Marathon Partners L.P. And Furtherfield Partners L.P. v. M&F Worldwide Corporation

2004 WL 1728604 (Del.Ch. July 30, 2004)

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Nature of the Case

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Facts

D is a publicly traded Delaware corporation subject to the reporting requirements of the federal securities laws and manufactures a substantial amount of the licorice flavoring sold worldwide to end-users. Ronald O. Perelman is a director of D and owns a large amount of D's stock through Mafco. D authorized Mafco to purchase 750,000 additional D shares on the open market. If Mafco purchased all of the authorized shares, its ownership percentage would increase from 36.2% to 41.3% of the outstanding shares. If Perelman exercised an existing option on an additional 500,000 shares, his beneficial ownership would increase to about 42.8%. Ps sent a letter demanding access to inspect and copy four categories of books and records and D's stock ledger. D sought any internal valuations, any documents regarding offers, proposals, solicitations, or presentations regarding the sale of D, or any of its assets, to a third party, any documents sent to, received from, or reflecting conversations with any third party regarding the sale of D, its shares, or its assets, and any documents regarding any updates, revisions, or modifications to D's internal financial estimates over the next five years. D denied P's demand for inspection. P also sent a letter demanding access to D's lists of stockholders of record, including any magnetic computer tape lists. The letter also sought and books and records. Ps identified a potential derivative suit for an alleged failure to restrict certain purchases of D stock by Mafco. D denied P's demand for inspection. Ps filed an action to compel D to permit the demanded inspection. Trial was held on January 22, 2004.