What is the main change in Emerson Electric's Bylaws announced in this 8-K?

The main change is the adoption of a 'forum selection' provision. This means that for most legal disputes involving the company, its officers, directors, or shareholders, lawsuits must be filed in specific courts located in Missouri (primarily the U.S. District Court for the Eastern District of Missouri or local Missouri state courts), rather than in any court where a lawsuit could theoretically be brought.

Why would Emerson Electric implement a forum selection clause?

Companies typically implement forum selection clauses to standardize where legal disputes are handled. This can help reduce litigation costs, prevent forum shopping by plaintiffs seeking more favorable jurisdictions, and ensure that complex corporate law issues are litigated in a consistent and predictable legal environment, potentially leading to more efficient resolution.

Who is affected by this change?

This change affects current and former directors, officers, employees, agents, and shareholders of Emerson Electric Co. It dictates where they must bring certain types of legal actions against the company or related to their roles within the company.

What types of legal actions are covered by this new provision?

The provision covers a wide array of actions, including derivative lawsuits brought on behalf of the company, claims of breach of fiduciary duty by directors or officers, actions related to the Missouri General and Business Corporation Law, and disputes governed by the internal affairs doctrine of the corporation.

EMR 8-K: Corporate Changes

Summary

Emerson Electric Co. (EMR) filed an 8-K on August 3, 2016, to report an amendment to its Bylaws, effective August 2, 2016. The primary change introduces a 'forum selection' provision, designating specific courts in Missouri (U.S. District Court for the Eastern District of Missouri or state courts in St. Louis County) as the exclusive venue for a wide range of legal actions involving the company, its directors, officers, employees, agents, and shareholders. This amendment aims to streamline litigation and ensure that certain types of lawsuits are heard in a consistent and predictable jurisdiction.

Key Highlights

1Emerson Electric Co. amended its corporate Bylaws on August 2, 2016.
2The amendment establishes a 'forum selection' clause.
3The designated forum for specified legal actions is primarily the U.S. District Court for the Eastern District of Missouri.
4Alternatively, certain actions may be brought in Missouri state courts (Circuit Court of St. Louis County or other Missouri courts).
5This provision applies to a broad range of claims, including derivative actions and breaches of fiduciary duties.
6The purpose is to provide a consistent and exclusive venue for litigation concerning the company's internal affairs and governance.
7The full amended Bylaws and the specific amended provisions are filed as exhibits to the 8-K.

EMERSON ELECTRIC CO 8-K Report, Bylaw Amendment (Aug 4, 2016)

Summary

Key Highlights

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