{ "id": 4343081, "name": "IRVING EHRENHAUS, On Behalf of Himself and All Others Similarly Situated, Plaintiff-appellee v. JOHN D. BAKER, II, PETER C. BROWNING, JOHN T. CASTEEN, III, JERRY GITT, WILLIAM H. GOODWIN, JR., MARYELLEN C. HERRINGER, ROBERT A. INGRAM, DONALD M. JAMES, MACKEY J. McDONALD, JOSEPH NEUBAUER, TIMOTHY D. PROCTOR, ERNEST S. RADY, VAN I. RICHEY, RUTH G. SHAW, LANTY L. SMITH, DONA DAVIS YOUNG, WACHOVIA CORPORATION and WELLS FARGO & COMPANY, Defendants-appellees v. NORWOOD ROBINSON and JOHN H. LOUGHRIDGE, JR., Objectors-appellants", "name_abbreviation": "Ehrenhaus v. Baker", "decision_date": "2011-10-04", "docket_number": "No. COA10-1034", "first_page": "59", "last_page": "99", "citations": [ { "type": "official", "cite": "216 N.C. App. 59" } ], "court": { "name_abbreviation": "N.C. Ct. App.", "id": 14983, "name": "North Carolina Court of Appeals" }, "jurisdiction": { "id": 5, "name_long": "North Carolina", "name": "N.C." }, "cites_to": [ { "cite": "614 S.E.2d 596", "category": "reporters:state_regional", "reporter": "S.E.2d", "case_ids": [ 12633185 ], "year": 2005, "pin_cites": [ { "page": "597", "parenthetical": "stating settlements are interpreted according to \"general principles of contract law" } ], "opinion_index": 0, "case_paths": [ "/se2d/614/0596-01" ] }, { "cite": "631 S.E.2d 1", "category": "reporters:state_regional", "reporter": "S.E.2d", "case_ids": [ 12636087 ], "weight": 2, "year": 2006, "pin_cites": [ { "page": "13", "parenthetical": "quoting Russell M. Robinson, II, Robinson on North Carolina Corporation Law \u00a7 14.06, at 14-16 to -17 (2005)" }, { "page": "13" } ], "opinion_index": 0, "case_paths": [ "/se2d/631/0001-01" ] }, { "cite": "610 S.E.2d 210", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 2005, "pin_cites": [ { "page": "214-15", "parenthetical": "\"[P]laintiff fails to cite any legal authority in support of his position. Accordingly, we conclude that this issue does not warrant appellate review, and Aye dismiss this assignment of error.\"" } ], "opinion_index": 0 }, { "cite": "169 N.C. App. 151", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8468804 ], "year": 2005, "pin_cites": [ { "page": "159", "parenthetical": "\"[P]laintiff fails to cite any legal authority in support of his position. Accordingly, we conclude that this issue does not warrant appellate review, and Aye dismiss this assignment of error.\"" } ], "opinion_index": 0, "case_paths": [ "/nc-app/169/0151-01" ] }, { "cite": "607 S.E.2d 48", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 2, "year": 2005, "pin_cites": [ { "page": "51" } ], "opinion_index": 0 }, { "cite": "168 N.C. App. 135", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8468462 ], "weight": 2, "year": 2005, "pin_cites": [ { "page": "140" } ], "opinion_index": 0, "case_paths": [ "/nc-app/168/0135-01" ] }, { "cite": "2003 NCBC 10", "category": "reporters:specialty", "reporter": "NCBC", "weight": 2, "year": 2004, "pin_cites": [ { "page": "\u00b674", "parenthetical": "unpublished" } ], "opinion_index": 0 }, { "cite": "344 S.E.2d 97", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 2, "year": 1986, "pin_cites": [ { "page": "100", "parenthetical": "stating that courts cannot rewrite the plain language' of a contract" } ], "opinion_index": 0 }, { "cite": "81 N.C. App. 116", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8521623 ], "year": 1986, "pin_cites": [ { "page": "120", "parenthetical": "stating that courts cannot rewrite the plain language' of a contract" } ], "opinion_index": 0, "case_paths": [ "/nc-app/81/0116-01" ] }, { "cite": "171 N.C. App. 423", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8437548 ], "year": 2005, "pin_cites": [ { "page": "425", "parenthetical": "stating settlements are interpreted according to \"general principles of contract law" } ], "opinion_index": 0, "case_paths": [ "/nc-app/171/0423-01" ] }, { "cite": "693 A.2d 1076", "category": "reporters:state_regional", "reporter": "A.2d", "case_ids": [ 12004669 ], "year": 1997, "pin_cites": [ { "page": "1079" } ], "opinion_index": 0, "case_paths": [ "/a2d/693/1076-01" ] }, { "cite": "858 A.2d 927", "category": "reporters:state_regional", "reporter": "A.2d", "case_ids": [ 9161755 ], "year": 2004, "pin_cites": [ { "page": "929", "parenthetical": "quoting United Vanguard Fund v. Takecare, Inc., 693 A.2d 1076, 1079 (Del. 1997)" } ], "opinion_index": 0, "case_paths": [ "/a2d/858/0927-01" ] }, { "cite": "72 S.E.2d 21", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1952, "pin_cites": [ { "page": "22" } ], "opinion_index": 0 }, { "cite": "236 N.C. 96", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8622485 ], "year": 1952, "pin_cites": [ { "page": "97-98" } ], "opinion_index": 0, "case_paths": [ "/nc/236/0096-01" ] }, { "cite": "266 S.E.2d 812", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1980, "pin_cites": [ { "page": "814-15", "parenthetical": "citations omitted" } ], "opinion_index": 0 }, { "cite": "300 N.C. 286", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8561053 ], "year": 1980, "pin_cites": [ { "page": "289", "parenthetical": "citations omitted" } ], "opinion_index": 0, "case_paths": [ "/nc/300/0286-01" ] }, { "cite": "127 F. Supp. 2d 418", "category": "reporters:federal", "reporter": "F. Supp. 2d", "case_ids": [ 11075976 ], "weight": 2, "year": 2001, "pin_cites": [ { "page": "425" }, { "page": "430" } ], "opinion_index": 0, "case_paths": [ "/f-supp-2d/127/0418-01" ] }, { "cite": "668 F. Supp. 450", "category": "reporters:federal", "reporter": "F. Supp.", "case_ids": [ 3937127 ], "year": 1987, "pin_cites": [ { "page": "451" } ], "opinion_index": 0, "case_paths": [ "/f-supp/668/0450-01" ] }, { "cite": "910 A.2d 1020", "category": "reporters:state_regional", "reporter": "A.2d", "case_ids": [ 8450439 ], "year": 2006, "pin_cites": [ { "page": "1039", "parenthetical": "Delaware claim requires the fiduciary to breach his fiduciary duty and the non-fiduciary to participate knowingly in that breach" } ], "opinion_index": 0, "case_paths": [ "/a2d/910/1020-01" ] }, { "cite": "511 U.S. 164", "category": "reporters:federal", "reporter": "U.S.", "case_ids": [ 1146992 ], "weight": 2, "year": 1994, "opinion_index": 0, "case_paths": [ "/us/511/0164-01" ] }, { "cite": "364 S.E.2d 444", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 2, "year": 1988, "pin_cites": [ { "page": "447" }, { "page": "447", "parenthetical": "aiding and abetting theory required \"a securities law violation\"" } ], "opinion_index": 0 }, { "cite": "88 N.C. App. 484", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8358498 ], "weight": 2, "year": 1988, "pin_cites": [ { "page": "490" }, { "page": "489" } ], "opinion_index": 0, "case_paths": [ "/nc-app/88/0484-01" ] }, { "cite": "610 F. Supp. 2d 528", "category": "reporters:federal", "reporter": "F. Supp. 2d", "case_ids": [ 4213074 ], "weight": 2, "year": 2009, "pin_cites": [ { "page": "532", "parenthetical": "concluding North Carolina does not recognize such a claim" }, { "page": "532" } ], "opinion_index": 0, "case_paths": [ "/f-supp-2d/610/0528-01" ] }, { "cite": "2009 WL 2581615", "category": "reporters:specialty_west", "reporter": "WL", "year": 2009, "pin_cites": [ { "parenthetical": "unpublished" } ], "opinion_index": 0 }, { "cite": "435 B.R. 46", "category": "reporters:specialty", "reporter": "B.R.", "case_ids": [ 3771473 ], "year": 2010, "pin_cites": [ { "page": "66", "parenthetical": "\"It is not even clear that North Carolina recognizes a cause of action for aiding and abetting breach of fiduciary duty.\"" } ], "opinion_index": 0, "case_paths": [ "/br/435/0046-01" ] }, { "cite": "426 U.S. 438", "category": "reporters:federal", "reporter": "U.S.", "case_ids": [ 6178202 ], "weight": 2, "year": 1976, "pin_cites": [ { "page": "449" }, { "page": "766" } ], "opinion_index": 0, "case_paths": [ "/us/426/0438-01" ] }, { "cite": "493 A.2d 929", "category": "reporters:state_regional", "reporter": "A.2d", "case_ids": [ 7918372 ], "year": 1985, "pin_cites": [ { "page": "944", "parenthetical": "alteration in original" } ], "opinion_index": 0, "case_paths": [ "/a2d/493/0929-01" ] }, { "cite": "396 U.S. 375", "category": "reporters:federal", "reporter": "U.S.", "case_ids": [ 11334767 ], "weight": 3, "opinion_index": 0, "case_paths": [ "/us/396/0375-01" ] }, { "cite": "606 A.2d 75", "category": "reporters:state_regional", "reporter": "A.2d", "case_ids": [ 11301404 ], "year": 1992, "pin_cites": [ { "page": "84" } ], "opinion_index": 0, "case_paths": [ "/a2d/606/0075-01" ] }, { "cite": "818 A.2d 914", "category": "reporters:state_regional", "reporter": "A.2d", "case_ids": [ 9356800 ], "weight": 7, "year": 2003, "pin_cites": [ { "page": "938" }, { "page": "917" }, { "page": "918" }, { "page": "939" }, { "page": "934" } ], "opinion_index": 0, "case_paths": [ "/a2d/818/0914-01" ] }, { "cite": "N.C. Gen. Stat. \u00a7\u00a7 55-11-01", "category": "laws:leg_statute", "reporter": "N.C. Gen. Stat.", "weight": 9, "pin_cites": [ { "page": "*2" }, { "page": "*7" }, { "page": "*21" }, { "page": "*23" }, { "page": "*23-24" }, { "page": "*24" } ], "opinion_index": 0 }, { "cite": "N.C. Gen. Stat. \u00a7 55-11-02", "category": "laws:leg_statute", "reporter": "N.C. Gen. Stat.", "opinion_index": 0 }, { "cite": "N.C. Gen. Stat. \u00a7 55", "category": "laws:leg_statute", "reporter": "N.C. Gen. Stat.", "weight": 2, "opinion_index": 0 }, { "cite": "N.C. Gen. Stat. \u00a7 55-10-04", "category": "laws:leg_statute", "reporter": "N.C. Gen. Stat.", "weight": 2, "year": 2009, "opinion_index": 0 }, { "cite": "N.C. Gen. Stat. \u00a7 55-6-01", "category": "laws:leg_statute", "reporter": "N.C. Gen. Stat.", "year": 2009, "pin_cites": [ { "page": "(a)" } ], "opinion_index": 0 }, { "cite": "N.C. Gen. Stat. \u00a7 55-10-02", "category": "laws:leg_statute", "reporter": "N.C. Gen. Stat.", "year": 2009, "opinion_index": 0 }, { "cite": "507 F.2d 759", "category": "reporters:federal", "reporter": "F.2d", "case_ids": [ 129975 ], "year": 1974, "pin_cites": [ { "page": "763", "parenthetical": "concluding statutory violation could form the basis for breach of fiduciary duty claim" } ], "opinion_index": 0, "case_paths": [ "/f2d/507/0759-01" ] }, { "cite": "N.C. Gen. Stat. \u00a7 55-10-03", "category": "laws:leg_statute", "reporter": "N.C. Gen. Stat.", "weight": 2, "year": 2009, "pin_cites": [ { "page": "(b)" }, { "page": "(b)" } ], "opinion_index": 0 }, { "cite": "178 N.C. App. 1", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8376072 ], "weight": 2, "year": 2006, "pin_cites": [ { "page": "20-21", "parenthetical": "quoting Russell M. Robinson, II, Robinson on North Carolina Corporation Law \u00a7 14.06, at 14-16 to -17 (2005)" }, { "page": "20-21" } ], "opinion_index": 0, "case_paths": [ "/nc-app/178/0001-01" ] }, { "cite": "N.C. Gen. Stat. \u00a7 55-8-30", "category": "laws:leg_statute", "reporter": "N.C. Gen. Stat.", "weight": 5, "year": 2009, "pin_cites": [ { "page": "(a)" }, { "page": "(b)" }, { "page": "(d)" }, { "page": "(b)(2)" }, { "page": "(c)" } ], "opinion_index": 0 }, { "cite": "160 S.E. 896", "category": "reporters:state_regional", "reporter": "S.E.", "year": 1931, "pin_cites": [ { "page": "906", "parenthetical": "some citations omitted" } ], "opinion_index": 0 }, { "cite": "201 N.C. 577", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8626992 ], "year": 1931, "pin_cites": [ { "page": "598", "parenthetical": "some citations omitted" } ], "opinion_index": 0, "case_paths": [ "/nc/201/0577-01" ] }, { "cite": "548 S.E.2d 704", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 2001, "pin_cites": [ { "page": "707-08", "parenthetical": "quoting Abbitt v. Gregory, 201 N.C. 577, 598, 160 S.E. 896, 906 (1931) (some citations omitted). The General Statutes prescribe a standard of conduct for corporate directors: a director must discharge his duties \"(1) [i]n good faith; (2" } ], "opinion_index": 0 }, { "cite": "353 N.C. 647", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 135724 ], "year": 2001, "pin_cites": [ { "page": "651", "parenthetical": "quoting Abbitt v. Gregory, 201 N.C. 577, 598, 160 S.E. 896, 906 (1931) (some citations omitted). The General Statutes prescribe a standard of conduct for corporate directors: a director must discharge his duties \"(1) [i]n good faith; (2" } ], "opinion_index": 0, "case_paths": [ "/nc/353/0647-01" ] }, { "cite": "335 S.E.2d 30", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1985, "pin_cites": [ { "page": "31" } ], "opinion_index": 0 }, { "cite": "77 N.C. App. 411", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8522936 ], "year": 1985, "pin_cites": [ { "page": "413-14" } ], "opinion_index": 0, "case_paths": [ "/nc-app/77/0411-01" ] }, { "cite": "234 U.S. 385", "category": "reporters:federal", "reporter": "U.S.", "case_ids": [ 675104 ], "weight": 2, "year": 1914, "pin_cites": [ { "page": "394" }, { "page": "1369" } ], "opinion_index": 0, "case_paths": [ "/us/234/0385-01" ] }, { "cite": "180 L. Ed. 2d 374", "category": "reporters:federal", "reporter": "L. Ed. 2d", "case_ids": [ 5930529, 12450492 ], "weight": 9, "year": 2011, "pin_cites": [ { "page": "397-98", "parenthetical": "\"Similarly, (b)(2) does not require . . . opt-out rights, presumably because it is thought (rightly or wrongly) that notice has no purpose when the class is mandatory, and that depriving people of their right to sue in this manner complies with the Due Process Clause.\"" }, { "page": "398" } ], "opinion_index": 0, "case_paths": [ "/us/564/0338-01", "/l-ed-2d/180/0374-01" ] }, { "cite": "309 F.3d 789", "category": "reporters:federal", "reporter": "F.3d", "case_ids": [ 3700048, 11408850 ], "year": 2002, "pin_cites": [ { "page": "792" } ], "opinion_index": 0, "case_paths": [ "/us-app-dc/353/0398-01", "/f3d/309/0789-01" ] }, { "cite": "64 F.3d 1171", "category": "reporters:federal", "reporter": "F.3d", "case_ids": [ 7415473 ], "weight": 2, "year": 1995, "pin_cites": [ { "page": "1175" }, { "page": "1175" } ], "opinion_index": 0, "case_paths": [ "/f3d/64/1171-01" ] }, { "cite": "216 F.3d 577", "category": "reporters:federal", "reporter": "F.3d", "case_ids": [ 11212682 ], "year": 2000, "pin_cites": [ { "page": "581" } ], "opinion_index": 0, "case_paths": [ "/f3d/216/0577-01" ] }, { "cite": "151 F.3d 402", "category": "reporters:federal", "reporter": "F.3d", "case_ids": [ 11710720 ], "weight": 4, "year": 1998, "pin_cites": [ { "page": "412" }, { "page": "412" }, { "page": "413" }, { "page": "413" } ], "opinion_index": 0, "case_paths": [ "/f3d/151/0402-01" ] }, { "cite": "472 U.S. 797", "category": "reporters:federal", "reporter": "U.S.", "case_ids": [ 1512277 ], "weight": 4, "year": 1985, "opinion_index": 0, "case_paths": [ "/us/472/0797-01" ] }, { "cite": "1999 WL 33545517", "category": "reporters:specialty_west", "reporter": "WL", "opinion_index": 0 }, { "cite": "741 F.2d 1332", "category": "reporters:federal", "reporter": "F.2d", "case_ids": [ 618526 ], "year": 1984, "pin_cites": [ { "page": "1337", "parenthetical": "\"Differences in the amount of damages between the class representative and other class members does not affect typicality.\"" } ], "opinion_index": 0, "case_paths": [ "/f2d/741/1332-01" ] }, { "cite": "134 F.3d 873", "category": "reporters:federal", "reporter": "F.3d", "case_ids": [ 11587974 ], "year": 1998, "opinion_index": 0, "case_paths": [ "/f3d/134/0873-01" ] }, { "cite": "616 F.2d 305", "category": "reporters:federal", "reporter": "F.2d", "case_ids": [ 1392016 ], "year": 1980, "pin_cites": [ { "page": "314" } ], "opinion_index": 0, "case_paths": [ "/f2d/616/0305-01" ] }, { "cite": "721 F. Supp. 80", "category": "reporters:federal", "reporter": "F. Supp.", "case_ids": [ 11335450 ], "weight": 2, "year": 1989, "pin_cites": [ { "page": "83", "parenthetical": "\"[T]he reaction of the class to the settlement is perhaps the most significant factor to be weighed in considering its adequacy.