Aerogrow International, Inc. v. District Court

The Supreme Court issued a writ of mandamus directing the district court to vacate its order waiving the obligation of the real party in interest stockholders (RPIs) to provide consents from their stockholders of record until step four of the four-step process outlined in Nev. Rev. Stat. 92A.410-.440 and after petitioner corporation's merger vote was held, holding that the district court erred.

At issue was the statutory process by which a stockholder who objects to a proposed merger may seek the fair value of the stockholder's shares from the corporation if the stockholder believes the proposed price for those shares is inadequate. In the event stockholders own their shares indirectly, the beneficial stockholders must obtain the stockholder of record's consent before dissenting from the merger. The Supreme Court held (1) Nev. Rev. Stat. 92A.400(2)(a), when read in conjunction with the four-step process outlined in sections 92A.410-.440, unambiguously requires a beneficial holder to obtain the record holder's consent at step two before the vote on the merger is held; and (2) therefore, the district court here erred in construing the statutes as permitting RPIs to submit their consents after the merger vote was taken and in waiving RPIs statutory obligation to obtain those consents.