In contrast to many jurisdictions that have recognized special fiduciary duties owed by majority stockholders to protect minority stockholders in closely held corporations, Delaware courts have not adopted a special fiduciary duty of a controlling or majority stockholder to minority stockholders in closely held corporations, or a fiduciary duty to buy back a minority stockholder’s shares. Thus, declining to follow the approach of many other jurisdictions, Delaware law does not afford minority stockholders in a closely held corporation any greater protection than the fiduciary duties a controlling stockholder owes to a minority stockholder in a public corporation.
In enunciating the above principles for closely held corporations, the Delaware Supreme Court emphasized in the seminal case Nixon v. Blackwell, 626 A.2d 1366, 1380 (Del. 1993), that “it would do violence to normal corporate practice and our corporation law to fashion an ad hoc ruling which would result in a court-imposed stockholder buyout for which the parties had not contracted.”
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