\"" } ], "opinion_index": 0, "case_paths": [ "/f-supp/721/0080-01" ] }, { "cite": "390 U.S. 414", "category": "reporters:federal", "reporter": "U.S.", "case_ids": [ 6171777 ], "weight": 2, "year": 1968, "pin_cites": [ { "page": "424-25", "parenthetical": "\"Basic to this process in every instance, of course, is the need to compare the terms of the compromise with the likely rewards of litigation. It is here that we must start in the present case.\"" }, { "page": "10", "parenthetical": "\"Basic to this process in every instance, of course, is the need to compare the terms of the compromise with the likely rewards of litigation. It is here that we must start in the present case.\"" } ], "opinion_index": 0, "case_paths": [ "/us/390/0414-01" ] }, { "cite": "440 F.2d 1079", "category": "reporters:federal", "reporter": "F.2d", "case_ids": [ 760372 ], "year": 1971, "pin_cites": [ { "page": "1085" } ], "opinion_index": 0, "case_paths": [ "/f2d/440/1079-01" ] }, { "cite": "443 F. Supp. 2d 1249", "category": "reporters:federal", "reporter": "F. Supp. 2d", "case_ids": [ 3665961 ], "year": 2006, "pin_cites": [ { "page": "1255", "parenthetical": "citation omitted" } ], "opinion_index": 0, "case_paths": [ "/f-supp-2d/443/1249-01" ] }, { "cite": "150 F.3d 1011", "category": "reporters:federal", "reporter": "F.3d", "case_ids": [ 1540664 ], "year": 1998, "pin_cites": [ { "page": "1026", "parenthetical": "\"[T]he decision to approve or reject a settlement is committed to the sound discretion of the trial judge because he is exposed to the litigants, and their strategies, positions and proof.\" (quotation marks omitted) (citation omitted" } ], "opinion_index": 0, "case_paths": [ "/f3d/150/1011-01" ] }, { "cite": "706 F.2d 1144", "category": "reporters:federal", "reporter": "F.2d", "case_ids": [ 1116885 ], "year": 1983, "pin_cites": [ { "page": "1147" } ], "opinion_index": 0, "case_paths": [ "/f2d/706/1144-01" ] }, { "cite": "855 F. Supp. 825", "category": "reporters:federal", "reporter": "F. Supp.", "case_ids": [ 3889179 ], "weight": 2, "year": 1994, "pin_cites": [ { "page": "827" }, { "page": "827" } ], "opinion_index": 0, "case_paths": [ "/f-supp/855/0825-01" ] }, { "cite": "818 F.2d 145", "category": "reporters:federal", "reporter": "F.2d", "case_ids": [ 1716288 ], "year": 1987, "opinion_index": 0, "case_paths": [ "/f2d/818/0145-01" ] }, { "cite": "597 F. Supp. 740", "category": "reporters:federal", "reporter": "F. Supp.", "case_ids": [ 3709174 ], "year": 1984, "pin_cites": [ { "page": "758", "parenthetical": "citations omitted" } ], "opinion_index": 0, "case_paths": [ "/f-supp/597/0740-01" ] }, { "cite": "211 F.R.D. 457", "category": "reporters:specialty", "reporter": "F.R.D.", "case_ids": [ 1031167 ], "year": 2002, "pin_cites": [ { "page": "466", "parenthetical": "\"There is an overriding public interest in favor of settlement, particularly in class actions that have the well-deserved reputation as being most complex.\"" } ], "opinion_index": 0, "case_paths": [ "/frd/211/0457-01" ] }, { "cite": "506 S.E.2d 728", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1998, "pin_cites": [ { "page": "731", "parenthetical": "\"The real consideration is not found in the partiesf] sacrifice of rights, but in the bare fact that they have settled the dispute.\"" } ], "opinion_index": 0 }, { "cite": "131 N.C. App. 257", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 11198742 ], "year": 1998, "pin_cites": [ { "page": "262", "parenthetical": "\"The real consideration is not found in the partiesf] sacrifice of rights, but in the bare fact that they have settled the dispute.\"" } ], "opinion_index": 0, "case_paths": [ "/nc-app/131/0257-01" ] }, { "cite": "540 S.E.2d 324", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 4, "year": 2000, "pin_cites": [ { "page": "331" }, { "parenthetical": "citations omitted" }, { "page": "330" }, { "page": "330", "parenthetical": "stating our decisions should be informed by federal decisions where appropriate" } ], "opinion_index": 0 }, { "cite": "353 N.C. 188", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 135780 ], "weight": 3, "year": 2000, "pin_cites": [ { "page": "199" }, { "page": "197" }, { "page": "196" } ], "opinion_index": 0, "case_paths": [ "/nc/353/0188-01" ] }, { "cite": "552 S.E.2d 655", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 2001, "pin_cites": [ { "page": "660", "parenthetical": "citations omitted" } ], "opinion_index": 0 }, { "cite": "146 N.C. App. 33", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 11353675 ], "year": 2001, "pin_cites": [ { "page": "41", "parenthetical": "citations omitted" } ], "opinion_index": 0, "case_paths": [ "/nc-app/146/0033-01" ] }, { "cite": "354 S.E.2d 459", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 3, "year": 1987, "pin_cites": [ { "page": "463-64" }, { "page": "465-66" }, { "page": "466" } ], "opinion_index": 0 }, { "cite": "319 N.C. 274", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 4748509 ], "weight": 3, "year": 1987, "pin_cites": [ { "page": "277-80" }, { "page": "282-84" }, { "page": "283" } ], "opinion_index": 0, "case_paths": [ "/nc/319/0274-01" ] }, { "cite": "677 S.E.2d 1", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 2, "year": 2009, "pin_cites": [ { "page": "4" }, { "page": "4" } ], "opinion_index": 0 }, { "cite": "197 N.C. App. 296", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 4167587 ], "weight": 2, "year": 2009, "pin_cites": [ { "page": "300" }, { "page": "300" } ], "opinion_index": 0, "case_paths": [ "/nc-app/197/0296-01" ] } ], "analysis": { "cardinality": 2759, "char_count": 100568, "ocr_confidence": 0.756, "pagerank": { "raw": 9.216055683374621e-08, "percentile": 0.5100698921056788 }, "sha256": "9da5e7897021132fc9ff9b5c74c463f26787bc2b761b4354a7d78384aecb324e", "simhash": "1:abef57aa7f488c70", "word_count": 15860 }, "last_updated": "2023-07-14T18:13:27.459138+00:00", "provenance": { "date_added": "2019-08-29", "source": "Harvard", "batch": "2018" }, "casebody": { "judges": [ "Judges CALABRIA and STROUD concur." ], "parties": [ "IRVING EHRENHAUS, On Behalf of Himself and All Others Similarly Situated, Plaintiff-appellee v. JOHN D. BAKER, II, PETER C. BROWNING, JOHN T. CASTEEN, III, JERRY GITT, WILLIAM H. GOODWIN, JR., MARYELLEN C. HERRINGER, ROBERT A. INGRAM, DONALD M. JAMES, MACKEY J. McDONALD, JOSEPH NEUBAUER, TIMOTHY D. PROCTOR, ERNEST S. RADY, VAN I. RICHEY, RUTH G. SHAW, LANTY L. SMITH, DONA DAVIS YOUNG, WACHOVIA CORPORATION and WELLS FARGO & COMPANY, Defendants-appellees v. NORWOOD ROBINSON and JOHN H. LOUGHRIDGE, JR., Objectors-appellants" ], "opinions": [ { "text": "HUNTER, JR., Robert N., Judge.\nI. Introduction\nAs of 30 September 2008, Wachovia Corporation (\u201cWachovia\u201d) was the nation\u2019s fourth largest banking institution. Founded in 1908, Wachovia\u2019s stock was widely held throughout this state. Many regarded Wachovia as a conservative, sound financial institution that had survived previous financial crises such as the Great Depression. When the 2008 financial collapse began, Wachovia\u2019s loan portfolio was encumbered with a large number of mortgages that it had obtained through its 2007 acquisition of Golden West Financial Corporation (\u201cGolden West\u201d), the nation\u2019s second largest dedicated mortgage bank. These mortgage liabilities caused Wachovia\u2019s depositors and investors to lose confidence in that institution and a \u201crun\u201d on the bank developed, causing the Federal Deposit Insurance Corporation (\u201cFDIC\u201d) to inform Wachovia\u2019s corporate officers and the Wachovia board of directors (the \u201cWachovia Board\u201d or the \u201cBoard\u201d) that Wachovia needed to merge with a solvent financial institution or be placed into receivership. After negotiation with other financial institutions, the Board agreed to a merger proposal (the \u201cProposed Merger\u201d or the \u201cMerger\u201d) from Wells Fargo & Company (\u201cWells Fargo\u201d).\nShortly after the Proposed Merger was announced, Irving Ehrenhaus filed this class action, on behalf of a class consisting of all shareholders of Wachovia common stock (the \u201cClass\u201d), challenging the Merger and seeking injunctive relief. After the trial court granted in part and denied in part Ehrenhaus\u2019s motion for a preliminary injunction, the parties entered into a settlement (the \u201cProposed Settlement\u201d or the \u201cSettlement\u201d), which resolved or released the Class\u2019s claims \u2014 both pending claims and any claims that could be asserted pertaining to the Merger. The trial court heard from several individuals and groups that objected to the Settlement, but ultimately approved the Settlement after a fairness hearing. The final Settlement did not release claims pending in other courts.\nThis appeal concerns the events which led to the precipitous decline of Wachovia, its subsequent Merger with Wells Fargo, the dissatisfaction with that Merger, the ensuing litigation and Settlement, and the dissatisfaction with that Settlement. Norwood Robinson and John H. Loughridge (\u201cObjectors-appellants\u201d) are dissatisfied with the court-approved Settlement and raise five central arguments asking this court to reverse the Merger. First, they argue the trial court erred in denying Ehrenhaus\u2019s motion for a preliminary injunction, and in doing so, the trial court denied Wachovia shareholders\u2019 their statutory voting rights. Objectors-appellants\u2019 second argument is that the trial court failed to examine properly the qualifications and adequacy of the Class representative (Ehrenhaus) and his counsel. Third, Objectors-appellants contend the trial court approved an unreasonable, inadequate Settlement. Objectors-appellants\u2019 fourth argument is that Wachovia shareholders were wrongfully denied the right to opt out of the Class and pursue their own causes of action. Finally, Objectors-appellants argue the trial court erred in omitting certain evidence from the record and failing to consider that evidence in approving the Settlement. After careful review, we affirm in part and reverse in part.\nII. Factual & Procedural Background\nThe causes of the financial collapse were not at issue before the trial court. However, the events leading to the Wachovia-Wells Fargo Merger, and the rapidity with which they occurred, provide the context for the Board\u2019s decision to approve the Merger and the parties\u2019 decision to approve the Settlement. The following narrative is primarily derived from the factual findings contained in the trial court\u2019s orders. These findings are binding because they are either unchallenged or supported by competent evidence. Blitz v. Agean, Inc., 197 N.C. App. 296, 300, 677 S.E.2d 1, 4 (2009).\nA. The Financial Crisis, Merger Negotiations, and Merger Approval\nBeginning in the spring of 2008, a series of financial failures began to erode confidence in our nation\u2019s financial institutions. The following events culminated in a rapid decline in the public confidence in banks that held large positions in government-backed mortgage securities. On 7 September 2008 the United States government seized control of two mortgage giants: the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac). On 15 September 2008, Lehman Brothers Holding, Inc. collapsed and filed for bankruptcy. The same day, Merrill Lynch & Co. avoided filing for bankruptcy by agreeing to be acquired by Bank of America. On 16 September 2008, the United States government agreed to a multi-billion dollar rescue plan for American International Group, Inc. (\u201cAIG\u201d).\nThe Wachovia Board met by telephone on 16 September 2008. Management informed the Board that the bank was experiencing liquidity problems due to financial market conditions. The Board expressed a preference for the bank to remain an independent entity and directed management to pursue that goal. Realizing Wachovia might not be able to stand on its own, the Board also directed management to explore a potential merger. On 20 September 2008, U.S. government officials expressed concern to Wachovia\u2019s management concerning the bank\u2019s liquidity, encouraging management to enter discussion with an unidentified potential merger partner. Those negotiations proved fruitless.\nOn 25 September 2008, the FDIC seized the banking assets of Washington Mutual, Inc. That same day, the United States House of Representatives rejected the initial \u201cbailout\u201d plan proposed by the United States Department of the Treasury for the nation\u2019s financial system. These two events exacerbated Wachovia\u2019s liquidity crisis. Wachovia\u2019s share price descended to $1.84 \u2014 down over 90 percent from the closing price ten days earlier. The Wachovia Board met again by telephone conference the following day, when management informed it that, if Wachovia did not arrange a merger by 29 September, the FDIC would place Wachovia\u2019s bank subsidiaries into receivership.\nWachovia engaged in parallel negotiations with Citigroup, Inc. and Wells Fargo over the terms of a potential merger during the weekend of 27 September 2008. However, both suitors were unwilling to move forward without government assistance in the form of a loss-sharing arrangement. On 28 September, the FDIC notified Wachovia that the bank posed a \u201csystemic risk\u201d to the banking system and that the FDIC intended to exercise its authority to force a sale of Wachovia to another financial institution. The FDIC rejected a Wachovia counterproposal that would have given the FDIC an equity stake in Wachovia and allowed the firm to remain independent.\nWachovia subsequently entered into a non-binding agreement in principle by which Citigroup would acquire Wachovia\u2019s bank subsidiaries with assistance from the FDIC. Citigroup would have paid Wachovia $2.16 billion in cash and/or stock and assumed $53.2 billion of Wachovia\u2019s debt. The merger would have left Wachovia as a standalone entity, but with its principal businesses limited to its retail brokerage and mutual fund operations. Disagreements between the two financial institutions remained, however, and Citigroup insisted the two firms finalize the deal by 3 October 2008. Shortly before 9:00 p.m. on 2 October 2008, Wells Fargo forwarded a merger agreement, approved by its board, to Wachovia representatives.\nThis merger agreement required Wachovia and Wells Fargo to conduct a separate share exchange, pursuant to which Wells Fargo would acquire ten newly issued shares of Wachovia Series M, Class A Preferred Stock, representing 39.9 percent of Wachovia\u2019s aggregate voting rights, including the right to vote on the approval of the proposed merger, in exchange for 1000 shares of Wells Fargo common stock. These shares were subject to a \u201ctail provision,\u201d providing they could not be redeemed by Wachovia for eighteen months following the shareholder vote on the merger agreement \u2014 even if the merger was not consummated. Unlike the proposed Citigroup merger, the proposed Wells Fargo merger did not contain a \u201cmaterial adverse change clause.\u201d The exchange ratio provided that Wachovia\u2019s public shareholders would receive 0.1991 shares of Wells Fargo common stock in exchange for each share of Wachovia common stock they owned. The proposal also contained a \u201cfiduciary out\u201d provision that required Wachovia\u2019s Board to submit the merger to a vote even if the Board no longer recommended the merger.