Section 626 of New York’s Business Corporation Law governs standing to sue derivatively in New York. It states that “an action may be brought in the right of a domestic or foreign corporation . . . by a holder of shares or...more
In Ezrasons, Inc. v. Rudd, 2025 NY Slip Op. 03008, 2025 N.Y. LEXIS 717 (N.Y. May 20, 2025), the New York Court of Appeals reaffirmed the fundamental and controlling nature of the internal affairs doctrine as it relates to the...more
On May 20, 2025, the New York Court of Appeals affirmed the dismissal of a derivative action asserting claims for breach of fiduciary duty against officers and directors of a corporation incorporated under the laws of England...more
It is sometimes said that California Corporations Code section 2116 "codifies" the internal affairs doctrine. See, e.g., Drulias v. 1st Century Bancshares, Inc., 30 Cal. App. 5th 696, 705, 241 Cal. Rptr. 3d 843, 851...more
As a voice crying in the wilderness, I have for many years proclaimed that the internal affairs doctrine is not as all-encompassing as Delaware and its devotees would like to believe. The limitations on the internal affairs...more
In this recent post, UCLA Law School Professor Stephen Bainbridge discusses Vice Chancellor J. Travis Laster's recent ruling that "stockholder inspection rights are a core matter of internal corporate affairs." 2020 Del....more
California, unlike the federal government, has codified its prohibition on insider trading. Corporations Code Section 25402 provides...more
In Sciabacucchi v. Salzberg, C.A. No. 2017-0931-JTL (Del. Ch. Dec. 19, 2018), the Delaware Court of Chancery invalidated provisions in the certificates of incorporation of three Delaware corporations — Blue Apron Holdings...more
On Nov. 20, 2017, the New York Court of Appeals held that in a derivative action brought in a New York court against a company incorporated in the Cayman Islands, the plaintiff need not comply with Rule 12A of the Cayman...more
As I have mentioned on numerous occasions, California has its own insider trading statute – California Corporations Code Section 25402. The statute is included in the California Corporate Securities Law of 1968. In general,...more
A veil piercing claim can be a worst-case scenario for a private fund manager dealing with a struggling portfolio company investment – the company fails, and ensuing legal claims are brought not only against the portfolio...more
A recent decision in the Delaware Supreme Court, in conjunction with the broad California exceptions to the internal affairs doctrine, may dictate the legal landscape of shareholder litigation in California in the near...more
Books-and-records litigation does not typically grab headlines. In fact, few cases litigated under Section 220 of the Delaware General Corporation Law result in written opinions authored by the Delaware Supreme Court. ...more
In March, Safeway and Albertsons announced that they had entered into a definitive merger agreement. As night follows day, litigation ensued. At least 12 class action complaints were filed by alleged stockholders of...more