Answer

Analysis of Marx v Akers Board Compensation Case

Brief Overview of Parties Involved in the Case: Sylvia Marx, who happened to be one of the International Business Machines Corporation’s shareholders, was the Appellant, whereas the Board of Directors including John. F Akers were the Respondent. The Appellant had commenced a derivative measure or action against the Defendant without first ordering that the board instigate the suit. 

The Court Deciding the Case: Court of Appeals of New York within in Westchester County

Major Issue or Issues in the Case Pertinent to the Week’s Lecture Topic and Reading: Whether the court erred in affirming the dismissal of the action and whether declared a factually-based charge against defendants.

How the Issue or Issues Was or Were Decided: The demand was excused as the Respondents were established to possess an interest in their own recompense or compensation.

The Appellant did not sufficiently back his claim and hence the dismissal of the suit is warranted. Apart from asserting the excessiveness of the compensation, the Appellant failed to demonstrate with distinctiveness the accounting judgments or other facts that would substantiate the excessiveness associated with the raises.

Party that Benefits Most from the Court’s Decision: The Board of Directors as they were entitled to compensation raises.

Whether I Agree with the Decision: No, I disagree with the court’s decision.  The Court focused on Delaware reasonableness approach and the universal demand, which requires demand in all occasions, but employed New York’s statutory of particularity requirements. Moreover, the Court did not provide adequate guidance as to an accurate threshold to determine the excessiveness. Appellant recognized that the compensation exceeded the living cost increase, and established that IBM was not excelling under the existing Board, but the Court considered this inadequate.