AB and Inbev question?

Question

How is it legal for a company to file a lawsuit and threaten to fire every member of the board of directors and then replace them with their own handpicked board? How is this legal in any way shape or form?

Answer 1

First of all, never be surprised by any lawsuit being filed, regardless of how absurd you may think it is.  Anyone can file a lawsuit over anything, it doesn't mean they'll win obviously.

That being said, within the Articles of Incorporation are rules for the Board of Directors (BoD).  If the corporation thinks the BoD has acted against their contract at any time, they can file a lawsuit to get them removed for breach of contract.  In a nutshell that's what AB is trying to do here.  I'm not familiar enough with the details of this case to guess whether AB will be successful, but that is the grounds of their suit.

Hope this helps.