The recent Dole and Kinder Morgan Court of Chancery opinions highlight the differing roles of fiduciary duties in corporations and limited partnerships. The Dole shareholder litigation questioned the actions of corporate board members in considering an insider offer to buy the outstanding public shares to take the company private. In Kinder Morgan, limited partners were challenging the general partner’s decisions in negotiating a complex merger transaction that resulted in differing treatments for different classes of limited partners.
This post (i) summarizes the basic fiduciary duties of corporate fiduciaries and limited partnership fiduciaries, and (ii) considers how the facts in Dole would be treated if they were governed by the terms of the Kinder Morgan partnership agreement. Thus, this analysis will probe the outer limits of permissible conduct under limited partnership agreements.