News & Analysis as of

Shareholder Litigation Delaware

Morris James LLP

Chancery Finds that Class Representative Sought Excessive Incentive Award, Grants Reduced Award

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In re Santander Consumer USA Hldgs. Inc. S’holders’ Litig., C.A. No. 2022-0689-LWW (Del. Ch. Mar. 31, 2025) - This class action challenged the fairness of a buyout. The case settled on the eve of trial after years of...more

Cadwalader, Wickersham & Taft LLP

Delaware Court of Chancery Reaffirms Bar Against Discovery to Plead Demand Futility

On June 26, 2025, in In re The Boeing Co. Deriv. Litig., Vice Chancellor Morgan Zurn of the Delaware Court of Chancery ordered a stay of all discovery pending the Court’s resolution of Defendants’ motion to dismiss...more

Cadwalader, Wickersham & Taft LLP

Delaware Court of Chancery Upholds Removal of Designated Director Following Amendment to Stockholders Agreement

On August 8, 2025 in Kim, et al. v. FemtoMetrix, Inc., the Delaware Court of Chancery permitted the amendment of a stockholders agreement without the consent of an adversely impacted investor, even though both the intent and...more

Troutman Pepper Locke

Delaware Court of Chancery Confirms That Asset Sales Can Trigger Revlon Review

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In In re Dura Medic Holdings, Inc. Consolidated Litigation, the Delaware Court of Chancery held that Revlon review (i.e., the obligation of the board of directors of a Delaware corporation to seek the best price reasonably...more

Shumaker, Loop & Kendrick, LLP

Client Alert: Delaware Enacts Major Amendments to its General Corporation Law: New Safe Harbors and Limits

On March 25, 2025, Delaware Governor Matt Meyer signed into law significant amendments to the Delaware General Corporation Law (DGCL). The changes—specifically to Sections 144 and 220—introduce new safe harbor protections for...more

Cornerstone Research

Parallel Derivative Action Settlements Update: August 2025

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This page provides an update on Cornerstone Research’s analysis of settlement outcomes for parallel derivative lawsuits, in which a shareholder derivative action features the same or similar allegations as a securities class...more

Morris James LLP

Delaware Court of Chancery Refuses to Certify Interlocutory Appeal When Case Is on the Verge of Final Judgment

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In re Sears Hometown and Outlet Stores, Inc. S’holder Litig., Consol. C.A. No. 2019-0798-JTL (Del. Ch. Mar. 21, 2025) After the Court awarded damages post-trial of $.87 per share to stockholders whom the Court found had been...more

Troutman Pepper Locke

Delaware Court of Chancery Holds That the Exercise of a Midstream-Adopted Call Right Was Invalid

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In Ban v. Manheim, the Delaware Court of Chancery held that the exercise of a call right against a stockholder of a Delaware corporation was invalid under Section 202 of the Delaware General Corporation Law (DGCL) because the...more

Morris James LLP

Chancery Holds Plaintiff Failed to Allege Stockholder Vote was not Fully Informed Notwithstanding Investigation and Resignation of...

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Campanella v. Rockwell, C.A. No. 2021-1013-LWW (Del. Ch. Feb. 18, 2025) - Under the Corwin doctrine, the business judgment rule will apply when a transaction is approved by a fully informed uncoerced vote of disinterested...more

DLA Piper

Legal Shopping Spree Continues in Internal Affairs Disputes: Key Case Developments

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The first half of 2025 saw numerous developments in the strategies and counterstrategies between corporations and their stockholders in efforts to find the most favorable law and courts to decide disputes between them....more

DLA Piper

Settlement Reached in Meta Investors Suit Over Privacy Violations: Key Takeaways

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Mark Zuckerberg and other current and former Meta Platforms, Inc. (Meta) executives have reached a settlement with a group of Meta shareholders. The parties reached this settlement at the beginning of the second day of an...more

Pillsbury Winthrop Shaw Pittman LLP

Delaware Supreme Court Erects a “Formidable Obstacle” to Proving Counterparty Aiding and Abetting Liability in Merger Transactions

The In re Columbia Pipeline Group Merger Litigation decision clarifies that a buyer may not be found liable for aiding and abetting a seller-side breach of fiduciary duty unless the buyer had actual knowledge—not merely...more

