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Shareholders Directors Breach of Duty

Conyers

The Duties of Independent Directors in Amalgamations and Mergers

Conyers on

This article is the second of a three-part series analysing the decision of Justice Martin in Glendina Pty Limited & Ors v NKWE Platinum Ltd (2025) SC (Bda) 15 Civ – the first “fair value” appraisal claim under section 106...more

Wilson Sonsini Goodrich & Rosati

Officer Exculpation and the Silicon Valley 150

Effective August 1, 2022, Section 102(b)(7) of the Delaware General Corporation Law (DGCL) was amended to permit a Delaware corporation to include in its charter a provision eliminating or limiting the personal liability of...more

Allen Matkins

A Recent Reminder That Omitting This Averment May Doom A Derivative Claim

Allen Matkins on

Section 800 of the California Corporations Code applies to actions brought in the name of any domestic or foreign corporation, aka derivative actions.  It is similar, but not the same as, Delaware Court of Chancery Rule 23.1...more

Wilson Sonsini Goodrich & Rosati

In Rare Decision, Delaware Court of Chancery Imposes Liability on CEO and Acquiror Post-Trial

On March 15, 2023, Chancellor Kathaleen St. J. McCormick of the Delaware Court of Chancery issued a rare post-trial decision finding a CEO personally liable for millions of dollars in damages for breaching his fiduciary...more

Conyers

Directors’ Duties on the Precipice of Insolvency: Brief Overview of BTI 2014 LLC v Sequana SA

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The United Kingdom Supreme Court (the “UKSC”) recently delivered its eagerly anticipated judgment in BTI 2014 LLC v Sequana SA and others [2022 UKSC 25] (“Sequana”). The reasoning in Sequana will be highly persuasive in the...more

A&O Shearman

Directors' duties in the context of dividend declarations and repayment of shareholder loans

A&O Shearman on

OP3 International Pte Ltd v Foo Kian Beng [2022] SGHC 225 is a good illustration of the approach taken by the court in considering directors’ duties when a company is in a financially parlous situation and whether a director...more

Bennett Jones LLP

Court Decision Highlights "Nominee" Director Issues

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Key Highlights - - Centerra Judge found the breaches of fiduciary duties the most egregious he had ever seen. - Nominee director principles in Centerra are relevant to directors of corporations governed by the Canada...more

Allen Matkins

A First Sighting Of Zuckerberg Decision In California

Allen Matkins on

Last year, the Delaware Supreme Court adopted a tripartite test for assessing demand futility allegations in derivative actions. United Food & Commercial Workers Union v. Zuckerberg 262 A.3d 1034 (Del. 2021). Under this...more

A&O Shearman

Delaware Court Of Chancery Applies Contemporaneous Ownership Requirement And Declines To Extend Equitable Derivative Standing

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On May 13, 2022, Chancellor Kathaleen St. J. McCormick of the Delaware Court of Chancery dismissed certain stockholder derivative claims for breaches of fiduciary duty brought against the founder-CEO and other directors of...more

Kerr Russell

Court Ruling Offers New Consideration For Corporate Officers, Directors And LLC Managers

Kerr Russell on

Managers of LLCs have similar duties to members of LLCs. A breach of these fiduciary duties can lead to a lawsuit and personal liability for directors, officers and LLC managers. ...more

Allen Matkins

California Court Of Appeal Finds Caremark To Be Too Steep A Hill For Plaintiff To Climb

Allen Matkins on

In January 2018, the media began reporting on  two security vulnerabilities affecting Intel Corporation's microprocessors - dubbed "Spectre" and "Meltdown".  Following these disclosures, Intel's stock price fell and its...more

K&L Gates LLP

Plaintiff Alleged Facts Sufficient To Support Claims Against Defendants To Survive A Motion To Dismiss

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In Chester County Employees’ Retirement Fund v. KCG Holdings, Inc. et al, C.A. No. 2017-0421-KSJM (Del. Ch. June 21, 2019), the Delaware Court of Chancery denied the defendants’ motion to dismiss claims of breach of fiduciary...more

