Thorpe v. CERBCO, Inc.
Delaware Supreme Court
676 A.2d 436 (1996)
The Erikson brothers (defendants), directors and controlling shareholders of CERBCO, were approached in their director capacity about CERBCO selling a profitable subsidiary to another company, INA, but instead of disclosing this opportunity to CERBCO's other directors, proposed and pursued INA's separate purchase of their own personal controlling stake in CERBCO, receiving a $75,000 deposit under a letter of intent that ultimately expired without completing the sale; minority shareholder Thorpe (plaintiff) sued derivatively for usurpation of a corporate opportunity, and the Court of Chancery found a breach of the duty of loyalty but awarded no damages, reasoning the Eriksons could have blocked CERBCO's sale of the subsidiary to INA even had they disclosed the opportunity. Thorpe appealed.
Whether incidental damages stemming from a usurpation of a corporate opportunity must be awarded even when the usurping director could have prevented the corporation from actually taking advantage of the opportunity.