Aiding and Abetting

News & Analysis as of

Employer Required to Reimburse Employee For Medical Marijuana Treatment

The Court of Appeals of New Mexico issued a decision last week that many employers believe flies in the face of the Controlled Substances Act, 21 U.S.C. §§ 801 (“CSA”), and the Justice Department’s August 29, 2013 Memorandum....more

CMS Investment Holdings, LLC v. Castle et al., C.A. No. 9468–VCP (Del. Ch. June 23, 2015) (Parsons, VC)

In this decision, the Delaware Court of Chancery largely declined to dismiss claims for breach of a limited liability company agreement, breach of the implied covenant of good faith and fair dealing, unjust enrichment, breach...more

Dead Hand Proxy Puts Create Litigation Risk for Lenders

Why it matters - In a noteworthy decision, the Delaware Court of Chancery ruled that a lender could be held liable for aiding and abetting a breach of fiduciary duty by directors of a public company borrower by including...more

California Decision Expands Actuary’s Potential Liability Based on Aiding and Abetting Theory

The recently published California decision in Nasrawi v. Buck Consultants LLC, issued by the Court of Appeal, Sixth District, has the potential to expand an actuarial firm’s liability well beyond its current limits under...more

Proxy Puts: Consider With Caution

Directors of a Delaware corporation that enters into a financing agreement with a lender may breach their fiduciary duties if the financing agreement contains a common provision allowing the lender to accelerate and demand...more

Court Of Chancery Notes The Outer Limits Of Contract/Fiduciary Claims

There is a long line of decisions that holds when the parties set out their mutual rights and obligations in a contract, only contract law governs and a breach of fiduciary duty claim cannot also be brought....more

Bank Pays $67 Million Civil Judgment for Aiding and Abetting Customer's Ponzi Scheme

A national bank discovered it doesn't always pay to keep certain clients happy after paying a $67 million civil judgment against it for its role in helping a customer operate a Ponzi scheme that defrauded investors of $1.2...more

NC Appeals Court gives Big Win for Financial Institutions

North Carolina Court of Appeals – No Causes of Action against Financial Institutions for Aiding and Abetting Breach of Fiduciary Duty or Bank Secrecy Act Violations - While many bank employees were counting down to...more

Lee v. Pincus et al., C.A. No. 8458-CB (Del. Ch. Nov. 14, 2014) (Bouchard, C.)

In this memorandum opinion, the Court of Chancery partially granted defendants’ motion to dismiss, holding that (i) plaintiff had stated a claim for breach of fiduciary duty against the Director Defendants because it was...more

Delaware Court Provides Guidance on Acceptable Deal Protection Mechanisms and Scope of Third Party Aiding and Abetting Liability...

On November 25, 2014, the Delaware Court of Chancery issued a decision in In Re Comverge, Inc. Shareholders Litigation, which: (1) dismissed claims that the Comverge board of directors conducted a flawed sales process and...more

In re Sanchez Energy Deriv. Litig., C.A. No. 9132-VCG (Del. Ch. Nov. 25, 2014) (Glasscock, V.C.)

In this memorandum opinion, the Court of Chancery held that plaintiff stockholders failed to plead particularized facts sufficient to demonstrate demand futility and dismissed the plaintiffs’ fiduciary duty, aiding and...more

Delaware Court Decides Damages in Breach of Fiduciary Duty Aiding and Abetting Case

In March 2014, Vice Chancellor Laster of the Court of Chancery of the State of Delaware issued an opinion finding Rural/Metro Corporation’s lead financial advisor liable for aiding and abetting breaches of fiduciary duty by...more

Bridging the Week - September 2014

CFTC Sues Lawyer in Federal Court for Aiding and Abetting Clients’ Legal Violations - Jay Grossman, a Florida-based attorney, was sued by the Commodity Futures Trading Commission in a federal court in Florida for...more

Defendants Owed No Duty, But Still Liable

In Am. Master Lease Llc v. Idanta, 2014 Cal. App. LEXIS 402 (Cal. Ct. App. 2014), the Second District Court of Appeal resolved the following four questions...more

In re Rural Metro Corp. S'holders Litig., C.A. No. 6350-VCL (Del. Ch. Mar. 7, 2014) (Laster, V.C.)