\nThe Wachovia Board convened at 11:00 p.m. to consider the Wells Fargo merger proposal. Perella Weinberg and Goldman Sachs, financial services firms hired to advise the Board, counseled the Board that the offer was fair under the circumstances and counseled against attempting to negotiate with Wells Fargo for more favorable terms in light of the time constraints imposed upon Wachovia by the FDIC. (The following day was the deadline to agree to the proposed Citigroup merger.) These advisors stated the exchange ratio was fair. In light of Wachovia\u2019s increasingly perilous liquidity problem, the FDIC\u2019s refusal to provide Wachovia with government assistance, and other considerations, the Board was left with no reasonable alternative and unanimously voted to approve the Merger. Shortly thereafter, Wachovia notified Citigroup that Wachovia intended to merge with Wells Fargo. The next day, the public announcement of the Merger agreement alleviated Wachovia\u2019s liquidity crisis; its share price closed at $6.21 \u2014 up from the previous day\u2019s close of $3.91.\nOn 8 October 2008, Ehrenhaus filed this class action on behalf of the public shareholders of Wachovia common stock against Wachovia, Wells Fargo, and members of the Wachovia Board. See infra Section II.B. Wachovia and Wells Fargo pressed on to consummate the Merger.\nThe Board of Governors of the Federal Reserve System (the \u201cFed Board\u201d) quickly approved the Merger agreement on 12 October 2008. In doing so, the Fed Board noted, \u201c[T]he unusual and exigent circumstances affecting the financial markets [and] the weakened financial condition of Wachovia. . . justified expeditious action on [the Merger Agreement].\u201d (Second and third alterations in original.)\nPursuant to a 1990 amendment to the Wachovia articles of incorporation, the Wachovia Board issued ten shares of Series M, Class A Preferred Stock pursuant to the share exchange agreement. Wachovia and Wells Fargo completed the share exchange on 20 October 2008. The Wachovia Board scheduled a special shareholders\u2019 meeting for 23 December 2008 for the purpose of voting on the Merger agreement.\nB. The Action and Preliminary Injunction Proceedings\nEhrenhaus\u2019s complaint challenged the Merger on the following grounds: (1) the share exchange, which provided Wells Fargo with 39.9 percent of the voting power for the Merger, invalidly disenfranchised Wachovia shareholders; (2) the tail provision was coercive with respect to the shareholder vote because it impeded the Board from seeking out other bidders for at least eighteen months after a shareholder vote rejecting the Merger; (3) the Merger provided Wachovia shareholders with insufficient consideration in exchange for their shares; and (4) the fiduciary out clause was inadequate because the Board would have been required to submit the Merger to a vote in the event of a superior proposal, rather than withdraw entirely from the Merger agreement. The complaint sought to enjoin the Merger or rescind it if consummated. The complaint also sought a judgment directing Defendants-appellees to pay the Class \u201call damages caused to them and account for all profits and any special benefits obtained as a result of their wrongful conduct.\u201d\nOn 15 October 2008, Ehrenhaus moved for a preliminary injunction, seeking to invalidate the tail provision, the fiduciary out provision contained in the Merger agreement, and the issuance of the preferred stock to Wells Fargo. The trial court held a hearing on 24 November 2008. Wachovia shareholders did not personally receive notice of the hearing. At this time, however, the legal proceedings had attracted attention from the news media and public. The trial court received over 200 letters and emails from public officials, Wachovia shareholders, and others on the subject, most expressing dissatisfaction with the Proposed Merger. For example, the Charlotte Observer published an editorial entitled, \u201cLet Shareholders Have Their Say on Wells Deal.\u201d No other shareholder sought to intervene under Rule 24 and offered to serve as class representative at any time prior to the fairness hearing.\nThe trial court granted in part and denied in part Ehrenhaus\u2019s preliminary injunction motion. Wachovia and Wells Fargo were successful in protecting the core components of the Merger. The trial court concluded the Board\u2019s approval of the Merger agreement was an informed decision, made in good faith, with an honest belief that the action was in the best interests of Wachovia and its shareholders. The trial court denied preliminary injunctive relief as to the issuance of the preferred stock and concluded the preferred stock did not disenfranchise Wachovia\u2019s shareholders because \u201cWells Fargo ha[d] not \u2018locked up\u2019 an absolute majority of the votes required for approval of the Merger Agreement.\u201d The existence of the preferred stock was not coercive or preclusive of another bidder, according to the trial court because, other than Citigroup, there was no other offer to consider, and it was unlikely that another suitor would emerge. Therefore, the trial court concluded the Board\u2019s decision to approve the merger agreement was reasonable under the circumstances. The trial court granted partial preliminary injunctive relief, voiding the tail provision because the court concluded the provision would impede the Board in fulfilling its fiduciary duty to seek out merger partners in the event a potential suitor\u2019s overtures had been rejected.\nC. The Amended Complaint, Negotiations, Terms of the Proposed Settlement, Merger Approval, Preliminary Class Certification, and Preliminary Settlement Approval\nFollowing the issuance of the partial injunction, Ehrenhaus amended his complaint to allege Wachovia\u2019s proxy statement contained material false and misleading statements and omitted material information related to the Merger. The parties began settlement negotiations shortly thereafter, and on 17 December 2008, they entered into a memorandum of understanding (\u201cMOU\u201d) setting forth an agreement-in-principle to settle the case. The settlement reflected in the MOU required Wachovia to make additional disclosures regarding the Merger (the \u201cAdditional Disclosures\u201d). Pursuant to this requirement, Wachovia filed a Form 8-K with the Securities and Exchange Commission, put out a press release, and published a post on its website. These materials disclosed matters related to previous omissions Ehrenhaus alleged in his complaint.\nWells Fargo agreed to absorb the cost of providing notice to the Class of the proposed settlement and to pay up to $1,975 million in attorney\u2019s fees to Class counsel. The final amount was to be awarded by the court. The Proposed Settlement would release and discharge all causes of action against Defendants-appellees arising from the allegations contained in Ehrenhaus\u2019s complaint as well as any claims not asserted in the complaint that Class members could have brought related to the Merger. These claims expressly did not include (1) enforcement of the Proposed Settlement or (2) \u201cthe claims asserted by [the] plaintiffs in the \u2018Amended Class Action Complaint for Violations of the Federal Securities Laws\u2019 \u201d filed in the Lipetz v. Wachovia Corp., No. 08 Civ. 6171 (RJS) (S.D.N.Y.), litigation. The Proposed Settlement agreement also provided that Class counsel would conduct confirmatory discovery to ensure the fairness of the Settlement.\nOn 23 December 2008, the Merger was approved by 76 percent of the votes entitled to be cast of Wachovia\u2019s outstanding common and preferred stock. The firms consummated the Merger on 31 December 2008. During the time period between 31 December 2008 and 24 April 2009, Class counsel reviewed documents and took depositions to examine the conduct of corporate officials with regard to the Merger. Upon completing this due diligence, the parties entered into a stipulation of settlement.\nOn 24 April 2009, the trial court granted preliminary approval of the Proposed Settlement based on the parties\u2019 stipulation. This preliminary approval order conditionally certified the case as a non-opt-out class action, Ehrenhaus as Class representative, the law firm of Wolf Popper LLP as Ehrenhaus\u2019s lead counsel, and Greg Jones & Associates, P.A. as North Carolina Liaison Counsel. Pursuant to this order, Wells Fargo distributed over one million copies of a notice of the pending class action settlement to Class members.\nD. Objections to the Proposed Settlement and Resolution\nAt a settlement fairness hearing held on 20 August 2009, the trial court heard from several parties who objected to the Proposed Settlement, including Objectors-appellants Norwood Robinson and John H. Loug'hridge, Jr. Following the hearing, the Orange County Employees\u2019 Retirement System and a group led by John M. Rivers withdrew their objections after agreeing to a modification of the release of claims stipulation. These include claims not arising out of either the Merger or the negotiation of terms and disclosures related to the Merger. These also include claims arising from Wachovia\u2019s business or Defendants-appellees\u2019 acts or omissions before or after the Class period. Mr. Robinson and Mr. Loughridge filed an objection to the Revised Stipulation, attaching a complaint they and others filed asserting claims against Wachovia and the Wachovia Board related to Wachovia\u2019s 2006 acquisition of mortgage lender Golden West. All other objectors withdrew their objection to the Proposed Settlement.\nOn 5 February 2010, the trial court entered its final order certifying the Class and approving the Proposed Settlement. The court awarded $932,621.98 in attorney\u2019s fees to Class counsel.\nIII. Analysis\nObjectors-appellants make four general arguments on appeal: (1) the trial court should have enjoined the Merger; (2) the trial court erred in certifying the Class; (3) the trial court erred in approving the Settlement; and (4) the trial court failed to consider critical evidence.\nNorth Carolina Rule of Civil Procedure 23 provides, \u201cIf persons constituting a class are so numerous as to make it impracticable to bring them all before the court, such of them, one or more, as will fairly insure the adequate representation of all may, on behalf of all, sue or be sued.\u201d N.C.R. Civ. P. 23(a). This rule is based on the federal counterpart to Rule 23 as it existed prior to 1966, when North Carolina adopted a modified version of the Federal Rules of Civil Procedure for state proceedings. See generally Crow v. Citicorp Acceptance Co., 319 N.C. 274, 277-80, 354 S.E.2d 459, 463-64 (1987). While the language of North Carolina Rule 23 has remained constant, Federal Rule 23 has been amended, and the case law interpreting the rule is extensive. \u201c[Wjhile federal class action cases are not binding on [North Carolina courts,] we have held in the past that the reasoning in such cases can be instructive. This is so even though North Carolina\u2019s [Rule 23]... is quite different from the present federal Rule 23.\u201d Scarvey v. First Fed. Sav. & Loan Ass\u2019n., 146 N.C. App. 33, 41, 552 S.E.2d 655, 660 (2001) (citations omitted).\nThe requirements of establishing a class action have been established by our Supreme Court in Crow.\nThe party seeking to bring a class action under Rule 23(a) has the burden of showing that the prerequisites to utilizing the class action procedure are present. First, parties seeking to employ the class action procedure under our Rule 23 must establish the existence of a class. As we have indicated, the plaintiffs properly alleged the existence of a class. On remand, however, the plaintiffs also will be required to demonstrate the actual existence of the class.\nThe named representatives also must establish that they will fairly and adequately represent the interests of all members of the class. This prerequisite is a requirement of due process.\nThe named representatives must show that there is no conflict of interest between them and the members of the class who are not named parties, so that the interests of the unnamed class members will be adequately and fairly protected. The named parties also must have a genuine personal interest, not a mere technical interest, in the outcome of the action.\nThe class representatives within this jurisdiction also must establish that they will adequately represent those outside the jurisdiction. The class the plaintiffs in the present case seek to represent is defined as including only \u201ccurrent residents of North Carolina.\u201d Therefore, by definition, there are no class members outside the jurisdiction.\nParties seeking to utilize Rule 23 also must establish that the class members are so numerous that it is impractical to bring them all before the court. It is not necessary that they demonstrate the impossibility of joining class members, but they must demonstrate substantial difficulty or. inconvenience in joining all members of the class. There can be no firm rule for determining when a class is so numerous that joinder of all members is impractical. The number is not dependent upon any arbitrary limit, but rather upon the circumstances of each case.\nAdditionally, although Rule 23(a) says nothing about the need for notice to members of the class represented, we believe that fundamental fairness and due process dictate that adequate notice of the class action be given to them. The actual manner and form of the notice is largely within the discretion of the trial court. The trial court may require, among other things, that it review the content of any notice before its dissemination.\nThe trial court should require that the best notice practical under the circumstances be given to class members. Such notice should include individual notice to all members who can be identified through reasonable efforts, but it need not comply with the formalities of service of process. Notice of the action should be given as soon as possible after the action is commenced. As part of the notification, the trial court may require that potential class members be given an opportunity to request exclusion from the class within a specified time in a manner similar to the current federal practice.\n319 N.C. at 282-84, 354 S.E.2d at 465-66.\nIn reviewing the decisions of a trial court involving class certifications, our Supreme Court has instructed us to apply the abuse of discretion standard. Frost v. Mazda Motor of Am., Inc., 353 N.C. 188, 199, 540 S.E.2d 324, 331 (2000). A trial court abuses its discretion when its \u201cdecision is manifestly unsupported by reason or so arbitrary that it could not have been the result of a reasoned decision.\u201d Id. (citations omitted) (internal quotation marks omitted).\nRule 23(c) provides, \u201cA class action shall not be dismissed or compromised without the approval of the judge.\u201d Because settlements are \u201ccompromises,\u201d a class action must therefore be subject to judicial review before it can be effectuated. While our business courts have reviewed class action settlements with regularity under a \u201cfairness, reasonable and adequacy\u201d standard based upon persuasive authority developed by federal courts and cases from other jurisdictions, no North Carolina appellate court has specifically reviewed this standard. For example, Judge Diaz in his February 2008 opinion viewed the standards as follows:\nSettlement has long been favored over litigation, and public policy favors upholding good faith settlements, even without strong regard to the consideration underlying the settlement.