# kaal:claim:5583610-016

**Claim.** Under Blasius, LER should function as a last-resort tool justified by evidence of severe harm to the corporation, such as an activist's documented history of value destruction, so that courts can test whether less restrictive alternatives existed.

**Type.** condition  **Support.** argued

**Holds when.**

- board action that intentionally frustrates shareholder voting
- Blasius compelling justification review

**Source quote.**

> LER deployment must be justified by evidence of severe harm to the corporation. Examples may include an activist's history of value destruction. LER should be a last-resort tool, allowing courts to scrutinize if less restrictive alternatives exist.

**From.** Wulf A. Kaal, *Liquid Equity Rewards in Corporate America* (2025), 4.3. Legal Boundaries Under Delaware and SEC Rules, page 20

**Cite as.** Wulf A. Kaal, Liquid Equity Rewards in Corporate America (2025). SSRN: https://ssrn.com/abstract=5583610

**Verify.** sha256 of source PDF `2d73609d95ddb1573acc2a9e7af617fbe6283d6e591deb6317f6d5d804517c62` at https://raw.githubusercontent.com/wulfkaal/Academic-Papers/main/papers/pdf/Kaal%20-%202025%20-%20Liquid%20Equity%20Rewards%20in%20Corporate%20America.pdf

**Topics.** governance-design

**Keywords.** blasius, compelling-justification, last-resort, voting-rights

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