WilmerHale

Delaware Forum Selection Clause Binds California Shareholders

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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

Herbert Smith Freehills Kramer

California Supreme Court Confirms General Enforceability of Delaware Court of Chancery Forum Selection Clauses

Forum selection clauses have long been a feature of commercial contracting. Since then-Chancellor Strine’s decision in Boilermakers Local 154 Ret. Fund v. Chevron Corp., Delaware corporations have routinely included such...more

Snell & Wilmer

California Supreme Court Resolves Long-Running Dispute Over Delaware Forum Selection Clauses

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In a closely watched decision issued on July 21, 2025, the California Supreme Court, in EpicentRx, Inc. v. Superior Court, held that a forum selection clause requiring shareholder lawsuits to be brought in the Delaware Court...more

Sheppard Mullin Richter & Hampton LLP

California Supreme Court Holds That Lack of Jury Trial Right Is Insufficient to Reject Enforcement of Forum Selection Clause

In EpicentRx, Inc. v. Superior Court, Case No. S282521, 2025 WL 2027272 (Cal. July 21, 2025), the California Supreme Court held that forum selection clauses may be enforced against California plaintiffs even when the selected...more

Kennedys

Delaware Court of Chancery forum selection clause found enforceable by California Supreme Court, despite depriving plaintiff the...

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Delaware corporations headquartered in California can now successfully move to dismiss investor suits filed in California when the corporations’ governing documents contain forum selection clauses mandating the Delaware Court...more

Fenwick & West LLP

California Supreme Court Upholds Delaware Forum Selection Clause

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On July 21, 2025, the California Supreme Court issued an opinion in EpicentRx, Inc. v. Superior Court of San Diego County, overturning the lower courts’ decision to decline enforcement of a forum selection clause requiring...more

Stinson - Corporate & Securities Law Blog

Chancery Dismisses Three-Pronged Breach of Fiduciary Claims

The Delaware Court of Chancery dismissed three claims in Ritchie v. Baker (6/25). Broadly speaking, the plaintiff failed to adequately plead demand futility under Court of Chancery Rule 23.1 because the complaint did not...more

Skadden, Arps, Slate, Meagher & Flom LLP

Where’s the Beef? Delaware Courts Nix Unripe Challenges to Advance Notice Bylaws and Uphold Bylaws Adopted ‘on a Clear Day’

Almost overnight, generative artificial intelligence (GenAI) has become ubiquitous in numerous aspects of life, both personal and work-related. Nearly all major law firms have begun to explore and, in many instances, have...more

Morris James LLP

Chancery Finds Plaintiffs Did Not Plead Demand Futility in a Derivative Suit Challenging a Controlling Stockholder’s Equity Grant

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In re Trade Desk, Inc. Deriv. Litig., Consol. C.A. No. 2022-0461-PAF (Del. Ch. Feb. 14, 2025) - In this decision, the Court of Chancery found that stockholders challenging a controlling stockholder’s equity compensation...more

Cadwalader, Wickersham & Taft LLP

No Need to Pile On: Delaware Court of Chancery Rejects LLC Books and Records Demand After Unitholder’s Months-Long Investigation

In a recent decision, Thomas J. Scaramellino v. Arencibia Holdco, LLC, the Delaware Court of Chancery refused to allow the unitholder of a Delaware LLC to access “informal” LLC books and records—email, text messages, Slack,...more

Cooley LLP

Derivative Plaintiffs Cannot Obtain Discovery to Plead Demand Futility, According to Chancery Court

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When a company experiences an adverse event, it and its directors and officers are often subject to multiple shareholder lawsuits and demands. These matters proceed on different timelines, creating scenarios in which...more

Goodwin

Shareholder Access to Privileged Documents: Views From England and the United States

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In England and the United States, legal professional privilege or attorney-client privilege is considered fundamental to the administration of justice, allowing clients to make confidential, full, and frank disclosure to...more

Herbert Smith Freehills Kramer

Delaware Supreme Court reverses acquirer’s aiding and abetting liability, setting high bar, following precedent set by its recent...

On June 17, 2025, the Delaware Supreme Court (Court), sitting en banc, reversed a Court of Chancery ruling that had held a bidder liable for aiding and abetting fiduciary breaches of the target’s management....more

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