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North Carolina Business Court Clarifies Corporate Director Duties of Care

The North Carolina Business Court recently issued a lengthy opinion discussing the duties of corporate directors. Key points include: ..Directors comply with their duty to exercise adequate oversight if the board makes a...more

Breaking: North Carolina Supreme Court Confirms that Dissenting Shareholders Are Entitled to No More than Deal Price in First...

In Reynolds American Inc. v. Third Motion Equities Master Fund Ltd., et al., 2021-NCSC-162 (Dec. 17, 2021), the Supreme Court of North Carolina unanimously affirmed the North Carolina Business Court’s 189-page decision...more

Lawyers May Simultaneously Represent a Corporation and Its Directors Against Derivative Claims That Do Not Allege “Serious...

In a case of first impression in North Carolina, a judge for the North Carolina Business Court was recently asked to decide whether a single law firm may simultaneously represent both a corporation and its individual...more

Deal Price is King in Appraisal Rights Actions in North Carolina Where Merger Process Bears “Objective Indicia of Fairness”

In the first trial of its kind in North Carolina, the North Carolina Business Court has determined the fair value of dissenters’ shares in a large, publicly-traded company under the North Carolina Appraisal Rights statute,...more

Another Tool in the Toolbox – Delaware Approves “Federal Forum Provisions” For Stockholder Securities Claims

In a closely-watched case, Salzberg v. Sciabacucchi, No. 346, 2019 (Del. Mar. 18, 2020), the Delaware Supreme Court upheld the facial validity of charter provisions requiring that stockholders bring claims arising under the...more

“Disclosure Settlements” Live On In North Carolina Merger Litigation – But Will the Fee Awards Continue to Justify Lawsuits?

The North Carolina Business Court recently approved a “disclosure settlement” of a merger challenge, suggesting that in North Carolina such settlements may remain a viable means of resolving merger lawsuits – at least where...more

The Death of Merger Litigation Part II – The North Carolina Business Court Puts a Nail in the Coffin

In a recent article entitled “The Death of Merger Litigation?”, we wrote about the Delaware Court of Chancery’s increasing refusal to approve disclosure-only settlements in shareholder lawsuits challenging public company...more

Tyranny of the Minority: North Carolina Business Court Explores Potential Fiduciary Duties of Minority Shareholders

The North Carolina Business Court recently issued an opinion considering whether a minority shareholder can ever be considered a “controlling shareholder” who owes a fiduciary duty to other shareholders. The court’s opinion...more

Exculpatory Provisions Provide Powerful Protection for Independent Directors

The Delaware Supreme Court recently issued an important decision clarifying the standards that govern claims for money damages against independent directors of corporations whose charters contain exculpatory provisions....more

North Carolina Business Court Holds Pleading Stage Too Early to Dismiss Broad Non-compete

On May 7, 2015, Judge Gregory McGuire of the North Carolina Business Court denied defendants’ motion to dismiss a claim that a physician’s assistant breached non-competition and non-solicitation provisions in her employment...more

Proposed Legislation Threatens Corporations' Ability to Select Forum

Current Delaware law permits a Delaware corporation to adopt a bylaw specifying an exclusive forum other than Delaware to litigate intra-corporate disputes, so long as there is a logical connection between the forum selected...more

If at First You Don't Succeed: Fourth Circuit Revives Securities Fraud Claims

The Fourth Circuit recently revived securities fraud claims against a pharmaceutical company, holding that the allegations that the company acted with wrongful intent were sufficient to proceed even under the heightened...more

“Frivolous” Merger Litigation Settlement Rejected by the Court

In an opinion that could help remedy the problem of baseless merger litigation, a court applying North Carolina law recently refused to approve a class action settlement because the underlying lawsuit was without merit. ...more

The Fraudulent Joinder Doctrine...It’s Not Just For Fraud Or Joinder

In Weidman v. ExxonMobil Corporation, et al., No. 13-2007 (4th Cir., January 8, 2015), the Fourth Circuit confirmed that the “fraudulent joinder” doctrine requires neither an allegation of fraud nor a situation involving a...more

Documents Speak Louder Than Words in Securities Fraud Suit

The Eastern District of North Carolina recently granted summary judgment for the defendant in a securities fraud action, holding that the plaintiff had failed to prove either scienter or reliance where alleged verbal...more

Delaware Court of Chancery Upholds North Carolina "Exclusive Forum" Bylaw

In a closely-watched case with implications for corporations across the nation, Chancellor Andre Bouchard of the Delaware Court of Chancery has issued an opinion enforcing a forum-selection bylaw that requires intra-corporate...more

Federal Court Report - Fourth Circuit Clarifies Pleading Standards and (Again) Rejects Affidavits that Contradict a Party’s...

In Stevenson v. City of Seat Pleasant, Maryland, No. 12-2047 (4th Cir. Feb. 21, 2014), the Fourth Circuit spent some time cleaning up a rather messy case involving the alleged use of excessive force by members of a police...more

Fourth Circuit Affirms Dismissal of Securities Claim Alleging Accounting Fraud

If you thought it was difficult to make a federal securities fraud claim stick in the Fourth Circuit, the court has now raised the bar even higher. The Fourth Circuit recently affirmed a trial court’s dismissal of securities...more

Federal Court Report - Fourth Circuit Denies Appeal When There are Genuine Issues of Fact on Defendants’ Immunity Defense

In an unpublished opinion, the Fourth Circuit considered the defendants’ appeal from the denial of their motion for summary judgment based on qualified immunity. Cooper v. Lippa No. 13-2055 (4th Cir. April 4, 2014). The Court...more

Federal Court Report - Sometimes it’s Just Better to Leave “Well-Enough” Alone

In Sisk v. Abbott Laboratories, — F.R.D. –, No. 1:11-cv-159 (W.D.N.C. Feb. 10, 2014) (J., Reidinger), after prevailing in part on its motion for summary judgment, the defendant asked the court for the Western District to...more

North Carolina Court of Appeals Upholds Arbitration Clauses in Consumer Agreements

The North Carolina Court of Appeals has recently enforced arbitration clauses in short-term “payday” loan contracts, requiring the borrowers to bring their claims in arbitration rather than in court. In doing so, the Court...more

North Carolina Business Court Limits Unfair and Deceptive Trade Practice Claims Concerning Internal Corporate Matters

On January 28, 2014, the North Carolina Business Court dismissed an unfair and deceptive trade practice claim alleging that corporate directors structured the sale of a corporation in a manner that shortchanged its common...more

Members of Nonprofit Corporations Can Bring Derivative Actions – But They May Have to Pay a Price

A recent decision by the North Carolina Court of Appeals serves as a reminder to North Carolina nonprofit corporations that their members can bring derivative actions on behalf of the nonprofit. But, if such actions are...more

Federal Court Report - Fourth Circuit Applies “Nerve Center” Test for Diversity Jurisdiction

On January 7, 2014, the Fourth Circuit applied the “nerve center” test for determining a corporation’s principal place of business for diversity jurisdiction. The Supreme Court recently adopted the nerve center test in Hertz...more

North Carolina Supreme Court Addresses Duties of Corporate Directors

On November 8, 2013, the North Carolina Supreme Court issued a rare opinion addressing the duties of corporate directors and reaffirming that those duties are generally owed only to the corporation itself rather than the...more

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