a. Was it fair for Sinclair to force Sinven to pay dividends so large that it faced
Question:
b. Was it fair for Sinclair to hire other, wholly owned subsidiaries rather than Sinven?
c. Was it fair for Sinclair not to force its other subsidiaries to abide by their contracts with Sinven?
Sinclair Oil owned 97 percent of Sinven. Sinven's minority shareholders complained that Sinclair:
• Forced Sinven to pay dividends so large that the subsidiary faced bankruptcy,
• Hired other, wholly owned subsidiaries but not Sinven, and
• Refused to force its other subsidiaries to abide by their contracts with Sinven. For instance, a Sinclair subsidiary signed a contract with Sinven to buy crude oil but failed to purchase the required amount.
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a The court did not object to the high dividend policy because the minority sh...View the full answer
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Related Book For 
Business Law and the Legal Environment
ISBN: 978-1285860381
7th edition
Authors: Susan S. Samuelson, Jeffrey F. Beatty
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