\nIn light of the law and policy favoring settlement, federal courts reviewing a settlement agreement in class action cases conduct first a preliminary approval hearing to determine whether there is probable cause to notify class members of the proposed settlement, then a fairness hearing to determine if the proposed settlement is \u201cfair, reasonable, and adequate.\u201d The burden is on the proponents of the settlement to demonstrate the proposed settlement is fair, reasonable, and adequate.\nThe weight given to each factor in evaluating the fairness, reasonableness, and adequacy of a proposed class action settlement varies depending on the circumstances of a given case. Generally, a trial court should ensure that the proposed settlement is \u201cnot the product of collusion between the parties,\u201d and should evaluate its terms relative to the strength of the plaintiffs case.\nIn addition to the strength of the plaintiffs case, some factors commonly evaluated include: (a) the defendant\u2019s ability to pay; (b) the complexity and cost of further litigation; (c) the amount of opposition to the settlement; (d) class members\u2019 reaction to the proposed settlement; (e) counsel\u2019s opinion; and (f) the stage of the proceedings and how much discovery has been completed. (Citations omitted.)\nOur judicial system has a strong preference for settlement over litigation. Courts are generally indifferent to the nature of the parties\u2019 agreement; why or how the case is settled is of little concern. See, e.g., Knight Publ\u2019g Co., Inc. v. Chase Manhattan Bank, N.A., 131 N.C. App. 257, 262, 506 S.E.2d 728, 731 (1998) (\u201cThe real consideration is not found in the partiesf] sacrifice of rights, but in the bare fact that they have settled the dispute.\u201d). This preference for settlement applies to class actions. See Ass\u2019n For Disabled Americans v. Amoco Oil Co., 211 F.R.D. 457, 466 (S.D. Fla. 2002) (\u201cThere is an overriding public interest in favor of settlement, particularly in class actions that have the well-deserved reputation as being most complex.\u201d). But due to unique due process concerns implicated by binding a group of individuals not before the court, we are concerned with the circumstances and terms of class action settlements. Thus,parties cannot settle a class action without court approval. N.C.R. Civ. P 23(c). The purpose of the settlement approval requirement is to\n(1) assure[] that any person whose rights would be affected by settlement has the opportunity to support or oppose it; (2) prevent[] private arrangements that may constitute \u201csweetheart deals\u201d contrary to the best interests of the class; (3) protect[] the rights of those whose interests may not have been given due regard by the negotiating parties; and finally, (4) assure [] each member of the class that his or her integrity and right to express views and be heard on matters of vital personal interest has not been violated by others who have arrogated to themselves the power to speak and bind without consultation and consent.\nIn re Agent Orange Prod. Liab. Litig., 597 F. Supp. 740, 758 (E.D.N.Y. 1984) (citations omitted), aff\u2019d sub nom., In re Agent Orange Prod. Liab. Litig. MDL No. 381, 818 F.2d 145 (2d Cir. 1987).\nA trial court evaluating a class action settlement should follow the two-step procedure generally employed by federal courts. First, the trial court should conduct \u201ca preliminary approval or pre-notification hearing to determine whether the proposed settlement is \u2018within the range of possible approval\u2019 or, in other words, whether there is \u2018probable cause\u2019 to notify the class of the proposed settlement.\u201d Horton v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 855 F. Supp. 825, 827 (E.D.N.C. 1994). If the trial court grants preliminary approval, \u201cnotice is sent to the class, [and] the court conducts a \u2018fairness\u2019 hearing, at which all interested parties are afforded an opportunity to be heard on the proposed settlement.\u201d Id.) cf. Frost, 353 N.C. at 197, 540 S.E.2d at 330 (\u201c[N.C.] Rule 23 does not by its terms require notice to class members, but adequate notice is dictated by \u2018fundamental fairness and due process.\u2019 \u201d (quoting Crow, 319 N.C. at 283, 354 S.E.2d at 466)). At this second hearing, the trial court must ascertain whether the proposed settlement is \u201cfair, reasonable, and adequate.\u201d Horton, 855 F. Supp. at 827. Proponents of class action settlements bear the burden of showing the settlement meets this standard. Holmes v. Cont\u2019l Can Co., 706 F.2d 1144, 1147 (11th Cir. 1983). Appellate courts review the decision to approve a settlement for abuse of discretion. 7B Charles Alan Wright et al., Federal Practice & Procedure \u00a7 1797.1, at 80 (3d ed. 2005); see also Hanlon v. Chrysler Corp., 150 F.3d 1011, 1026 (9th Cir. 1998) (\u201c[T]he decision to approve or reject a settlement is committed to the sound discretion of the trial judge because he is exposed to the litigants, and their strategies, positions and proof.\u201d (quotation marks omitted) (citation omitted).\nWhen reviewing a class action settlement, the trial court must protect, to the extent practicable, the rights of passive class members. It should also be sensitive to the possibility of collusion by the parties actively involved in the case. Wright et al., supra, \u00a7 1797.1, at 79. \u201c[I]t is generally accepted that where settlement precedes class certification (e.g., approval for settlement and certification are sought simultaneously, as is the case here) district courts must be \u2018even more scrupulous than usual\u2019 when examining the fairness of the proposed settlement.\u201d In re Sprint Corp. ERISA Litig., 443 F. Supp. 2d 1249, 1255 (D. Kan. 2006) (citation omitted). Courts consider a variety of factors in evaluating a settlement, giving heavy weight to two in particular. The first is the likelihood the class will prevail should litigation go forward and the potential spoils of victory, balanced against benefits to the class offered in the settlement. State of W. Va. v. Chas. Pfizer & Co., 440 F.2d 1079, 1085 (2d Cir. 1971); see also Protective Comm. for Indep. Stockholders of TMT Trailer Ferry, Inc. v. Anderson, 390 U.S. 414, 424-25, 20 L. Ed. 2d 1, 10 (1968) (\u201cBasic to this process in every instance, of course, is the need to compare the terms of the compromise with the likely rewards of litigation. It is here that we must start in the present case.\u201d). The second is the class\u2019s reaction to the settlement. Sala v. Nat\u2019l R.R. Passenger Corp., 721 F. Supp. 80, 83 (E.D. Pa. 1989) (\u201c[T]he reaction of the class to the settlement is perhaps the most significant factor to be weighed in considering its adequacy.\u201d).\nProfessor Wright emphasizes, among other things,\nthe points of law on which the settlement is based[;] ... if the action went forward, the plan for allocating the settlement among the class members or for distributing the settlement to the class[;] whether proper procedures were adopted for giving notice to the absent class members[;] and whether a settlement would waive other viable claims.\nWright et al., supra, \u00a7 1797.1, at 82-94 (footnotes omitted); see also 4 Abba Conte & Herbert Newberg, Newberg on Class Action \u00a7 13:68, at 479-81 (4th ed. 2002). The opinion of counsel is also a relevant factor. Armstrong v. Bd. of Sch. Dir. of City of Milwaukee, 616 F.2d 305, 314 (7th Cir. 1980), overruled on other grounds by Felzen v. Andreas, 134 F.3d 873 (7th Cir. 1998).\nBecause the trial court\u2019s final order both certified the class and approved a final settlement, Objectors-appellants contest portions of each determination. Of the multiple Crow requirements to certify a class, Objectors-appellants contest only two requirements: the adequacy of class representative, see infra Section III.B.l; and the adequacy of class counsel, see infra Section III.B.2. Objectors-appellants also raise a due process argument concerning the trial court\u2019s decision to certify the Class as a non-opt-out class, see infra Section III.B.3. Objectors-appellants also contend the trial court approved a settlement that was not fair, adequate and reasonable. See infra Section III.C.\nOur analysis proceeds as follows. Objectors-appellants\u2019 first contention is that the trial court erred in denying Ehrenhaus\u2019s motion for a preliminary injunction. Appellees respond that Objectors-appellants lack standing to appeal the denial of the injunction. While we decline to answer that question, see infra Section III.A, the substantive issues raised by Objectors-appellants\u2019 preliminary injunction argument are resolved in other portions of our analysis.\nWe next turn to Objectors-appellants\u2019 argument that Ehrenhaus, as Class representative, and his attorneys, as Class counsel, are not qualified to serve the Class. See infra Sections III.B.1-2, respectively. We then address the third class certification issue: whether the trial court erred in certifying a non-opt-out class. See infra Section III.B.3.\nObjectors-appellants next take issue with the trial court\u2019s decision to approve the Settlement. Our review examines (1) the probability the Class would have prevailed had this matter been litigated in full and the potential benefits to the Class, see Section III.C.l; (2) the merits of a claim that was not the thrust of Ehrenhaus\u2019s litigation strategy: a claim for damages against the Wachovia Board, see Section III.C.2; and (3) the reaction of the Class, recommendations of counsel, and notice adequacy, see Section III.C.3.\nWe then turn to the trial court\u2019s award of attorney\u2019s fees. See infra Section III.C.4. Finally, we address Objectors-appellants\u2019 allegations that the trial court omitted evidence from the record and refused to consider material evidence. See infra Section III.D.\nA. The Denial of the Motion for a Preliminary Injunction\nObjectors-appellants argue the trial court erred in denying Ehrenhaus\u2019s motion for a preliminary injunction to enjoin the issuance of Series M shares to Wells Fargo. Specifically, they argue Wachovia\u2019s articles of incorporation did not authorize the issuance of the shares.\nBefore attempting to settle the case, Ehrenhaus sought to enjoin the issuance of these shares to Wells Fargo. After failing to convince the trial court to issue the preliminary injunction, Ehrenhaus opted to settle. Objectors-appellants became involved in this case only when Appellees sought court approval of the settlement. Prior to that time, they did not seek to intervene or to represent the Class themselves. Thus, Objectors-appellants not only appeal the class certification and settlement approval \u2014 which were entered after objectors-appellants intervened in this case through the objection process \u2014 but also seek appellate review of an order entered before they participated in this case.\nAppellees contend Objectors-appellants have no right to appeal the denial in part of the injunction. Objectors-appellants have not directed us to any binding authority establishing that a party may appeal under these circumstances. Nor has our research discovered any. Neither party has briefed the practical strengths or weaknesses of a procedural rule that would permit an objector to appeal under these circumstances. For this reason, and because we address the substance of Objectors-appellant\u2019s argument below, see infra Section III.B (reviewing the fairness of the Settlement), we decline to expound on whether Objectors-appellants have a right to appeal the denial of a preliminary injunction under these circumstances.\nB. Class Certification\nThe trial court\u2019s decision to certify the class was appropriately based on the Crow requirements. We now consider (I) whether the Class representative was adequate; (2) whether Class counsel was adequate; and (3) whether Class members should have been permitted to opt-out.\n1. Class representative\nObjectors-appellants argue Ehrenhaus was an inadequate Class representative and that the trial court selected him as the Class representative because the court failed to conduct an adequate inquiry of his qualifications. We disagree.\nThe trial court concluded Ehrenhaus\nfairly and adequately represents the interests of the Class because [Ehrenhaus] is a Class member with the same legal claims as the other Class members, he has a genuine personal interest in the outcome of the litigation, and he has no conflict of interest with other Class members because he will not receive compensation for serving as Class Representative.\nEhrenhaus owned 1080 shares of Wachovia stock before Wells Fargo acquired the stock and will not be compensated for serving as Class representative. Objectors-appellants fail to direct us to any fact indicating Ehrenhaus\u2019s interest in the litigation would be different from the remainder of the Class. Their brief implies that his ownership of 1080 shares is problematic because there were over two billion outstanding shares of Wachovia stock. But owning a (relatively) small number of shares is not a bar to a class member serving as class representative. Cf. Kornberg v. Carnival Cruise Lines, Inc., 741 F.2d 1332, 1337 (11th Cir. 1984) (\u201cDifferences in the amount of damages between the class representative and other class members does not affect typicality.\u201d).\nObjectors-appellants maintain \u201c[t]here was no one to represent the Wachovia Shareholders after the MOU was executed.\u201d Essentially, Objectors-appellants object to the trial court conducting a final certification hearing after the parties entered into the MOU and contend that, once the MOU was consummated, the parties were colluding to the shareholders\u2019 detriment. Objectors-appellants cite no authority for the proposition that a trial court may not conduct a final certification hearing after the parties have agreed in principle to a settlement, and we see no reason why the trial court\u2019s approach was inappropriate, particularly in light of the time constraints imposed by financial crisis. In contending the Class received no representation following the date of the MOU, Objectors-appellants completely fail to mention the extensive post-MOU discovery conducted by Class counsel in order to confirm the Proposed Settlement was fair and adequate.\nAfter the parties agreed on the MOU, Class counsel conducted four depositions and reviewed nearly 10,000 pages of documents. The Settlement was contingent on Ehrenhaus determining whether the discovery confirmed the Settlement was fair; Ehrenhaus could walk away from the Proposed Settlement, in his sole discretion, if the confirmatory discovery indicated the Settlement was unfair. Ehrenhaus retained a financial advisor to provide an opinion concerning deficiencies in the proxy statement as well. Objectors-appellants have not referred us to anything in the record indicating Ehrenhaus or Class counsel were covertly engaged in conduct contrary to the Class\u2019s best interests. Finally, we note that no other shareholder came forward at this time to intervene seeking to serve as Class representative.\n2. Class counsel\nObjectors-appellants also take issue with the adequacy of Class counsel. They maintain \u201cthere was a direct conflict of interest between the attorneys and their clients, shareholders, forward\u201d following the date of the MOU. Objectors-appellants do not, however, explain what this conflict is. They take issue with Class counsel being paid on a contingency basis, citing the North Carolina Rules of Professional Conduct for the proposition that \u201cRule 1.8(f) . . . recognizes the inherent conflict where a third party defendant (Wells Fargo) pays for a litigant\u2019s attorneys fee [sic],\u201d but provide no further analysis. Rule 1.8(f) does not prohibit a lawyer from representing a class on a contingency basis. In fact, some class actions \u201care by their very nature contingency fee cases.