what s the legal precedent for poison pills 
in delaware where many large listed companies are incorporated the courts have held that corporate boards have broad discretion in preventing the accumulation of controlling stakes provided their response is proportional and based on a reasonable perception of a threat 25the bottom linepoison pills are provisions companies include in their stock issuances that prevent anyone from gaining a controlling stake they usually have share ownership thresholds set that trigger the issue of more shares to stockholders for a discount or for free thus poison pills reduce a would be acquirer s stake in a company forcing them to negotiate with the board for ownership rather than forcing their way in through stock ownership 