Matsushita Electric Industrial Co., LTD., et al. v. Lawrence Epstein, et al. (516 U.S. 367)
U.S. Supreme Court · decided February 27, 1996 · Supreme Court Database (Spaeth)
- Citation
- 516 U.S. 367 · 116 S. Ct. 873
- Decided
- February 27, 1996
- Term
- October Term 1995
- Vote
- 6–3
- Majority author
- Justice Thomas
- Issue area
- Judicial Power
- Disposition
- Reversed and remanded
- Outcome
- Petitioning party won
- Ideological direction
- Conservative
Opinion excerpt
Justice Thomas delivered the opinion of the Court. This case presents the question whether a federal court may withhold full faith and credit from a state-court judgment approving a class-action settlement simply because the settlement releases claims within the exclusive jurisdiction of the federal courts. The answer is no. Absent a partial repeal of the Full Faith and Credit Act, 28 U. S. C. § 1738, by another federal statute, a federal court must give the judgment the same effect that it would have in the courts of the State in which it was rendered. I In 1990, petitioner Matsushita Electric Industrial Co. made a tender offer for the common stock of MCA, Inc., a Delaware corporation. The tender offer not only resulted in Matsushita’s acquisition of MCA, but also precipitated two lawsuits on behalf of the holders of MCA’s common stock. First, a class action was filed in the Delaware Court of Chancery against MCA and its directors for breach of fiduciary duty in failing to maximize shareholder value. The complaint was later amended to state additional claims against MCA’s directors for, inter alia, waste of corporate assets by exposing MCA to liability under the federal securities laws. In addition, Matsushita was added as a defendant and was accused of conspiring with MCA’s directors to violate Delaware law. The Delaware suit was based purely on state-law claims. While the…
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