Actions Semiconductor defends claims by former employees alleging entitlement to stock options as part of compensation agreement
Clients Actions Semiconductor Co., Ltd.
Jones Day successfully defended Actions Semiconductor Co., Ltd. against claims by two former employees that they were granted stock options as part of their compensation arrangements. Actions is a semiconductor manufacturer based in Zhuhai, People's Republic of China whose chip technology is used in MP3 and other media players. Plaintiffs did not sue the Zhuhai-based operating company they worked for; instead, they sued other Actions entities, including the Cayman Islands company whose shares are publicly traded (as American Depository Shares, or ADSs), and an intermediate Mauritius holding company. Following jurisdictional discovery, the court dismissed the case under Federal Rule of Civil Procedure 12(b)(2) for lack of personal jurisdiction, finding that none of plaintiffs' claims arose from any of their purported contacts and interactions with Actions Cayman Islands or Mauritius, as their employment arrangements were with Actions Zhuhai. The court also found that neither Actions Cayman Islands nor Mauritius had their own contacts in California, and it rejected plaintiffs' claims that the Actions entities they had sued were responsible under alter ego or agency theories, particularly since the public holding company whose stock the plaintiffs sought was formed several years after the stock options allegedly were promised.
Fred Young, et al. v. Actions Semiconductor Co., Ltd., et al., Civil No. 06CV1667 MMA (AJB) (S.D. Cal.)