Corporate & Securities Alert: Delaware Supreme Court Confirms Officers' Fiduciary Duties and Refines the Application of the Common Law Doctrine of Shareholder Ratification


The Delaware Supreme Court’s recent decision in Gantler vs. Stephens (Del. January 27, 2009) – where the Court issued a rare reversal of a Court of Chancery decision – contains several noteworthy holdings on core corporate governance principles, including “entire fairness” review of a breach of fiduciary duty claim, the fiduciary duties of corporate officers, and the applicability of the common law doctrine of shareholder ratification to corporate transactions. The case arose from a complaint challenging the decision of the board of directors of First Niles Financial, Inc. (“First Niles”) to reject a merger proposal.

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