Jones v. H. F. Ahmanson Co.

Ahmanson and related corporations (defendants) controlled United Savings and Loan Association, whose stock had no real public market due to its high book value and closely held nature. To capture the era's bull market in savings-and-loan shares, the defendants created a holding company, United Financial, exchanged their own association shares for United Financial shares, and then took United Financial public, giving United Financial 85 percent ownership of the association — all without offering minority association shareholders like June Jones (plaintiff) the same opportunity to exchange their shares before the public offering. That maneuver created a thriving market for United Financial shares while ensuring the minority-held association stock could never itself become marketable. Jones sued, alleging breach of fiduciary duty by the controlling shareholders.