All Content

Posted by: Tanja Trezise on May 30, 2014

Court: TN Court of Appeals

Attorneys 1:

John S. Golwen, Annie T. Christoff, Johathan E. Nelson, Memphis, Tennessee, and Edward J. Fuhr (pro hac vice), Matthew P. Bosher (pro hac vice), Trevor S. Cox (pro hac vice), Richmond, Virginia, for the appellants, Phillip H. McNeill, Sr., Howard A. Silver, Raymond E. Schultz, Robert P. Bowen, and Joseph W. McLeary.

Attorneys 2:

Alan G. Crone, Memphis, Tennessee, and Lee A. Weiss (pro hac vice), Garden City, New York, for the appellees, Donald J. Roberts IRA, Dr. James M. Byers IRA Rollover, Patrick Svoboda IRA and Svoboda Realty Inc. Defined Benefit Plan, Jack Fulton, and Eric Clarke, as Trustee of Clarke Revocable Trust, On Behalf of Themselves and All Others Similarly Situated.

Judge(s): STAFFORD

This is the second interlocutory appeal from a class certification. In Roberts v. McNeill, No. W2010-01000-COA-R9-CV, 2011 WL 662648 (Tenn. Ct. App. Feb. 23, 2011) (“Roberts I”), we vacated the trial court’s class certification and remanded for reconsideration. Plaintiffs/Appellees are former owners of preferred stock in Equity Inns, Inc., who filed suit against Defendants/Appellants, the board of directors, for breaches of the fiduciary duties allegedly owed to the preferred shareholders during the negotiation and approval of a merger. Upon remand from this Court, the trial court granted the plaintiffs’ motion for class certification with respect to “the proposed preferred class stockholders.” Having previously enumerated three preferred classes of stockholders, the purported certification creates an ambiguity as to the global class. The trial court’s certification of three subclasses does not cure the ambiguity in the global class, and we cannot proceed to review under Tennessee Rule of Civil Procedure 23 in the absence of a clearly defined class. Accordingly, we vacate and remand for further consideration.