CTS Corporation v. Dynamics Corporation of America
United States Supreme Court
481 U.S. 69 (1987)
Indiana's control-share statute required disinterested shareholders to vote within 50 days on whether an acquirer crossing certain ownership thresholds would receive voting rights, and Dynamics (plaintiff), poised to cross the 20 percent threshold in CTS (defendant) through a tender offer, argued the statute's 50-day window conflicted with the Williams Act's requirement that tender offers remain open at least 20 business days, and separately violated the Commerce Clause; the lower courts agreed with Dynamics.
Whether a state statute requiring a majority vote of all disinterested shareholders in a corporation to give voting rights to an entity that acquires "control shares" in the corporation interferes with a federal statute designed to protect the interests of minority shareholders.