In this post-trial decision, the Court of Chancery held a financial advisor liable for aiding and abetting breaches of fiduciary duty by a target board in the sale of the company. The Court concluded that the financial...more

Delaware Court Holds Investment Banker Liable for Aiding and Abetting Buyout Target Board’s Breach of Fiduciary Duty

The Delaware Chancery Court recently held a respected investment banking firm liable for aiding and abetting breaches of fiduciary duty by the target company board in connection with an allegedly flawed sale process. The...more

Financial Advisor Found Liable for Aiding and Abetting Director Breaches of Fiduciary Duties in Connection With Cash-Out Merger -...

In a 91-page post-trial decision, Chancellor Travis Laster found RBC Capital Markets LLC (“RBC”) liable for aiding and abetting breaches of fiduciary duty in connection with RBC’s role as a financial advisor in the 2011 $438...more

Delaware Court of Chancery Finds Financial Advisor Liable for Aiding and Abetting Breaches of Fiduciary Duty

In a much-anticipated, 91-page post-trial opinion issued on March 7, 2014, Vice Chancellor J. Travis Laster of the Delaware Court of Chancery held in In re Rural Metro Corporation Stockholders Litigation that the lead...more

M&A Update: The “Gatekeepers”: Delaware Court Holds Conflicted Financial Advisor Liable For Aiding And Abetting Breach Of...

Delaware courts have increasingly shined a spotlight on what they consider to be conflicts of interest for sell-side financial advisors. On March 7th, the Delaware Chancery Court hit these conflicts with a laser beam. In a...more

In the Rural/Metro Decision, Delaware Court Emphasizes Conflicts of Interest in Finding Breaches of Fiduciary Duties

Citing various conflicts of interests involving management, board members and financial advisors, Vice Chancellor Laster of the Delaware Court of Chancery found that the Board of Directors of Rural/Metro Corporation (“Rural”)...more

Financial Advisor Liable for Aiding and Abetting Buyout Target Board’s Breach of Fiduciary Duty

On March 7, the Delaware Court of Chancery published a post-trial opinion in In Re Rural Metro Corporation Stockholders Litigation (Rural Metro) finding Rural/Metro’s financial advisor RBC liable for aiding and abetting the...more

The Sell Decision: Aiding, Abetting Liability Not Added

In Sell v. Gama, the Arizona Supreme Court held that the Arizona Securities Act (the “ASA”) does not authorize a secondary liability claim for aiding and abetting another’s primary securities fraud. In so holding, the...more

Zimmerman v. Crothall, C.A. No. 6001-VCP (Del. Ch. Oct. 14, 2013) (Parsons, V.C.)

This memorandum opinion addressed several post-trial motions in a derivative action pursuant to which the plaintiff and unitholder, Zimmerman, sued nominal defendant, Adhezion Biomedical, LLC (“Adhezion”), certain of...more

New Jersey Appellate Division Holds Aider And Abettor Liability Can Be Imposed On A Supervisor For His Or Her Own Affirmative...

In Rowan v. Hartford Plaza Ltd., 2013 WL 1350095 (N.J. App. Div. Apr. 5, 2013) (unpub.), the New Jersey Appellate Division held—in an unpublished opinion—that individual supervisors are subject to “aiding and abetting”...more

Appellate Court in New Jersey Imposes a Limited Duty of Care on Texters in Connection with Personal Injury Matters

In Kubert v. Best (Superior Court of New Jersey, App. Div. Docket No. A-1128-12T4, approved for publication August 27, 2013), the court held that an individual texter who knows or has a reason to know that the recipient of...more

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