\u201d Long v. Abbott Laboratories, 97-CVS-8289, 1999 WL 33545517 (N.C. Super. July 30,1999) (discussing class actions that create a common fund). We also note that the trial court found that Class counsel is \u201chighly respected and experienced in shareholder class action litigation.\u201d We are not persuaded that Class counsel deprived the Class of adequate and reasonable representation by virtue of a conflict of interest or insufficient class action proficiency.\n8. Opt-out certification\nObjectors-appellants contend the trial court\u2019s certification of a non-opt-out Class fell below procedural guarantees of the Due Process Clause of the Constitution of the United States. Specifically, Objectors-appellants maintain they should have been able to opt out of the Class and bring an action seeking damages. As this issue concerns a question of law, we review the trial court\u2019s decision in this matter de novo. Blitz, 197 N.C. App. at 300, 677 S.E.2d at 4. Citing Phillips Petroleum Co. v. Shutts, 472 U.S. 797, 812 n.3, 86 L. Ed. 2d, 628, 642 n.3 (1985), the trial court concluded the Class did not require opt-out rights because the parties did not attempt to bind Class members with respect to claims predominantly seeking monetary relief. In doing so, the court explained that, from the outset, Ehrenhaus pled and litigated the case as one seeking predominantly equitable relief.\nThe trial court focused on whether Ehrenhaus\u2019s claim sought equitable, rather than monetary, relief. The trial court\u2019s analysis relied heavily on the \u201cpredominance\u201d opt-out analysis employed by many courts. Although the United States Supreme Court recently criticized reliance on that analysis, we nevertheless hold the trial court reached the correct result.\nThe term \u201copt-out\u201d refers to a class member\u2019s ability exclude himself from a class action settlement. By opting out, the class member avoids the preclusive effect of the settlement, in that he is free to bring his own lawsuit. He also forgoes any payments he might receive from the settlement. .\nIn Shutts, the United States Supreme Court held that, when a class action seeks to bind the class members \u201cconcerning claims wholly or predominately for money judgments,\u201d due process requires opt-out rights for class members. Id. at 812 n.3, 86 L. Ed. 2d at 642 n.3. Federal Rule 23 authorizes non-opt-out classes, and the federal courts have developed a substantial, albeit somewhat inconsistent, body of law pertaining to class certification and opt-out rights. Under Federal Rule 23, there are three categories of class actions: the (b)(1) class, which, as a general matter, can be certified when individual adjudication is unworkable; the (b)(2) class, which can be certified when injunctive or declaratory relief will affect the entire class at once; and the (b)(3) class, which can be certified when a class action is a superior manner of adjudicating common questions of law or fact applicable to the entire class. See Fed. R. Civ. P. 23(b); Allison v. Citgo Petroleum Corp., 151 F.3d 402, 412 (5th Cir. 1998). Federal Rule 23 requires opt-out rights for (b)(3) classes, but not (b)(1) and (b)(2) classes. Consequently, federal court decisions concerning whether (b)(1) and particularly (b)(2) classes are appropriate are instructive. See Frost, 353 N.C. at 196, 540 S.E.2d at 330 (stating our decisions should be informed by federal decisions where appropriate).\nThere are numerous federal decisions stating (b)(2) certification is appropriate, even when the action seeks monetary relief, provided the damages sought do not \u201cpredominate\u201d or are \u201cincidental\u201d to the injunctive relief. E.g., Lemon v. Int\u2019l Union of Operating Engineers, Local No. 139, AFL-CIO, 216 F.3d 577, 581 (7th Cir. 2000); Allison, 151 F.3d at 412; DeBoer v. Mellon Mortg. Co., 64 F.3d 1171, 1175 (8th Cir. 1995); see also Manual for Complex Litigation (Fourth) \u00a7 21.221 (2004). When the class representative seeks injunctive or declaratory relief, a non-opt-out class is necessary \u201cto avoid unnecessary inconsistencies and compromises in future litigation.\u201d DeBoer, 64 F.3d at 1175. If a prospective settlement cannot bind all members of the class, the defendant has little motivation to settle. The underlying premise of the (b)(2) class is that it enjoys uniformity and therefore a lack of conflicts among class members. Allison, 151 F.3d at 413. \u201c[A] class seeking primarily equitable relief for a common injury is assumed to be a cohesive group with few conflicting interests, giving rise to a presumption that adequate representation alone provides sufficient procedural protection.\u201d In re Veneman, 309 F.3d 789, 792 (D.C. Cir. 2002). However, this homogeneity breaks down when claims for monetary relief hinge on individual injuries that differ across the class. Allison, 151 F.3d at 413.\nThe federal courts\u2019 analysis (implicitly, for the most part) involves a balancing of judicial economy and the procedural component of the Fourteenth Amendment. See Wal-Mart Stores v. Dukes, 564 U.S._,_, 180 L. Ed. 2d 374, 397-98 (2011) (\u201cSimilarly, (b)(2) does not require . . . opt-out rights, presumably because it is thought (rightly or wrongly) that notice has no purpose when the class is mandatory, and that depriving people of their right to sue in this manner complies with the Due Process Clause.\u201d). \u201cThe fundamental requisite of due process of law is the opportunity to be heard.\u201d Grannis v. Ordean, 234 U.S. 385, 394, 58 L. Ed. 1363, 1369 (1914). When homogeneity exists and the class\u2019s interests are aligned, non-opt-out certification does not offend due process. We assume each litigant does not need to be heard individually. But when uniformity is lacking, the class members\u2019 interests may not be aligned. Individual class members must be able to opt-out in these situations and exercise their right to be heard.\nRecently, in Wal-Mart Stores, the United States Supreme Court noted that there was a \u201cserious possibility\u201d that the Due Process Clause might forbid the certification of monetary claims in non-opt-out classes, even when they do not predominate. 564 U.S. at__, 180 L. Ed. 2d at 398. This possibility was one reason why the Court determined the class action could not be certified under (b)(2). Id. The Court explained that a \u201cmere \u2018predominance\u2019 \u201d of a proper (b)(2) claim does not cure notice and opt-out problems. Id. In Wal-Mart Stores, the named plaintiffs pleaded claims for injunctive relief and monetary relief in the form of back pay, which is equitable in nature. Id. They did not plead claims seeking compensatory damages. Id. This made it less likely that the monetary claims asserted in the lawsuit would predominate. Id. The Court explained that this strategy\nalso created the possibility (if the predominance test were correct) that individual class members\u2019 compensatory-damages claims would be precluded by litigation they had no power to hold themselves apart from. If it were determined, for example, that a particular class member is not entitled to backpay because her denial of increased pay or a promotion was not the product of discrimination, that employee might be collaterally estopped from independently seeking compensatory damages based on the same denial. That possibility underscores the need for plaintiffs with individual monetary claims to decide for themselves whether to tie their fates to the class representatives\u2019 [sic] or go it alone \u2014 a choice Rule 23(b)(2) does not ensure that they have.\nId.\nThe Court explicitly stated that its ruling did not address whether any form of incidental monetary relief could comply with the Due Process clause, Id., but it does indicate courts must be careful \u2014 more careful than they have previously been \u2014 to protect class members\u2019 due process rights when monetary claims are involved. Wal-Mart Stores also establishes that the claims pled by the named plaintiff are not the only claims that must be considered. It is critical that courts determine whether it offends due process to preclude monetary claims that are not plead as a basis for relief.\nIn this case, Objectors-appellants take issue with the preclusion of potential claims for damages against the Wachovia Board. These claims were not articulated before the trial court. The only claims brought to this Court\u2019s attention on appeal that could be brought as a class action are potential claims for diminution of shareholder voting strength and inadequate merger consideration. Because no Class member presented these to the trial court, there is no record for us to review. Although a trial court should examine potential liability of the Board for claims before approving a settlement, without a proffer by an Objector, an evaluation of any additional and unarticulated claims by this court would be speculative. Furthermore, it appears to us that the equitable claims brought by Ehrenhaus fully resolve any claim for diminution of shareholder voting strength, and the record fails to disclose any set of facts upon which a claim for inadequate merger consideration could have been based. We need not address the issue of whether any derivative action could have been brought because the procedural requirements for bringing such a claim are not in the record and it is unlikely that any such claim would be successful under these factual circumstances.\nThe predominant claim here was Ehrenhaus\u2019s attempt to enjoin the Merger. Objectors-appellants did not explain to the trial court, with any specificity, what causes of action they wished to bring and how the nature of those claims might impact the due process analysis. Our role is to review the trial court\u2019s ruling. Based on the claims that were articulated to the trial court by Appellees and Objectors-appellants, the trial court correctly determined due process does not require opt-out rights in this case.\n* * *\nIn conclusion, we disagree with Objectors-appellants\u2019 three arguments challenging class certification. First, the trial court\u2019s selection of Ehrenhaus as Class representative did not deprive the Class of adequate representation. Second, we are not persuaded Class counsel was inadequate. Third, the trial court did not err certifying a non-opt-out class. Therefore, we hold the trial court did not err in certifying this class action.\nC. Settlement Approval\n1. The likelihood of success and the benefits of the Settlement\nThe amended complaint sought relief based on allegations that the Wachovia Board breached its fiduciary duties by employing improper deal protection measures, failing to comply with statutory share exchange requirements, and failing to make material disclosures concerning the Merger. The amended complaint also alleged an aiding and abetting breach of fiduciary duty claim against Wells Fargo. Corporate directors owe fiduciary duties to the corporation. Pierce Concrete, Inc. v. Cannon Realty & Constr. Co., Inc., 77 N.C. App. 411, 413-14, 335 S.E.2d 30, 31 (1985). A fiduciary duty is\none in which \u201cthere has been a special confidence reposed in one who in equity and good conscience is bound to act in good faith and with due regard to the interests of the one reposing confidence . . . , [and] it extends to any possible case in which a fiduciary relationship exists in fact, and in which there is confidence reposed on one side, and resulting domination and influence on the other. \u201d\nDalton v. Camp, 353 N.C. 647, 651, 548 S.E.2d 704, 707-08 (2001) (quoting Abbitt v. Gregory, 201 N.C. 577, 598, 160 S.E. 896, 906 (1931) (some citations omitted). The General Statutes prescribe a standard of conduct for corporate directors: a director must discharge his duties \u201c(1) [i]n good faith; (2) [w]ith the care an ordinarily prudent person in a like position would exercise under similar circumstances; and (3) [i]n a manner he reasonably believes to be in the best interests of the corporation.\u201d N.C. Gen. Stat. \u00a7 55-8-30(a) (2009).\nIn discharging his duties a director is entitled to rely on information, opinions, reports, or statements, including financial statements and other financial data, if prepared or presented by:\n(1) One or more officers or employees of the corporation whom the director reasonably believes to be reliable and competent in the matters presented;\n(2) Legal counsel, public accountants, or other persons as to matters the director reasonably believes are within their professional or expert competence; or\n(3) A committee of the board of directors of which he is not a member if the director reasonably believes the committee merits confidence.\nN.C. Gen. Stat. \u00a7 55-8-30(b). \u201cThe duties of a director weighing a change of control situation shall not be any different, nor the standard of care any higher, than otherwise provided in this section.\u201d N.C. Gen. Stat. \u00a7 55-8-30(d).\nThe business judgment rule is a standard of review courts use to determine whether directors have met the statutory standard of conduct. The rule\ncreates, first, an initial evidentiary presumption that in making a decision the directors acted with due care (i.e., on an informed basis) and in good faith in the honest belief that their action was in the best interest of the corporation, and second, absent rebuttal of the initial presumption, a powerful substantive presumption that a decision by a loyal and informed board will not be overturned by a court unless it cannot be attributed to any rational business purpose.\nHammonds v. Lumbee River Elec. Membership Corp., 178 N.C. App. 1, 20-21, 631 S.E.2d 1, 13 (2006) (quoting Russell M. Robinson, II, Robinson on North Carolina Corporation Law \u00a7 14.06, at 14-16 to -17 (2005)).\nWe first address the allegation in Ehrenhaus\u2019s amended complaint that the share exchange violated Chapter 55 of the General Statutes when Wachovia issued the Wachovia Series M, Class A Preferred Stock, representing 39.9 percent of the Wachovia\u2019s aggregate voting rights in exchange for 1000 shares of Wells Fargo common stock. (The class is prohibited from mounting further challenges to the share exchange by the Settlement.)\nEhrenhaus alleged, and Objectors-appellants maintain, the Wachovia Board failed to comply with subsection 55-10-03(b), which states that \u201cafter adopting the proposed amendment [of the articles of incorporation] the board of directors must submit the amendment to the shareholders for their approval.\u201d N.C. Gen. Stat. \u00a7 55-10-03(b) (2009). In a proper case, a breach of fiduciary duty claim may be premised on a violation of the North Carolina Business Corporation Act. See Robinson, supra, \u00a7 14.03[3], at 14-9 to -10 (\u201cThe duty of care requires the directors of every corporation to see that it is operated according to the terms of its articles of incorporation, and, it would seem, also according to law.\u201d (footnotes omitted)); Miller v. Am. Tel. & Tel. Co., 507 F.2d 759, 763 (3d Cir. 1974) (concluding statutory violation could form the basis for breach of fiduciary duty claim). Objectors-appellants contend an amendment is required because section 55-10-02, which provides a list of amendments that do not require shareholder approval, does not authorize the issuance of shares that will dilute shareholder voting rights. See N.C. Gen. Stat. \u00a7 55-10-02 (2009). This line of reasoning assumes an amendment to the articles of incorporation was required.