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The California Supreme Court handed a major victory to Delaware corporations facing shareholder litigation in California courts but left open questions about how durable the success will be. In EpicentRX v. Superior Court...more
Last month in Bullock v. Rivian Automotive, California’s Fourth District Court of Appeal became the latest to enforce a federal forum provision (FFP) embedded in a Delaware corporation’s charter and affirmed dismissal of a...more
Ten years ago, I questioned in this space whether a Delaware forum selection charter provision would survive constitutional scrutiny if it involved a de facto waiver of a jury trial...more
In Lee v. Fisher, 34 F.4th 777 (9th Cir. 2022), the Ninth Circuit affirmed the dismissal of a shareholder derivative suit against The Gap Inc. (Gap), alleging violations of Section 14(a) of the Securities Exchange Act of...more
S’holders Rep. Serv. LLC v. DC Capital Partners Fund II, L.P., C.A. No. 2021-0465-KSJM (Del. Ch. Feb. 14, 2022) - While the Court of Chancery has exclusive subject matter jurisdiction over claims and remedies sounding in...more
The Seventh Circuit issued a resounding message: Delaware forum selection clauses in corporate bylaws cannot lawfully prevent a plaintiff from bringing claims under the Securities Exchange Act of 1934 (the Exchange Act or the...more
A recent Seventh Circuit decision in Seafarers Pension Plan v. Bradway may complicate defendants’ ability to use forum-selection bylaws as a basis for dismissal of derivative suits pleading claims under the Securities...more
As discussed in a previous client alert, The Boeing Company (Boeing) has faced shareholder litigation arising from the fatal crashes of two 737 MAX airplanes. In one such derivative suit filed under Section 14(a) of the...more
On September 1, 2020, the California Superior Court for San Mateo County granted Restoration Robotics, Inc. and certain individual defendants’ (collectively, “Restoration Robotics”) Motion for Reconsideration and Renewed...more
In the last two years, plaintiffs’ lawyers have increasingly been bringing lawsuits under the Securities Act of 1933 (“Securities Act”), such as claims relating to public offerings, in state rather than federal court. ...more
In Sciabacucchi v. Salzberg, No. 346, 2019, 2020 WL 1280785 (Del. Mar. 18, 2020), the Delaware Supreme Court reversed a Delaware Court of Chancery (Laster, V.C.) decision declaring invalid a federal forum selection provision...more
Today, the Supreme Court of Delaware reversed a decision of the Delaware Court of Chancery and affirmatively endorsed the enforceability of federal forum-selection provisions, in a Delaware corporation’s certificate of...more
In 2017, courts across this country were split on whether plaintiffs could assert a class action alleging claims under the Securities Act of 1933 (which provides a private right of action against issuers and others for...more
On December 19, 2018, the Delaware Chancery Court held that a business incorporated in Delaware could not use its corporate charter or bylaws to require that its shareholders bring any securities claims under the Securities...more
On December 19, 2018, The Delaware Court of Chancery held in Sciabacucchi v. Salzberg that Delaware corporations cannot use charter or bylaw provisions to mandate that claims under the Securities Act of 1933 (‘33 Act) must be...more
In March 2018, in Cyan Inc. v. Beaver County Employees Retirement Fund, SCOTUS held that state courts continue to have concurrent jurisdiction over class actions alleging only ’33 Act violations by private plaintiffs and that...more
Where does your company want to be sued? Of course, the obvious answer is “nowhere.” But in this litigious country that is not realistic. However, to a large extent, companies can chose the forum to decide claims made against...more
As we previously discussed (Should Your Board Adopt an Exclusive Forum Bylaw?, July 2013; The Future of Exclusive Forum Bylaws, November 2013), forum selection bylaws (also sometimes called exclusive forum bylaws) have become...more
When almost 98 percent of takeover transactions valued at more than $100 million result in shareholder litigation, and often such transactions are the subject of multiple lawsuits filed in multiple jurisdictions, it is no...more