Western District Council of Lumber Production and Industrial Workers v. Louisiana Pacific Corporation, a Delaware Corporation

OVERVIEW

Western District Council of Lumber Production and Industrial Workers (Western) appeals from the magistrate’s dismissal of Western’s action for injunctive relief. Western sought to bar Louisiana Pacific (L-P) from voting proxies in the election of directors at its annual meeting. Western alleges that L-P’s acquisition of Rounds & Porter Lumber Company (Rounds & Porter) was a “related party transaction,” and L-P’s failure to disclose it rendered the proxy solicitation materially misleading in violation of Section 14(a) of the Securities Exchange Act, 15 U.S.C. § 78n(a) (1988), and Rule 14a-9. We have jurisdiction pursuant to 28 U.S.C. § 1291 , and we affirm.

FACTS

Western is the record and beneficial owner of ten shares of L-P. L-P is a public company subject to all the reporting and disclosure requirements of the Securities Exchange Act, including the rules governing proxy solicitations. Harry Merlo (Mer-lo) was President of L-P, and became Chairman of its Board of Directors. Ralph C. Rounds (Rounds) became a member of L-P’s Board in 1973 or 1974.

Until 1966, Rounds had been a co-owner of Rounds & Porter. Rounds’ brother, Dwight, was President of Rounds & Porter until…