Janet is a shareholder in the Multi-Millions Corporation and she is very worried. Every time she...

Janet is a shareholder in the Multi-Millions Corporation and she is very worried. Every time she checks the value of her shares of stock the price keeps going lower and lower. Janet suspects that the reason for the drastic decrease in value of the shares of stock is the result of mismanagement by the directors of the corporation. She calls you for advice. In a case such as this, what kind of lawsuit may be brought against the directors of the corporation? What must be proven to be successful? Who would be the plaintiff in such a lawsuit? And, if the lawsuit is successful, who will benefit? Explain your answer in detail addressing each question.

Expert Solution

Stock price can see alot of short term votality. If stock holding is long term portfolio it can be important or revisit change yur investmen thesis with new announcement. Demand factor effect the share price .

Economic Factor: If interest rate change finanial outook change and inflation effect all the prices.

Industry trend: Industry trends often determine the trend because companies in the same industry perform similarly and are subject to same pressure.

First of all janet should file a complaint and give adequate time to resolve if you are not satisfied with response you can file a suit agaist owner of the company.

Plaintiff is a person who files a suit. Here janet is a plaintiff .

Following factor should keep in mind to make it successful:

1) He has right to vote on important matter of the corporation. She can vote in favour or against any resolution which effect the share price

There are many laws in us to protet the interest of shareholder. under securities exchange board help to protect the right of shareholdr.

If law suit successful obviously shareholder will get benefit either it wil get adquate amount of its share which are invested in company

jeff jeffy answered 1 year ago

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