\nSubsection 55-6-01(a) states that \u201c[t]he articles of incorporation must prescribe the classes of shares and the number of shares of each class that the corporation is authorized to issue.\u201d N.C. Gen. Stat. \u00a7 55-6-01(a) (2009). Aside from several exceptions not applicable here, \u201cafter adopting [a] proposed amendment the board of directors must submit the amendment to the shareholders for their approval.\u201d N.C. Gen. Stat. \u00a7 55-10-03(b) (2009). In 1990, the Wachovia (then First Union Corporation) shareholders authorized the Board to issue the Class A preferred shares. The articles of incorporation were modified to allow the board to issue \u201cClass A Preferred Stock.\u201d The amendment permitted the Board to issue the shares \u201cfrom time to time in one or more series.\u201d It also authorized the Board to set the \u201cprovisions as to voting rights, if any.\u201d Thus, it appears the shareholders previously authorized the Series M, Class A Preferred Stock.\nObjectors-appellants also point out that section 55-10-04 provides circumstances under which shareholders must be entitled to vote as a class. See N.C. Gen. Stat. \u00a7 55-10-04 (2009). But this section applies to amendments to articles of incorporation- \u2014 not the issuance of a class of shares already authorized by articles of incorporation. See id.\nObjectors-appellants next argue that, pursuant to subsection 55-ll-03(a), the Board was required to submit the share exchange to the shareholders for a vote. Subsection 55-ll-03(a) provides:\nAfter adopting a plan of merger or share exchange, the board of directors of each corporation party to the merger, and the board of directors of the corporation whose shares will be acquired in the share exchange, shall submit the plan of merger ... or share exchange for approval by its shareholders.\nN.C. Gen. Stat. \u00a7 55-ll-03(a) (2009). However, the term \u201cshare exchange,\u201d as it is employed by Chapter 55, does not apply to the transaction between Wachovia and Wells Fargo. Under Chapter 55, a share exchange is \u201ca transaction by which a corporation becomes the owner of all the outstanding shares of one or more classes of another corporation by an exchange that is compulsory on all owners of the acquired shares.\u201d N.C. Gen. Stat. \u00a7 55-11-02 commentary (2009); see also N.C. Gen. Stat. \u00a7 55-ll-02(a) (\u201cA corporation may acquire all of the outstanding shares of one or more classes or series of another corporation if the board of directors of each corporation adopts and its shareholders . . . approve the exchange.\u201d (emphasis added)). This transaction was not compulsory on any owners of the acquired shares because they were issued directly to Wells Fargo. There were no prior-owners of the acquired shares. Wells Fargo provided consideration to Wachovia in the form of Wells Fargo shares, but this type of \u201cshare exchange\u201d does not trigger the voting rights set forth in section 55-11-03.\nWe also conclude the Class had little or no chance of prevailing in a breach-of-fiduciary-duty claim against the Wachovia Board related to allegations that the share exchange was coercive. Among other prerequisites, in order for Wachovia and Wells Fargo to merge, a majority of Wachovia shareholder votes needed to be cast in favor of the Merger. See N.C. Gen. Stat. \u00a7\u00a7 55-11-01, -03 (2009). The failure to vote in favor of the Merger amounted to a vote against it. See id.\nOur research does not disclose any controlling authority on such a claim. Based on our review of Delaware decisions, we conclude that, in North Carolina, a deal protection measure, such as the share exchange here, cannot be so coercive that it deprives the preexchange shareholders of the opportunity to exercise their voting rights in a meaningful way. If \u201cthe vote will be a valid and independent exercise of the shareholders\u2019 franchise, without any specific preordained result which precludes them from rationally determining the fate of the proposed merger [a court] has no basis to intervene.\u201d In re IXC Communications, Inc. S\u2019holder Litig., No. 17334, 1999 Del. Ch. LEXIS 210 at *3 (Oct. 27, 1999). Two Delaware decisions illustrate this principle.\nIn In re IXC Communications, Inc. S\u2019holder Litig., Vice Chancellor (now Delaware Chief Justice) Steele addressed a similar situation. The case involved a merger between IXC Communications, Inc. (\u201cIXC\u201d) and Cincinnati Bell, Inc. (\u201cCBI\u201d). Id. at *2. The General Electric Pension Trust (\u201cGEPT\u201d) was IXC\u2019s largest shareholder. Id. at *7. CBI acquired half of GEPT\u2019s IXC holdings and secured a promise from GEPT to support the IXC-CBI merger with GEPT\u2019s remaining shares. Id. at *21. This effectively gave CBI control of about 40 percent of IXC\u2019s shares. Id. at *23.\nNoting that an independent majority of IXC shareholders controlled nearly 60 percent of all IXC shares, Chief Justice Steele stated that CBI had \u201cnot, in fact, \u2018locked up\u2019 an absolute majority of the votes required for the merger through the GEPT deal.\u201d Id. at *23-24. He opined that \u201c \u2018[ajlmosl locked up\u2019 does not mean \u2018locked up,\u2019 and \u2018scant power\u2019 may mean less power, but it decidedly does not mean \u2018no power.\u2019 \u201d Id. at *24. Because \u201ca numerical majority\u201d of independent shareholders were in a position to defeat the merger, he concluded, the vote-buying agreement did not \u201chave the purpose or effect of disenfranchising this remaining majority of shareholders.\u201d Id.\nIn Omnicare, Inc. v. NCS Healthcare, Inc., the Supreme Court of Delaware held that a corporate board of directors cannot \u201caccede to [a controlling shareholder] demand for an absolute \u2018lock-up.\u2019 \u201d 818 A.2d 914, 938 (Del. 2003). There, Genesis, Health Care Ventures, Inc. (\u201cGenesis\u201d) and Omnicare, Inc. (\u201cOmnicare\u201d) were competing to acquire NCS Healthcare, Inc. (\u201cNCS\u201d). Id. at 917. The NCS board approved a merger agreement with Genesis pursuant to which the NCS board was required to place the agreement before the NCS shareholders for a vote, even if the NCS board no longer recommended the merger. Id. at 918. Two NCS stockholders held a majority of the shareholder voting power; they entered into an agreement to vote all of their shares in favor of the merger. Id. The NCS board eventually withdrew its support for the merger, submitting it to the shareholders with a recommendation that the shareholders reject the proposed merger because the competing Omnicare bid was a superior transaction. Id.\nIn holding the NCS board breached its fiduciary duty to minority shareholders, the court explained that its decision\n[did] not involve the general validity of either stockholder voting agreements or the authority of directors to insert a . . . provision in a merger agreement [requiring the board to submit a merger to the shareholders even if the board later came to disapprove of the merger]. In this case, the NCS board combined those two otherwise valid actions and caused them to operate in concert as an absolute lock up, in the absence of an effective fiduciary out clause in the Genesis merger agreement.\nId. at 939.\nReturning to the matter at bar, the trial court concluded in its order denying Ehrenhaus\u2019s motion for preliminary injunction that he failed to establish by clear and convincing evidence that the share exchange was coercive. In so ruling, the court noted there were \u201cfew (if any)\u201d entities in position to offer a superior merger proposal, and that, in all likelihood, the federal government would not provide any financial assistance to Wachovia. Wells Fargo acquired only 40 percent of the Wachovia voting rights \u2014 nearly identical to the amount the GEPT effectively controlled in In re IXG Communications, Inc. S\u2019holder Litig. As was the case in Omnicare, the Wachovia Board agreed to a fiduciary out provision.\nThe facts of this case fall between the two Delaware decisions, but the critical distinction between the matter at bar and Omnicare is that the merger protection measures here did not prevent the shareholders from voting down the Merger. In Omnicare, the shareholders in favor of the merger had already locked up enough votes to ensure the merger would succeed. The fiduciary out clause forced the NCS board to submit the proposed merger for a shareholder vote, even if a superior merger opportunity arose; and a superior merger opportunity did, in fact, come available. While there was a similar fiduciary out clause in the matter at bar, independent shareholders held 60 percent of the voting rights and there was very little chance the Wachovia Board would receive a comparable merger offer from a different suitor. Once the voting agreement and fiduciary out clause were in place in Omnicare, the board of directors could not protect the independent shareholders from being forced into an inferior transaction. In this case, on the other hand, the independent shareholders could protect themselves. We conclude that, under these facts, it is highly unlikely the Class would have prevailed on a breach of fiduciary duty claim alleging the Wachovia Board breached its fiduciary duty by approving a coercive share exchange.\nThe amended complaint also alleged the \u201cdefinitive Proxy Statement contained] materially misleading statements and omissions\u201d and that \u201c[w]ithout material and accurate information, Wachovia\u2019s public shareholders c[ould not] make an informed judgment as to whether to vote for or against the Merger.\u201d We find the Delaware courts\u2019 articulation of the non-disclosure principle persuasive. We hold that North Carolina directors \u201care under a fiduciary duty to disclose fully and fairly all material information within the board\u2019s control when it seeks shareholder action.\u201d Stroud v. Grace, 606 A.2d 75, 84 (Del. 1992). Delaware has adopted a definition of the term \u201cmaterial\u201d from a United States Supreme Court securities law decision:\nAn omitted fact is material if there is a substantial likelihood that a reasonable shareholder would consider it important in deciding how to vote. This standard is fully consistent with Mills [v. Elec. Auto-Lite Co., 396 U.S. 375, 90 S. Ct. 616, 24 L. Ed. 2d 593] general description of materiality as a requirement that \u201cthe defect have a significant propensity to affect the voting process.\" It does not require proof of a substantial likelihood that disclosure of the omitted fact would have caused the reasonable investor to change his vote. What the standard does contemplate is a showing of a substantial likelihood that, under all the circumstances, the omitted fact would have assumed actual significance in the deliberations of the reasonable shareholder. Put another way, there must be a substantial likelihood that the disclosure of the omitted fact would have been viewed by the reasonable investor as having significantly altered the \u201ctotal mix\u201d of information made available.\nRosenblatt v. Getty Oil Co., 493 A.2d 929, 944 (Del. 1985) (alteration in original) (quoting TSC Indus. Inc. v. Northway, Inc., 426 U.S. 438, 449, 48 L. Ed. 2d 757, 766 (1976)). We believe this is an appropriate standard, and our review indicates Ehrenhaus raised potentially meritorious claims related to the fiduciary duty to disclose material facts.\nEhrenhaus also claimed that Wells Fargo aided and abetted a breach of fiduciary duty by the Wachovia Board. First, it is unclear whether such a cause of action exists in North Carolina. In re Bostic Constr., Inc., 435 B.R. 46, 66 (Bankr. M.D.N.C. 2010) (\u201cIt is not even clear that North Carolina recognizes a cause of action for aiding and abetting breach of fiduciary duty.\u201d); Battleground Veterinary Hosp., P.C. v. McGeough, No. 05 CVS 18918, slip op. at 7 (N.C. Super. Ct. Oct. 19, 2007) (\u201cIt remains an open question whether North Carolina law recognizes a claim for aiding and abetting breach of fiduciary duty.\u201d). Compare Ahmed v. Porter, 1:09CV101, 2009 WL 2581615 (W.D.N.C. June 23, 2009) (unpublished) (concluding North Carolina recognizes such a claim), with Laws v. Priority Tr. Servs. of N.C., L.L.C., 610 F. Supp. 2d 528, 532 (W.D.N.C. 2009) (concluding North Carolina does not recognize such a claim). This Court recognized an aiding and abetting theory of liability for federal securities laws violations in Blow v. Shaugnessy, 88 N.C. App. 484, 490, 364 S.E.2d 444, 447 (1988). However, the underlying rationale of that decision was abrogated by Cent. Bank of Denver v. First Interstate Bank of Denver, 511 U.S. 164, 128 L. Ed. 2d 119 (1994). Laws, 610 F. Supp. 2d at 532. We elect not to delve into whether such a claim exists because it is highly unlikely Ehrenhaus or another Class member could establish a primary fiduciary duty violation by the Wachovia Board. See Blow, 88 N.C. App. at 489, 364 S.E.2d at 447 (aiding and abetting theory required \u201ca securities law violation\u201d); Allied Capital Corp. v. GC-Sun Holdings, L.P., 910 A.2d 1020, 1039 (Del. Ch. 2006) (Delaware claim requires the fiduciary to breach his fiduciary duty and the non-fiduciary to participate knowingly in that breach). Because Ehrenhaus would have had a difficult time establishing the Wachovia Board breached its fiduciary duties, it would have been very difficult to establish Wells Fargo aided and abetted in a breach of fiduciary duty (assuming such a claim exists in this state).\nThe class action also sought relief on the basis that the tail provision \u2014 which provided the shares issued to Wells Fargo could not be redeemed by Wachovia for eighteen months following the shareholder vote on the Merger agreement, even if the Merger was not consummated \u2014 constituted a breach of fiduciary duty. The trial court agreed, enjoining the tail provision. Ultimately, the tail provision was eliminated from the share exchange, so the Class had no chance of prevailing on this claim.\nIn addition to negating the tail, Ehrenhaus was successful in securing disclosures by the Wachovia Board that aided shareholders in making an informed vote on the Merger. As the trial court found, the Settlement largely remedied the disclosure deficiencies alleged in Ehrenhaus\u2019s amended complaint. These disclosures included information concerning communications with potential suitors, communications with regulatory authorities prior to the Wachovia Board\u2019s vote on the Merger, and some of the methodologies utilized by Wachovia\u2019s financial advisors in evaluating the Merger. The trial court noted the Settlement did not require disclosure concerning a tax benefit to which Wells Fargo might be entitled as a result of the Merger. As we note above, however, we fail to see how information concerning tax benefits obtained by Wells Fargo would have been a critical piece of information for shareholders. In sum, the additional disclosures made by Wachovia pursuant to the Settlement largely alleviated the issues raised by the most meritorious part of Ehrenhaus\u2019s allegations.