News & Analysis as of

Shareholders Fiduciary Duty Board of Directors

Vinson & Elkins LLP

Delaware Court of Chancery Rejects Challenges to Sale of Company by Private Equity Controller, Assesses Transaction Under Business...

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On January 7, 2025, Vice Chancellor Glasscock issued a 68-page post-trial decision in Manti Holdings, LLC v. The Carlyle Group Inc., in which he rejected plaintiffs’ claims of breach of fiduciary duty in connection with the...more

Farrell Fritz, P.C.

Can a Shareholder Be Oppressed After Ceding Control? Oppression, Reasonable Expectations, and Contractual Formalism

Farrell Fritz, P.C. on

One of the first business divorce cases that I participated in as a young litigator was a lengthy arbitration over whether a minority shareholder was oppressed under BCL 1104-a.  With those fond memories, evolution of the...more

Perkins Coie

BlackRock’s US Proxy Voting Guidelines Updates

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BlackRock recently published its updated “Proxy Voting Guidelines for Benchmark Policies - U.S. Securities” for the 2025 proxy season, along with its 2025 “Global Principles for Benchmark Policies” and “Engagement Priorities...more

Morris James LLP

Chancery Decision Provides Instructive Guidance on Referencing Private Agreements in Corporate Charters and Bylaws

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Seavitt v. N-able, Inc., C.A. No. 2023-0326-JTL (Del. Ch. July 25, 2024) - Earlier this year, the Court of Chancery in West Palm Beach Firefighters’ Pension Fund v. Moelis (“Moelis”) invalidated a stockholders’ agreement...more

Allen Matkins

FDIC Plans To Sue Silicon Valley Bank And Holding Company Directors And Managers

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Last week Kevin M. LaCroix reported that the Board of Directors of the Federal Deposit Insurance Corporation had voted unanimously to approve the staff’s request for authorization to file a suit against six former officers...more

Morris James LLP

Chancery Finds that Would-Be Caremark Plaintiffs Failed to Plead Demand Futility

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Bricklayers Pension Fund of W. Pa. v. Brinkley, C.A. No. 2022-1118-MTZ (Del. Ch. July 12, 2024) - In derivative cases where a stockholder-plaintiff has not made a pre-suit demand on the board of directors, demand futility...more

Morris James LLP

Chancery Holds That Demand Was Not Wrongfully Refused When Considered by Working Group

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In re Kraft Heinz Demand Refused Derivative Stockholder Litig., Consol. C.A. No. 2022-0398-LWW (Del. Ch. July 19, 2024) - By making a demand, a stockholder-plaintiff tacitly concedes that the board can impartially consider...more

Kramer Levin Naftalis & Frankel LLP

Delaware Supreme Court Affirms Breach of Fiduciary Duty Judgment Against CEO but Reverses Bidder’s Aiding and Abetting Liability

In a recent decision by the Delaware Supreme Court sitting en banc in In re Mindbody, Inc., Stockholder Litigation, the court affirmed the Court of Chancery’s determination that Mindbody’s CEO had breached his duties of...more

A&O Shearman

Delaware Court Of Chancery Holds Stockholder Vote Following Post-Trial Decision Cannot Retroactively Ratify A Transaction That...

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As we previously reported, in January 2024, the Court held in a stockholder derivative suit against the CEO and directors of a sustainable energy and electric vehicle company (the “Company”) that a record-setting $55.8...more

Allen Matkins

Court Rules That When Profits Are Hypothetical There Can Be No Civil Theft

Allen Matkins on

Under California Penal Code Section 496(a) a person who buys or receives any property that has been stolen or that has been obtained in any manner constituting theft or extortion, knowing the property to be so stolen or...more

Hogan Lovells

Q2 2024 Quarterly Corporate / M&A decisions updates

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Below is our Corporate / M&A decisions update covering decisions in the second quarter of 2024. Decisions from the Delaware Court of Chancery this quarter included further development of the jurisprudence around the validity...more

Orrick, Herrington & Sutcliffe LLP

OLNS#12 – Advisory Boards in German Start-ups

In substantially all of the major world markets, we have dedicated technology lawyers who support young German technology companies on their growth trajectory through all stages. As one of the top tech law firms in the world,...more

