Newmont Mining Corporation v. T. Boone Pickens, Jr.

831 F.2d 1448 56 USLW 2304 , Fed. Sec. L. Rep. P 93,519 NEWMONT MINING CORPORATION, Plaintiff-Appellant, v. T. Boone PICKENS, Jr., et al., Defendants-Appellees. No. 87-2712. United States Court of Appeals, Ninth Circuit. Argued and Submitted Oct. 9, 1987. Decided Nov. 6, 1987. Paul Vizcarrondo, Jr., New York City, for plaintiff-appellant. Philip J. John, Houston, Tex., for defendants-appellees. Lucinda O. McConathy, Washington, D.C., as amicus curiae. Appeal from the United States District Court for the District of Nevada. Before SCHROEDER, PREGERSON, and NELSON, Circuit Judges. SCHROEDER, Circuit Judge. 1 Appellant Newmont Mining Corporation ("Newmont") appeals the district court's denial of Newmont's request for a preliminary injunction. Newmont sought to enjoin a tender offer commenced by Ivanhoe Acquisition Corporation on behalf of numerous individuals and entities including T. Boone Pickens ("the Pickens Group"). In view of the significance of the issue presented and the exigencies of time involved in takeover bids, we entered a stay pending appeal, ordered the appeal expedited, and requested amicus briefing by the Securities and Exchange Commission (SEC). We affirm the…

Appellant Newmont Mining Corporation (“Newmont”) appeals the district court’s denial of Newmont’s request for a preliminary injunction. Newmont sought to enjoin a tender offer commenced by Ivanhoe Acquisition Corporation on behalf of numerous individuals and entities including T. Boone Pickens (“the Pickens Group”). In view of the significance of the issue presented and the exigencies of time involved in takeover bids, we entered a stay pending appeal, ordered the appeal expedited, and requested amicus briefing by the Securities and Exchange Commission (SEC). We affirm the district court’s denial of injunctive relief.

The injunction action arose out of what the district court described as a “celebrated takeover battle for corporate control.” The Pickens Group commenced the tender offer for twenty-eight million shares of Newmont common stock on September 8, 1987. In accordance with SEC regulations, the Pickens Group filed a disclosure state *1449 ment with the SEC, which reflected that the Pickens Group did not yet have firm commitments for the total amount of the funds necessary to consummate the offer. Newmont’s incumbent management filed a complaint against Pickens two days…

dissenting.

I dissent. The Williams Act expressly requires that an offeror disclose, at the outset of the tender offer, its “source of funds” and if the funds are to be borrowed “a description of the transaction and the names of the parties thereto.” 15 U.S.C. § 78m(d)(l)(B) (1981). The Williams Act further authorizes the Securities and Exchange Commission to implement the Act’s *1454 provisions, 15 U.S.C. § 78n(d)(l), and the SEC has promulgated regulations setting forth the information to be contained in the tender offer statement that must be completed and filed with the SEC at the outset of an offer. 17 C.F.R. § 240 .14d-100 (1987). This statement is known as Schedule 14D-1.

To insure compliance with the statute, Schedule 14D-1 requires the disclosure of specific information for the benefit of the target company’s shareholders. For example, Item 4 of Schedule 14D-1 requires disclosure of “the source and the total amount of funds or other consideration for the purchase of the maximum number of securities for which the tender offer is being made.” For borrowed funds, Item 4 of Schedule 14D-1 further requires a summary of each loan, including “the identity of the parties, the…