\n2. Other claims released by the Settlement\nThe Released Claims include all causes of action against Defendants-appellees arising under Ehrenhaus\u2019s complaint as well as any claims related to:\n(i) the Merger, the Merger Agreement, the Share Exchange Agreement or any amendment thereto; (ii) the fiduciary obligations of any of the Defendants in connection with the Merger, the Merger Agreement, and the Share Exchange Agreement; (iii) any discussions or negotiations in connection with the Merger, or Merger Agreement, the Share Exchange Agreement, or any amendment thereto; (iv) the issuance and terms of the Series M Shares; (v) the amendment to Wachovia\u2019s articles of incorporation with respect to the issuance of the Series M Shares; (vi) the Proxy Statement or any amendment or supplement thereto; and (vii) the disclosure obligations of any of the Defendants in connection with the Merger, the Merger Agreement, the Share Exchange Agreement, and any discussions or conduct preparatory thereto ....\nInitially, the Proposed Settlement excluded the following from the Released Claims: \u201c(i) the right of the Plaintiff or any members of the Class to enforce in the Court the terms of the Stipulation; or (ii) the claims asserted by plaintiffs in the Amended Class Action Complaint for Violations of the Federal Securities Laws, dated December 15, 2008, in Lipetz v. Wachovia Corp. et al., Civil Action No. 08-6171 (RJS) (S.D.N.Y.).\u201d The Settlement was modified to exclude the following from the Released Claims:\n(iii) the claims asserted by plaintiffs in the Consolidated Class Action Complaint filed on September 4, 2009 in In Re Wachovia Preferred Securities and Bond/Notes Litigation, Master File No. 09 Civ 6351 (RJS) (S.D.N.Y.); (iv) claims not arising out of either the Merger or events involving the negotiation of, terms of and disclosures related to the Merger, (v) claims that arise from Wachovia\u2019s business or the Defendants\u2019/Released Persons\u2019 acts or omissions before or after the Class period; (vi) claims arising from alleged mismanagement, misconduct, misrepresentations, or non-disclosures about Wachovia\u2019s business and/or its securities during the Class period unrelated to the Merger; (vii) claims relating to the decline in value.of Wachovia\u2019s share price before the Class period, or (viii) claims relating to the decline in value of Wachovia\u2019s share price during the Class period to the extent that such claims either arise from events, acts, or omissions that preceded the Class period or do not arise from the Merger.\nNotably, claims seeking relief based on a decrease in Wachovia\u2019s share price due to Wachovia\u2019s acquisition of Golden West fall into at least one of the categories of additional exclusions from the Released Claims.\nHowever, the exclusions from the Released Claims do not cover claims for damages related to un-alleged claims concerning the inadequacy of the Merger consideration. While Objectors-appellants failed to explain specifically what type of claim they wish to pursue, we note here that any action against the Wachovia Board would have little, if any, chance of success.\nThis type of lawsuit must hurdle the business judgment rule, which creates a strong presumption that the Wachovia Board acted with due care. A plaintiff may defeat this presumption only by demonstrating the Wachovia Board\u2019s conduct \u201ccannot be attributed to any rational business purpose.\u201d Hammonds, 178 N.C. App. at 20-21, 631 S.E.2d at 13. Given the time demands and tumultuous market conditions, the business judgment rule is likely insurmountable in this case.\nAfter the FDIC notified Wachovia that the FDIC intended to exercise its authority to conduct a forced sale of Wachovia to another financial institution, the Wachovia Board was under pressure to work out a deal with Citigroup or Wells Fargo. These were the only two potential suitors; the FDIC had rejected a deal that would have given the regulatory body an equity stake in Wachovia.\nWells Fargo offered more monetary consideration per share than Citigroup. And unlike Citigroup\u2019s offer, the proposal from Wells Fargo did not contain a material adverse change provision that would have allowed the acquiring institution to walk away from the deal if Wachovia experienced a material decline in value between signing the merger agreement and consummating it. Wachovia was successful in negotiating some concessions from Wells Fargo. Initially, Wells Fargo sought, through the share exchange, 50 percent of the voting power on the Merger. Wachovia negotiated the percentage down to 39.9 percent.\nThe Wachovia Board\u2019s advisors, Perella Weinberg and Goldman Sachs, uniformly advised against attempting to negotiate for superior terms in light of the time constraints imposed by the market and the FDIC. A director is entitled to rely on the advice of \u201c[l]egal counsel, public accountants, or other persons as to matters the director reasonably believes are within their professional or expert competence.\u201d N.C. Gen. Stat. \u00a7 55-8-30(b)(2) (2009). The director loses that protection, however, \u201cif he has actual knowledge concerning the matter in question that makes reliance\u201d unwarranted. N.C. Gen. Stat. \u00a7 55-8-30(c) (2009). We note that in this case, a large portion of both financial advisors\u2019 fees were contingent on the success of the merger with Wells Fargo. While the Wachovia Board should have tempered its reliance accordingly \u2014 and nothing suggests the Board did not \u2014 we believe Perella Weinberg\u2019s and Goldman Sachs\u2019 advice indicates the Board\u2019s conduct was reasonable under the circumstances.\n3. The reaction of the Class, recommendations of counsel, and notice adequacy\nThere were over 150,000 Wachovia shareholders and over two billion shares of stock. The trial court received over 200 letters and emails regarding this case and remarked that much of that correspondence was directed to issues that were not before the court. Counsel indicated they received hundreds of calls from individuals unhappy with the Settlement, but there are only two remaining objectors in this case: Mr. Robinson and Mr. Loughridge. \u201cIn the class action context, silence may be construed as assent.\u201d In re GNC S\u2019holder Litig.: All Actions, 668 F. Supp. 450, 451 (W.D. Pa. 1987). Provided there has been adequate notice of the terms of a settlement, a dearth of objections may indicate a settlement is fair. In re Am. Bank Note Holographics, Inc., 127 F. Supp. 2d 418, 425 (S.D.N.Y. 2001). The trial court viewed the reaction of the Class as \u201cmuted,\u201d which supported a finding that the Settlement is fair, reasonable, and adequate. The trial court was in the best position to determine whether the public outcry over the Settlement raised fairness concerns grounded in law. Furthermore, given the unlikely prospect of success on any of the claims in this case, even if the trial court underestimated the legitimate complaints of Class members, the court\u2019s appraisal of the Class reaction did not rise to the level of an abuse of discretion.\nThe trial court also based its decision on the recommendations of counsel. The trial court specifically found that Ehrenhaus\u2019s attorneys are \u201chighly respected and experienced in shareholder class action litigation.\u201d The court agreed with both plaintiff and defense counsel that the Settlement is a \u201creasonable compromise given the uncertain value of the remaining claims and the expense and delay that would result from further litigation.\u201d \u201c[T]he opinion of experienced and informed counsel is entitled to considerable weight.\u201d Id. at 430. At the Settlement approval hearing, the trial court inquired as to why the discovery confirmed the reasonableness of the Settlement. Ehrenhaus\u2019s counsel replied that, based on the depositions of executives involved in the case, \u201cthere were pieces here and there that. . . were favorable to [Ehrenhaus\u2019s] position, but Overall it wasn\u2019t even close.\u201d\nOur review also indicates the parties employed proper procedures for providing notice to absent Class members. The trial court required Wells Fargo to mail notice of the Proposed Settlement to Class members on or before 24 May 2009 at the last address appearing in Wachovia\u2019s stock transfer records. The notice instructed record owners of stock who were not also the beneficial holders to forward the notice to the beneficial holders. Wells Fargo employed Georgeson, Inc., a proxy solicitation firm, to distribute the notice. Georgeson, Inc., distributed the notice to the required recipients on 22 May 2009. The firm also contacted over 450 banks, brokers, and other intermediaries that might have held shares on behalf of beneficial owners of Wachovia stock. Over one million copies of the notice were distributed to Class members. Our review indicates the contents of the notice adequately apprised Class members of the Proposed Settlement and Settlement hearing.\n4. Attorneys\u2019Fees\nIn their factual analysis, Objectors-appellants state, \u201cIn the Court\u2019s 5 February 2010 Order, the fact that the [sic] Ehrenhaus\u2019s counsel had a contingency fee agreement was revealed for the first time and yet a fee was allowed by the Court despite no award to the shareholders.\u201d Their contentions are that the Settlement was negotiated prior to any hearing on the adequacy of Class counsel and an agreement that Class counsel was to be paid \u201c$2 million by the [Defendants-appellees] and the shareholders were to receive nothing.\u201d Objectors-appellants further contend that, \u201c[f]rom the date of the settlement (17 December 2008) there was a direct conflict of interest between the attorneys and their clients, the shareholders, forward. The attorneys for the shareholders have refused to talk with Appellants or correspond with them in any way concerning the facts of the case.\u201d Furthermore, Objectors-appellants contend, \u201cEhrenhaus\u2019[s] attorneys were to be paid, by agreement, almost $2,000,000 by Wells Fargo. The Court finally approved a fee of $900,000 plus expenses. There is no evidence as to what the attorneys or Ehrenhaus have actually received or been promised.\u201d The Objectors-appellants contend that the trial court did not perform the \u201crigorous\u201d analysis required under Rule 23.\nNorth Carolina follows the American Rule with regard to award of attorney\u2019s fees. In Stillwell Enterprises, Inc. v. Interstate Equipment Co., our Supreme Court opined as follows:\nAs was stated by Chief Judge (now Justice) Brock in Supply, Inc. v. Allen, \u201c[t]he jurisprudence of North Carolina traditionally has frowned upon contractual obligations for attorney\u2019s fees as part of the costs of an action.\u201d Certainly in the absence of any contractual agreement allocating the costs of future litigation, it is well established that the non-allowance of counsel fees has prevailed as the policy of this state at least since 1879. Thus the general rule has long obtained that a successful litigant may not recover attorneys\u2019 fees, whether as costs or as an item of damages, unless such a recovery is expressly authorized by statute. Even in the face of a carefully drafted contractual provision indemnifying a party for such attorneys\u2019 fees as may be necessitated by a successful action on the contract itself, our courts have consistently refused to sustain such an award absent statutory authority therefor.\n300 N.C. 286, 289, 266 S.E.2d 812, 814-15 (1980) (citations omitted).\nThere are, however, certain exceptions to this rule. One such exception, which applies in North Carolina, is the \u201ccommon fund doctrine\u201d:\n[T]he rule is well established that a court of equity, or a court in the exercise of equitable jurisdiction, may in its discretion, and without statutory authorization, order an allowance for attorney fees to a litigant who at his own expense has maintained a successful suit for the preservation, protection, or increase of a common fund or of common property, or who has created at his own expense or brought into court a fund which others may share with him.\nHorner v. Chamber of Commerce, 236 N.C. 96, 97-98, 72 S.E.2d 21, 22 (1952). When, as here, there is no common fund, courts in some jurisdictions can award attorney\u2019s fees under the \u201ccommon benefit\u201d doctrine.\nThe \u201ccommon benefit doctrine\u201d is another equitable exception to the American Rule. The Delaware Supreme Court explained the doctrine as follows:\n\u201c[A] litigant who confers a common monetary benefit upon an ascertainable stockholder class is entitled to an award of counsel fees and expenses for its efforts in creating the benefit. . . . [T]o be entitled to an award of fees under the corporate benefit doctrine, an applicant must show . . . that:\n(1) the suit was meritorious when filed;\n(2) the action producing benefit to the corporation was taken by the defendants before a judicial resolution was achieved; and\n(3) the resulting corporate benefit was causally related to the lawsuit.\u201d\nCal-Maine Foods, Inc. v. Pyles, 858 A.2d 927, 929 (Del. 2004) (quoting United Vanguard Fund v. Takecare, Inc., 693 A.2d 1076, 1079 (Del. 1997)) (alterations in original).\nThe parties to this Settlement originally entered into a memorandum of understanding and a stipulation that, subject to court approval, settled all outstanding issues between the Class, Wachovia, the Wachovia Board, and Wells Fargo. The text of the stipulation reads as follows:\nAs part of the terms and conditions of this Stipulation, Wells Fargo agrees to pay to Plaintiffs Counsel, for their efforts in achieving the benefits of the Settlement of this Action, the sum of $1,975 million, for their fees and litigation-related expenses, subject to Court approval of the Settlement contemplated by this Stipulation. Wells Fargo shall make payment to Wolf Popper LLP of the fees and expenses provided in this paragraph within five days of the Court\u2019s order approving the Settlement, subject to Plaintiff\u2019s Counsel\u2019s obligation to repay such amount as may become necessary should the Settlement not obtain Final Court Approval or the fees and expenses become reduced or modified on any appeal.\nThis stipulation was later modified so that the trial court had to determine the final amount of the fees to be awarded and the parties agree only to pay \u201cup to\u201d $1,975 million. The court further found that Plaintiff\u2019s counsel did not submit time records detailing the work done on the case. Furthermore, the lodestar calculation as submitted by counsel requested an award of $1,325,168.50 in fees and $32,621.98 in expenses.\nWe read the procedure as adopted by the trial court as the functional equivalent of requiring the court to make an award of attorney\u2019s fees. This case does not involve a settlement expressly dependent upon payment of a liquidated amount of attorney\u2019s fees. However, here the court was asked to award a fee and not approve a fee agreed to by the parties. While any \u201ccompromise\u201d in a class action must be reviewed by a court, a court cannot modify a purely contractual settlement. See Cabarrus Cty. v. Systel Bus. Equip. Co., 171 N.C. App. 423, 425, 614 S.E.2d 596, 597 (2005) (stating settlements are interpreted according to \u201cgeneral principles of contract law); Cherry, Bekaert & Holland v. Worsham, 81 N.C. App. 116, 120, 344 S.E.2d 97, 100 (1986) (stating that courts cannot rewrite the plain language\u2019 of a contract).\nRegrettably, we are unable to adequately review the decision of the trial court for lack of complete findings of fact and conclusions of law on the issue of attorney\u2019s fees. For the following reasons, we vacate that portion of the court\u2019s order regarding attorney\u2019s fees and remand the matter for additional findings of fact and conclusions of law. The reasonableness of attorney\u2019s fees in this state is governed by the factors found in Rule 1.5 of the Revised Rules of Professional Conduct of the North Carolina State Bar.