Orrick, Herrington & Sutcliffe LLP

OLNS#12 - Beiräte in deutschen Start-ups

Mit unseren auf Technologietransaktionen spezialisierten Teams in allen wichtigen globalen Märkten begleiten wir zahlreiche deutsche Technologieunternehmen auf ihrem Wachstumspfad. Als eine der führenden Tech-Kanzleien...more

Bricker Graydon LLP

Navigating ESOP Transactions: Essential Steps to Minimize DOL Scrutiny from the Start

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In a recent court ruling, the US Department of Labor (DOL) prevailed against corporate directors and shareholders for claims related to an Employee Stock Ownership Plan (ESOP) transaction. ...more

Allen Matkins

When Dismissing A Case Violates Due Process

Allen Matkins on

When a shareholder sues derivatively, the shareholder is seeking relief not for itself, but for the corporation.  Therefore, it should be expected that the shareholder is not free to compromise or dismiss the suit absent...more

Morris James LLP

Court of Chancery Rejects ‘Caremark’ Liability for Imperfect Compliance With Legal Obligations

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Delaware corporations are not permitted to pursue profits by violating the law. Under Caremark and its progeny, directors’ fiduciary duties include the good faith obligation to oversee and monitor the corporation’s compliance...more

Allen Matkins

Just What Are The Duties Of A Controlling Shareholder And How Should Claims Of Breach Be Brought?

Allen Matkins on

In a recent post, Professor Stephen Bainbridge discusses the question of when a controlling shareholder owes fiduciary duties to minority shareholders.  Knowing when controlling shareholder owes fiduciary duties is one thing,...more

Davies Ward Phillips & Vineberg LLP

Governance Insights: Nominee Directors – Fiduciary Obligations and the Limits of Information Sharing

The corporate life of a nominee director has been characterized as having the potential to be “neither happy nor long.” In this Governance Insights article, we discuss the fundamental fiduciary considerations that nominee...more

Woodruff Sawyer

Large Derivative Suit Settlements and Your Side A D&O Insurance

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Traditionally, this has been the main type of derivative suit that has resulted in large settlements. Merger and acquisition cases are common here. Examples of these types of suits include Paramount Global (CBS-Viacom merger)...more

Hogan Lovells

In re Cognizant Technology: Third Circuit adopts de novo review for failure to plead demand futility

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In re Cognizant Technology Solutions Corporation Derivative Litigation, the United States Court of Appeals for the Third Circuit, sitting en banc, overruled its prior decision in Blasband v. Rales that applied an...more

Allen Matkins

Is Your Directors And Officers Liability Coverage Illusory?

Allen Matkins on

Many corporations pay significant amounts for directors and officers liability policies.  Commonly referred to as D&O policies, these policies usually involve three sides.  Directors and officers are likely to have the most...more

Morris James LLP

Chancery Holds Plaintiff Fails to Meet Rule 23.1 Pleading Standard, Dismisses Action Arising From T-Mobile Data Hack

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Harper v. Sievert, C.A. No. 2022-0819-SG (Del. Ch. May 31, 2024). A stockholder plaintiff brought derivative claims alleging that current and former directors of T-Mobile US, Inc. were liable for aggregating customers’...more

Morris James LLP

Delaware Supreme Court Reverses MFW Dismissal Due to Inadequate Disclosures Regarding Special Committee’s Advisors’ Material...

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City of Sarasota Firefighters’ Pension Fund v. Inovalon Holdings Inc., No. 305, 2023 (Del. May 1, 2024). The Delaware Supreme Court’s decision in Khan v. M & F Worldwide Corp. (“MFW”) established a cleansing process for a...more

ArentFox Schiff

How Can Our Board Work Better? A Brief, Practical Guide to Legal Considerations for Trade Association Board Governance

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Trade association boards, like the boards of other private companies, often consist of stakeholders who are personally and professionally invested in the organization. Board members typically also possess significant business...more

Morris James LLP

Chancery Addresses Acquirer’s Request For Joint Tortfeasor Settlement Credit

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In re Columbia Pipeline Grp. Inc. Merger Litig., Consol. C.A. No. 2018-0484-JTL (Del. Ch. May 15, 2024) - In this post-trial decision, the Court addressed an acquirer’s responsibility for damages suffered by a stockholder...more

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