that the Ryan Defendants did not have appraisal rights to determine the fair value of their shares pursuant to Neb. Rev. Stat. § 21-2,171 et seq.; and 6) The trial court erred when it dismissed Constance, Gies, and Streck LLC (collectively, the “Third-Party Defendants”), and found that Streck, Inc. was the sole party liable for payment of fair value of Streck, Inc. shares.