\n(a) A lawyer shall not make an agreement for, charge, or collect an illegal or clearly excessive fee or charge or collect a clearly excessive amount for expenses. The factors to be considered in determining whether a fee is clearly excessive include the following:\n(1) the time and labor required, the novelty and difficulty of the questions involved, and the skill requisite to perform the legal service properly;\n(2) the likelihood, if apparent to the client, that the acceptance of the particular employment will preclude other employment by the lawyer;\n(3) the fee customarily charged in the locality for similar legal services;\n(4) the amount involved and the results obtained;\n(5) the time limitations imposed by the client or by the circumstances;\n(6) the nature and length of the professional relationship with the client;\n(7) the experience, reputation, and ability of the lawyer or lawyers performing the services; and\n(8) whether the fee is fixed or contingent.\n(b) When the lawyer has not regularly represented the client, the scope of the representation and the basis or rate of the fee and expenses for which the client will be responsible shall be communicated to the client, preferably in writing, before or within a reasonable time after commencing the representation.\n(c) A fee may be contingent on the outcome of the matter for which the service is rendered, except in a matter in which a contingent fee is prohibited by paragraph (d) or other law. A contingent fee agreement shall be in a writing signed by the client and shall state the method by which the fee is to be determined, including the percentage or percentages that shall accrue to the lawyer in the event of settlement, trial or appeal; litigation and other expenses to be deducted from the recovery; and whether such expenses are to be deducted before or after the contingent fee is calculated. The agreement must clearly notify the client of any expenses for which the client will be liable whether or not the client is the prevailing party. Upon conclusion of a contingent fee matter, the lawyer shall provide the client with a written statement stating the outcome of the matter and, if there is a recovery, showing the remittance to the client and the method of its determination.\n(d) A lawyer shall not enter into an arrangement for, charge, or collect:\n(2) a contingent fee in a civil case in which such a fee is prohibited by law.\n(e)A division of a fee between lawyers who are not in the same firm may be made only if:\n(1) the division is in proportion to the services performed by each lawyer or each lawyer assumes joint responsibility for the representation;\n(2) the client agrees to the arrangement, including the share each lawyer will receive, and the agreement is confirmed in writing; and\n(3) the total fee is reasonable.\nN.C. Rev. R. Prof. Conduct 1.5 (2011).\nAt the fairness hearing, Class counsel and the Class representative announced that the fee agreement they had negotiated was a \u201ccontingent\u201d fee. Without the written agreement of the parties, as required by Rule 1.5, as to their agreed-upon compensation, it would be problematic for the Court to determine what amount would be reasonable.\nSecond, the decision of the court fails to make any allowance for an award to North Carolina local counsel. Clearly both the local and Class counsel participated in the results obtained and the award, if any, should consider both firms\u2019 efforts. Furthermore, Rule 1.5(e)(2) provides that the client must agree to any fee sharing agreement in writing. Id. The record contains no such agreement.\nNext, the attorneys did not present contemporaneous records showing the number of hours expended and the hourly rates for the attorneys charged. It would be difficult for the Court to draw a conclusion of what amount of time Class counsel spent litigating compensable matters without such records. Furthermore, although the Court may take judicial notice of these efforts, some evidence must be presented from a witness that the fee sought would be that which is customarily charged in the locality for similar legal services.\nRule 1.5(e) also provides that a contingency fee cannot be charged in a civil case in which such a fee is prohibited by law. Because the trial court did not examine the contingency fee nature of the written agreement, we cannot know the legal basis upon which the parties agreed to the contingency. In In re Wachovia S\u2019holder Litig., the trial court awarded attorney\u2019s fees using the common benefit doctrine and urged the appellate courts of this state adopt this exception to the American Rule. See 2003 NCBC 10 \u00b674 (N.C. Super. Ct. Dec. 19, 2004) (unpublished), rev\u2019d, In re Wachovia S\u2019holder Litig., 168 N.C. App. 135, 607 S.E.2d 48 (2005). However, this Court specifically rejected the common benefit theory as an exception to the American Rule in this state. In re Wachovia Shareholders Litig., 168 N.C. App. at 140, 607 S.E.2d at 51. We view the resolution of this issue as central to the question of whether there is any evidence of a settlement. While we presume good faith on the part of all counsel admitted to practice, the shareholders had a right to adequate disclosure of information on this issue since they are being asked to pay a portion of the fees' and a fiduciary relationship exists.\nWhile the trial court\u2019s analysis did partially complete its task, it did not finish the task of reviewing the necessary evidence to make its decision. On remand, we trust the trial court to examine additional evidence and to make the appropriate findings of fact and conclusions of law, including a reasoned decision on the issue of how it arrived at the figure to be awarded.\nD. Alleged Omission of Evidence from the Record and Refusal to Consider Material Evidence\nThe heading of Objectors-appellants\u2019 brief states that \u201cthe trial court erred in omitting from the record and failing to consider material evidence in approving the settlement.\u201d (Capitalization omitted). The body of this section fails to support this argument with even a single citation to legal authority, violating the Rules of Appellate Procedure. N.C.R. App. P. 28(b)(6) (\u201cThe body of the argument . . . shall contain citations of the authorities upon which the appellant relies.\u201d); cf. Hatcher v. Harrah\u2019s NC Casino Co., 169 N.C. App. 151, 159, 610 S.E.2d 210, 214-15 (2005) (\u201c[P]laintiff fails to cite any legal authority in support of his position. Accordingly, we conclude that this issue does not warrant appellate review, and Aye dismiss this assignment of error.\u201d). Furthermore, Objectors-appellants fail to explain what legal principle would entitle them to relief on appeal. This argument is without merit.\nIV. Conclusion\nFor the foregoing reasons, the ruling of the trial court is\nAffirmed in part and Reversed in part.\nJudges CALABRIA and STROUD concur.\n. Freddie Mac and Fannie Mae are government-sponsored enterprises whose stock was publically traded. These organizations would buy mortgages on the secondary market, pool them, and sell them as mortgage backed securities to investors. By purchasing mortgages from conventional lenders, the lenders assets could be used for additional loans, theoretically expanding the secondary mortgage market. The seizure of these institutions signaled that mortgage backed securities held by financial institutions were problematic to their holders, including investment banks.\n. A material adverse change provision gives the acquiring company the right to walk away from the deal in the event the target company experiences a significant adverse event or a material decline in value in the time period between signing and closing.\n. Wachovia\u2019s financial advisors (Parella Weinberg and Goldman Sachs) both expected \u2014 pending completion of due diligence and a financial review of the final documentation \u2014 to be able to render an opinion that the exchange ratio pursuant to the merger agreement was fair to Wachovia\u2019s shareholders. These opinions were later confirmed in writing.\n. Citigroup initiated litigation to force Wachovia to merge with Citigroup, rather than Wells Fargo, but was ultimately unsuccessful.\n. Several days after the Board executed the merger documents, Wachovia reported a $9.1 billion loss for the second quarter of 2008 on 22 October 2008. Wachovia\u2019s poor performance was due in part to losses related to assets acquired as part of its purchase of Golden West.\n. If the voting power held by Wells Fargo is completely disregarded, i.e., we assume the shares were never issued to Wells Fargo, over 50 percent of the independent Wachovia shareholders voted to approve the Merger.\n. Objectors-appellants do not point to any evidence in the record that Ehrenhaus purchased stock immediately prior to the Merger for the sole purpose of challenging the Merger or that he conspired with management to engage in sweetheart litigation to eliminate legitimate claims of Class members. Had such evidence existed, the Court\u2019s determination may have been different, but speculation that such a conflict of interest is present is very distinct from proof of such a conflict.\n. Delaware applies various standards of review to evaluate director conduct related to different types of transactions. See Thanos Panagopoulos, 3 Berkley Bus. L.J. 437 (2006). In Omnicare, the Delaware Supreme Court employed the \u201cUnocal\u201d standard of review, which places enhanced scrutiny on deal protection measures beyond that of the business judgment rule. 818 A.2d at 934. Nothing in our opinion should be construed as adopting a standard of review that varies from the business judgment rule; that issue is not before us. Rather, we contrast Omnicare with In re IXC Communications, Inc. S\u2019holder Litig. to illustrate the considerations involved in determining whether deal protection measures are coercive.\n. The trial court cited In re Wachovia Shareholders Litig., 2003 NCBC 10, but it is unclear whether that opinion formed the basis for the trial court\u2019s decision to award attorney\u2019s fees in this case.", "type": "majority", "author": "HUNTER, JR., Robert N., Judge." } ], "attorneys": [ "Greg Jones & Associates, P.A., by Gregory Jones, and Wolf Popper LLP, by Robert M. Komreich, Chet Waldman, and Carl L. Stine, for Plaintiff-appellee.", "Robinson Bradshaw & Hinson, P.A., by Robert W. Fuller, Mark W. Merritt, \u25a0 Louis A. Bledsoe, III, and Adam K. Doerr, for Defendants-appellees.", "Norwood Robinson and John H. Loughridge, pro se." ], "corrections": "", "head_matter": "IRVING EHRENHAUS, On Behalf of Himself and All Others Similarly Situated, Plaintiff-appellee v. JOHN D. BAKER, II, PETER C. BROWNING, JOHN T. CASTEEN, III, JERRY GITT, WILLIAM H. GOODWIN, JR., MARYELLEN C. HERRINGER, ROBERT A. INGRAM, DONALD M. JAMES, MACKEY J. McDONALD, JOSEPH NEUBAUER, TIMOTHY D. PROCTOR, ERNEST S. RADY, VAN I. RICHEY, RUTH G. SHAW, LANTY L. SMITH, DONA DAVIS YOUNG, WACHOVIA CORPORATION and WELLS FARGO & COMPANY, Defendants-appellees v. NORWOOD ROBINSON and JOHN H. LOUGHRIDGE, JR., Objectors-appellants\nNo. COA10-1034\n(Filed 4 October 2011)\n1. Class Actions \u2014 appeal of prior injunction denial \u2014 no authority\nThe Court of Appeals declined to consider the question of whether objector-appellants in a class action could appeal the denial of a preliminary injunction when that denial occurred before they became involved in the case. Authority permitting such an appeal was not cited nor found.\n2. Class Actions \u2014 class representative \u2014 adequate\nA class representative was adequate in a class action suit and settlement arising from the merger of Wachovia and Wells Fargo. Owning a relatively small number of shares is not a bar to. a class member serving as a class representative, and there was no authority cited for the proposition that a trial court may not conduct a final certification hearing after the parties have agreed in principal to a settlement.\n3. Class Actions \u2014 class counsel \u2014 adequate and sufficient representation\nThe Court of Appeals was not persuaded that the class counsel in a class action suit deprived the class of adequate and reasonable representation by virtue of a conflict of interest or insufficient class action proficiency.\n4. Class Actions \u2014 bank merger \u2014 settlement agreement \u2014 opt-out rights not required\nThe trial court did not err in a class action suit by determining that due process did not require opt-out rights based on the claims that were articulated to the trial court. The predominant claim was plaintiffs attempt to enjoin the merger of two banks.\n5. Banks and Banking \u2014 bank merger \u2014 Board\u2019s fiduciary duties\nThe Wachovia Board did not breach its fiduciary duties during a merger by employing improper deal protection measures, failing to comply with statutory share exchange requirements, and failing to make material disclosures. The statutes alleged to have been violated were not applicable; the class had little or no chance of prevailing on a breach of fiduciary duty claim against the Board related to an allegedly coercive share exchange; and, although plaintiff raised potentially meritorious claims related to the fiduciary duty to disclose material facts, additional disclosures made pursuant to the settlement largely alleviated those issues.\n6. Banks and Banking \u2014 bank merger \u2014 approval of settlement \u2014 release of claims\nThe trial court did not err by approving a settlement involving the release of claims in a class action arising from a bank merger. Given the tumultuous market conditions and the time demands under which the Wachovia Board acted, the business judgment rule was likely insurmountable on the issue of release of claims.\n7. Class Actions \u2014 public reaction \u2014 trial court\u2019s discretion\nThe trial court was in the best position to determine whether the public outcry over a class action settlement raised fairness concerns grounded in law. The trial court\u2019s appraisal of the public reaction as \u201cmuted,\u201d which supported a finding that the settlement was fair, did not rise to the level of an abuse of discretion.\n8. Class Actions \u2014 approval of settlement \u2014 recommendations of counsel\nThe trial court did not err when approving a class action settlement by basing its decision in part on the recommendations of counsel. Moreover, the contents of the notice to class members adequately apprised them of the proposed settlement and hearing.\n9. Class Actions \u2014 settlement\u2014attorney fees\nThe portion of an order approving a settlement in a class action that concerned attorney fees was remanded where the trial court did not make complete findings of fact and conclusions of law.\n10.Appeal and Error \u2014 preservations of issues \u2014 brief\u2014authority not cited \u2014 issue not considered\nAn issue was not reviewed on appeal where the brief did not contain any citations of legal authority on the issue and the appellants did not explain a legal principle that would entitle them to relief.\nAppeal by Objectors-appellants from judgment entered 5 February 2010 by Judge Albert Diaz in Mecklenburg County Superior Court. Heard in the Court of Appeals 9 February 2011.\nGreg Jones & Associates, P.A., by Gregory Jones, and Wolf Popper LLP, by Robert M. Komreich, Chet Waldman, and Carl L. Stine, for Plaintiff-appellee.\nRobinson Bradshaw & Hinson, P.A., by Robert W. Fuller, Mark W. Merritt, \u25a0 Louis A. Bledsoe, III, and Adam K. Doerr, for Defendants-appellees.\nNorwood Robinson and John H. Loughridge, pro se." }, "file_name": "0059-01", "first_page_order": 69, "last_page_order": 109 }