§ 31-709 — Injunctions, prohibitions against voting securities, sequestration of voting securities.

District of Columbia § 31-709

• Jurisdiction: District of Columbia
• Title 31: Insurance and Securities.
• Ch. 7: Holding Companies.
• Subch. I: Holding Company System.

Text

(a) Whenever it appears to the Mayor that any insurer or any director, officer, employee, or agent has committed, or is about to commit, a violation of this subchapter or of any rule, regulation, or order issued by the Mayor, the Mayor may apply to the Superior Court of the District of Columbia for an order enjoining the insurer or the director, officer, employee, or agent from violating or continuing to violate this subchapter or any rule, regulation, or order, and for any other equitable relief as the nature of the case and the interest of the insurer’s policyholders, creditors, and shareholders or the public may require.

(1) No security which is the subject of any agreement or arrangement regarding acquisition, or which is acquired, or to be acquired, in contravention of the provisions of this subchapter, or of any rule, regulation, or order issued by the Mayor pursuant to this subchapter, may be voted at any shareholder’s meeting, or may be counted for quorum purposes, and any action of shareholders requiring the affirmative vote of a percentage of shares may be taken as though the securities were not issued and outstanding; but no action taken at such a meeting shall be invalidated by the voting of these securities, unless the action would materially affect control of the insurer or unless the courts of the District of Columbia have so ordered.

(2) If an insurer or the Mayor has reason to believe that any security of the insurer has been, or is about to be, acquired in contravention of the provisions of this subchapter or of any rule, regulation, or order issued by the Mayor pursuant to this subchapter, the insurer or the Mayor may apply to the Superior Court of the District of Columbia to enjoin any offer, request, invitation, agreement, or acquisition made in contravention of § 31-703 or any rule, regulation, or order issued by the Commissioner to enjoin the voting of any security so acquired, to void any vote of such a security already cast at any meeting of shareholders, and for any other equitable relief as the nature of the case and the interest of the insurer’s policyholders, creditors, and shareholders or the public may require.

(c) In any case where a person has acquired, or is proposing to acquire, any voting securities in violation of this subchapter or any rule, regulation, or order issued by the Mayor pursuant to this subchapter, the Superior Court of the District of Columbia may, on that notice the court deems appropriate and upon the application of the insurer or the Mayor, seize or sequester any voting securities of the insurer owned directly or indirectly by the person, and issue an order appropriate to effectuate the provisions of this subchapter.

(d) Notwithstanding any other provisions of law, for the purposes of this subchapter the sites of the ownership of the securities of domestic insurers shall be deemed to be in the District.

Legislative History

Oct. 21, 1993, D.C. Law 10-44, § 11, 40 DCR 6027; Sept. 8, 1995, D.C. Law 11-36, § 8(c), 42 DCR 3257; Feb. 27, 1996, D.C. Law 11-90, § 8(c), 42 DCR 7155; May 21, 1997, D.C. Law 11-268, § 10(gg)(2), 44 DCR 1730