Walker v. Campbell et al
Filing
47
MEMORANDUM AND ORDER granting 29 Motion to Dismiss the Complaint. So Ordered by Judge Paul J. Barbadoro (USDC-NH, sitting by designation) on 9/13/2011. (Duhamel, John)
UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF RHODE ISLAND
In Re Textron, Inc.,
Shareholder Derivative Litigation
Case No. 09-cv-556-PB
MEMORANDUM AND ORDER
John D. Walker filed this shareholder derivative action on
behalf of Textron,
Inc. against two of the company's officers
and 11 of its 13 directors.
The defendants have responded with
a motion arguing that the complaint must be dismissed because
Walker filed the action without first demanding that the company
bring the suit itself.
The issue that the case presents is
whether Walker has sufficiently alleged that a pre-suit demand
would have been futile.
I .
BACKGROUND
Textron is a conglomerate that manufactures and sells
helicopters, airplanes, light transportation vehicles, and lawn
care machinery.
It is also a major supplier to the automotive
industry, and it has a large commercial finance business.
Walker bases his claims on a stock purchase plan that the
company's board of directors approved on July 19, 2007, and a
series of allegedly misleading statements that Textron's CEO,
Lewis B. Campbell, and CFO, Ted J. French, made concerning the
company's "backlog" of aircraft and helicopter orders.
A.
The Stock Repurchase Plan
On July 19, 2007, Textron's board approved a stock
repurchase plan that authorized the company to repurchase up to
24 million shares of its own stock.
Doc. No.1.
Complaint ("Compl.")
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