Morris James LLP

Delaware Corporate and Commercial Case Law Year In Review – 2018

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This top ten list summarizes significant decisions of the Delaware Supreme Court and the Delaware Court of Chancery over the past calendar year 2018. The cases selected either meaningfully changed Delaware law or provided...more

K&L Gates LLP

Chancery Court Denies Dismissal of Breach of Fiduciary Duty Claims after Concluding that Stockholder Vote was Not Informed

K&L Gates LLP on

In In re Tangoe, Inc. Stockholders Litigation, C.A. No. 2017-0650-JRS (Del. Ch. Nov. 20, 2018), the Delaware Court of Chancery denied the director defendants’ motion to dismiss the stockholder plaintiffs’ claim for breach of...more

Morris James LLP

Court Of Chancery Limits Zapata Test To Properly Filed Complaint

Morris James LLP on

Busch v. Richardson, C.A. 2017-0868-AGB (November 14, 2018) - A derivative complaint that meets the demand requirements of Rule 23.1 may be subject to later dismissal at the request of a properly formed and functioning...more

Morris James LLP

Court Of Chancery Dismisses Complaint Alleging Aiding and Abetting Claim

Morris James LLP on

Tilden v. Cunningham, C.A. 2017-0837-JRS (October 26, 2018) - This is an interesting decision for many reasons. It includes a comprehensive analysis of when demand on a board is not excused, when ignoring a forum selection...more

Fox Rothschild LLP

No Damages Found In PLX Technology Stockholders Litigation Suit

Fox Rothschild LLP on

In the recent decision of In re PLX Technology, Inc. S’holders Litig., Consl. C.A. No. 9880-VCL (Del. Ch. Oct. 16, 2018), the Delaware Court of Chancery found that shareholders of PLX Technology Inc. (“PLX”), a semiconductor...more

Morris James LLP

Court of Chancery Awards Damages for Breach of a Director’s Duty of Loyalty

Morris James LLP on

Every court agrees that litigants must support their privilege claims with something other than naked assertions. But they disagree about the type of support required to justify withholding documents or testimony. ...more

Fox Rothschild LLP

Breach Of Fiduciary Duty Does Not Always Lead To Damages

Fox Rothschild LLP on

It is not uncommon for the Court of Chancery to find that a fiduciary duty was breached, but to award only nominal damages or no damages as a result of such breach. This is so because damages are not an element of a claim...more

Morris James LLP

Delaware Superior Court Upholds Coverage For Fraud Claim

Morris James LLP on

Arch Insurance Company v. Murdock, C.A. N16C-01-104 EMD CCLD (March 1, 2018) - This decision upholds coverage under a D&O policy for a claim alleging fraud by directors. This is not too surprising as the Delaware...more

Morris James LLP

Court of Chancery Explains DGCL Section 141

Morris James LLP on

Cummings v. Eden, C.A. 13007-VCS (February 20, 2018) - This decision is particularly helpful in clarifying the effect of Section 141 of the DGCL. A transaction that is passed by the vote of even a single disinterested...more

Morris James LLP

Delaware Corporate and Commercial Case Law Year In Review – 2017

Morris James LLP on

This top ten list summarizes significant decisions of the Delaware Supreme Court and the Delaware Court of Chancery over the past calendar year. Our criteria for selection are that the decision either changed the law in a...more

Kilpatrick

The Businesses Judgment Rule: Time for Conceptual Clarity

Kilpatrick on

I wager that most readers of this post misunderstand the “business judgment rule” in some important regard, regardless of years of practice experience and whether you are a transactional or litigation corporate lawyer. It is...more

Morris James LLP

Court Of Chancery Explains When Entire Fairness Applies To Option Grants And Voting Agreements

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While directors have the right to issue options, when the grant is to themselves and there are specific facts suggesting unfairness, those directors will have the burden of proving the grants were entirely fair in a...more

Blake, Cassels & Graydon LLP

Nominee Directors: Rights and Responsibilities

It is common for shareholders of both public and private companies to nominate directors to sit on the companies’ boards on their behalf. This commonly occurs when an investor is an institution, when it has the contractual...more

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