Shareholders, Derivative Suit, Appeals

Court of Appeals Again Bolsters Internal Affairs Doctrine, This Time Clipping Derivative Suits Brought on Behalf of Foreign...

Farrell Fritz, P.C. on 7/28/2025

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

Ninth Circuit Upholds Delaware-Forum Bylaw That Precludes Assertion of Federal Proxy Claim

Proskauer - Corporate Defense and Disputes on 5/16/2022

The Court of Appeals for the Ninth Circuit affirmed the dismissal of a shareholder derivative action in light of an exclusive-forum bylaw requiring assertion of derivative claims in the Delaware Court of Chancery, even though...more

Eleventh Circuit Overturns Dismissal of Cryptocurrency Ponzi Scheme Class Action Suit

Goodwin on 3/9/2022

IN THIS ISSUE - Eleventh Circuit Overturns Dismissal of Cryptocurrency Ponzi Scheme Class Action Suit; Federal Court of Appeals Dismisses Leading Fannie Mae and Freddie Mac Shareholder Lawsuits; NY Seeks Blockchain...more

Northern District of California Kicks Shareholder Derivative Suit Against Alphabet, Inc. for Failing to Allege Demand Futility

Goodwin on 8/17/2021

Northern District of California Kicks Shareholder Derivative Suit Against Alphabet, Inc. For Failing to Allege Demand Futility; Rare Securities “Holder’s Claim” Trial Results in Jury Verdict for Defendants; Delaware Court of...more

New York Appellate Court Ruling Eases Hurdle to Bringing Derivative Suits Against UK Companies in the New York Courts

Herbert Smith Freehills Kramer on 12/3/2018

On Nov. 14, 2018, a New York appellate court held that in a derivative action brought in a New York court against a company incorporated in the United Kingdom, the plaintiff need not comply with U.K. Companies Act § 261(1)...more

Court of Appeals Ruling Eases the Way for Shareholders to Bring Derivative Suits Against Cayman Islands Companies in the New York...

Herbert Smith Freehills Kramer on 12/6/2017

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

Appeal in Home Depot Data Breach Derivative Action Results in Settlement of Corporate Governance Claims

Mintz - Privacy & Cybersecurity Viewpoints on 5/2/2017

Snatching victory of a sort from the jaws of defeat, shareholders who brought a derivative action alleging that the 2014 Home Depot data breach resulted from officers’ and directors’ breaches of fiduciary duties have reached...more

Delaware Supreme Court Confirms that Dilution Claims Typically Are Derivative and Are Extinguished After a Merger

Sheppard Mullin Richter & Hampton LLP on 1/20/2017

Stockholder claims alleging wrongful dilution are typically considered to be derivative in nature. Several decisions out of Delaware, however, have created exceptions to this general rule allowing stockholders to sue...more

Navigating Derivative Lawsuits Against Mutual Funds After Northstar

Carlton Fields on 10/2/2015

The Ninth Circuit Court of Appeals this spring held that mutual fund shareholders could maintain direct claims against the fund’s trustees for breach of their common law fiduciary duties. Before Northstar v. Schwab, such...more

A Little Less Murky: The Court of Appeal Clarifies the Line Between Oppression and Derivative Actions

Bennett Jones LLP on 6/1/2015

On May 26, 2015, the Court of Appeal for Ontario released its decision in Rea et al v Wildeboer, clarifying the distinct role of derivative actions under the Ontario Business Corporations Act. The role is so distinct that the...more

Ninth Circuit Holds that Under Nevada Law, a Prior Stockholder’s Litigation of Demand Futility Precludes Another Stockholder From...

Sheppard Mullin Richter & Hampton LLP on 1/6/2015

In Arduini v. Hart, 2014 WL 7156764 (9th Cir. Dec. 17, 2014), the United States Court of Appeals for the Ninth Circuit considered whether the doctrine of issue preclusion prevents a stockholder from relitigating a prior...more

The Proper Purpose Of Discovery In Derivative Suits

Allen Matkins on 10/28/2014

A plaintiff holding less than 2000 shares files a derivative suit against a corporation’s current or former directors and officers. The trial court finds the complaint to be internally inconsistent and that regulatory...more

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