## Facts

- E.ON AG and related entities (E.ON), German energy companies, announced an intention to make a tender offer for Endesa, S.A., Spain’s largest electric utility.
- Endesa’s shares traded in the United States as American Depositary Shares on the New York Stock Exchange.
- Acciona, S.A. and an affiliate (Acciona) acquired over 20% of Endesa’s equity.
- Because of Acciona’s holdings, § 13(d) of the Securities Exchange Act required Acciona to file Schedule 13D disclosures describing its purchases, financing arrangements, and intentions regarding control.
- E.ON alleged Acciona’s Schedule 13D filings contained material misstatements and omissions, including incomplete or inaccurate disclosure of arrangements with Banco Santander Central Hispano, S.A. and Acciona’s plans and intentions toward Endesa.
- E.ON sued for injunctive relief seeking corrective filings and restrictions on Acciona’s ability to acquire or vote Endesa securities.
- Acciona moved to dismiss, arguing a competing tender offeror lacked standing under § 13(d) and that the complaint failed to state a claim.
- E.ON simultaneously moved for a preliminary injunction; the court addressed only the motion to dismiss and reserved the preliminary-injunction request.

## Issues

1. Whether a putative/competing tender offeror has standing under Exchange Act § 13(d) to seek injunctive relief based on allegedly misleading Schedule 13D disclosures.
2. Whether the complaint plausibly alleged material misstatements or omissions in Schedule 13D filings sufficient to state a claim for injunctive relief under § 13(d).

## Decision

- The court denied Acciona’s motion to dismiss.
- The court held a tender offeror has standing to pursue injunctive relief under § 13(d).
- The court held E.ON adequately alleged material misstatements and omissions in Acciona’s § 13(d) filings at the pleading stage.
- The court reserved decision on E.ON’s preliminary-injunction motion.

## Legal Principles

- Section 13(d) (as amended by the Williams Act) serves to alert the market to large accumulations of securities that may signal a potential shift in corporate control.
- Federal courts recognize an implied private right of action for injunctive relief to enforce § 13(d)’s disclosure obligations.
- A competing tender offeror may have standing to seek injunctive relief when doing so advances § 13(d)’s investor-protection purpose by improving the accuracy and timeliness of control-related disclosures.
- On a motion to dismiss, allegations of materially misleading disclosure about financing arrangements and intentions regarding control can be sufficient to state a § 13(d) claim; disputes about intent and materiality commonly require factual development.

## Conclusion

The court allowed E.ON’s § 13(d) action to proceed, ruling that a competing tender offeror may seek injunctive relief to remedy allegedly misleading Schedule 13D disclosures, while postponing any decision on whether the requested equitable remedies should be granted.


E.ON AG v. Acciona, S.A., 468 F. Supp. 2d 537 (S.D.N.Y. 2006)