Bylaws

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Fee-Shifting Corporate Bylaws: What's the Law in Maryland?

In May 2014, the Supreme Court of Delaware held that a non-stock corporation could enact bylaws that could force a shareholder to pay the corporation’s legal fees, costs, and expenses if the shareholder sues the corporation...more

The Ropes Recap: Mergers & Acquisitions Law News - October 2014

In this issue: - Delaware Legislative Update - Amendments to DGCL Effective August 1, 2014 - News from the Courts - Additional Guidance on Kahn v. M&F Worldwide Corp. - Exculpation...more

If Bylaws Are Contracts, Where’s The Boilerplate?

Bylaws hardly constitute literature. For the most part, they simply regurgitate the applicable general corporation law with a few permitted changes here and there. In general, there seems to be two schools of thought when...more

Can An Employment Agreement Be A Wee Bit Too Integrated?

The Bylaws of many public companies provide for mandatory indemnification of directors and officers (and sometimes other agents as well). Often, Bylaws describe these indemnity obligations as contract rights. For example...more

Forum Selection Clauses Were Here Before They Were In Bylaws

Recent rulings by judges in Delaware and other states have given impetus to the adoption of exclusive forum bylaws. To the casual observer, the idea might seem entirely novel. But as Koheleth (the Gatherer) wrote “What has...more

Blog: Will The SEC Intercede In The Battle Over Fee-Shifting Bylaws?

“The first trickle through a leak in the dam” that eventually causes the dam to collapse is how Professor John Coffee characterized the adoption of fee-shifting bylaw or charter provisions by 24 companies since May of this...more

Delaware Fee-Shifting Bylaws Update

As previously discussed, the Delaware legislature postponed, until it reconvenes in 2015, its consideration of legislation aimed at limiting enforceability of fee-shifting bylaw provisions to non-stock corporations. Despite...more

Recent Decisions Confirm That Forum Selection Bylaws Are Best Considered on a Clear Day - But May Be Beneficial Later as Well

“Exclusive forum” bylaws and charter provisions are a powerful tool for managing the risk of parallel corporate governance litigation against a company and its directors in multiple forums, allowing stockholders to bring such...more

ISS Publishes Results of Annual Global Voting Policy Survey

On September 29, Institutional Shareholder Services (ISS), a leading proxy advisory firm, published the results of its 2014–2015 global voting policy survey. The survey, which, according to ISS, received more than 370...more

Forum Selection Bylaws Gain Ground

As we previously discussed (Should Your Board Adopt an Exclusive Forum Bylaw?, July 2013; The Future of Exclusive Forum Bylaws, November 2013), forum selection bylaws (also sometimes called exclusive forum bylaws) have become...more

Oklahoma Takes a Stand a Stand in the Battle Over Derivative Fee-Shifting

Back in May we discussed ATP Tour, Inc. v. Deutscher Tennis Bund a seminal Delaware Supreme Court case that upheld a non-stock corporation’s “loser pays” fee-shifting bylaw. ATP Tour held that where a Delaware corporation...more

Delaware Court Approves Out-Of-State Forum Selection Bylaw Adopted At Time Of Merger

In City of Providence v. First Citizens BancShares Inc. et al., C.A. No. 9795-CB (Del. Ch. Sept. 8, 2014), the Delaware Court of Chancery (Bouchard, C.) held that a minority shareholder's claims against a Delaware...more

Charged with Interpreting “Officer” in Corporate By-Laws, Third Circuit Decides 12 Random People Are Better Suited for the Job

Here are two things I thought when I was a kid: (1) Quicksand was a real threat, something that could suck me into the Earth if I wasn’t careful when walking around outside. I don’t know if this was a function of too many...more

Delaware Court of Chancery Reaffirms Enforceability of Forum Selection Bylaws

In City of Providence v. First Citizens BancShares, Inc. (Del. Ch. September 8, 2014), the Delaware Court of Chancery upheld a forum selection bylaw that designated North Carolina as the exclusive forum for certain...more

Delaware Chancery Court Upholds Bylaw Creating Exclusive Forum Outside Of Delaware For Disputes

On September 8, the Court of Chancery of the State of Delaware upheld a bylaw of a Delaware corporation that designated an exclusive forum other than Delaware for resolution of actions against the company and its directors....more

City of Providence v. First Citizens BancShares, Inc., C.A. No. 9795-CB (Del. Ch. Sept. 4, 2014) (Bouchard, C.)

In this consolidated opinion concerning the validity of a forum selection bylaw, the Court of Chancery affirmatively answered, among other things, an issue of first impression: “whether the board of a Delaware corporation may...more

SEC Advisory Committee To Consider Fee-Shifting Bylaws, But Why?

One agenda item for the upcoming meeting of the Investor Advisory Committee is a “Discussion of Issuer Adoption of Fee-Shifting Bylaws for Intra-Corporate Litigation”. This is indeed an interesting and timely topic in light...more

Delaware Court Enforces Exclusive Forum Provision Adopted Concurrently with Announcement of Merger Agreement

Public companies are increasingly enacting “exclusive forum” bylaws — designating a single forum for intra-corporate disputes — as a way to limit the risk and burden of multi-jurisdictional stockholder litigation. This trend...more

Forum Selection Bylaws Are Best Considered On A Clear Day

“Exclusive forum” bylaws and charter provisions are a powerful tool for managing the risk of parallel corporate governance litigation against a company and its directors in multiple forums, allowing stockholders to bring such...more

No Delaware Court Decision Re Fee-Shifting Bylaw On An As-Applied Basis

It now appears that the Delaware court will not address the as-applied validity of a fee-shifting bylaw in the case involving Hemispherx. (As discussed in this post and this Cooley Alert, the Delaware Supreme has already...more

Inside The Courts - September 2014 | Volume 6 | Issue 3

In This Issue: - CLASS CERTIFICATION: ..Goodman v. Genworth Fin. Wealth Mgmt. Inc., No. 09-CV-5603, 2014 WL 1452048 (JFB) (GRB) (E.D.N.Y. Apr. 15, 2014) - DEMAND FUTILITY: ..Rosenbloom v. Pyott,...more

Forum Selection Bylaws–More Good News

Fending off merger-related shareholder lawsuits keeps getting easier. Just a week ago, the Delaware Chancery Court upheld the enforceability of the bylaw of a Delaware corporation headquartered in North Carolina that selected...more

Bylaw of Delaware Corporation Providing for Exclusive Forum in North Carolina Upheld

In City of Providence v. First Citizens Bancshares, Inc., C.A. No. 9795 (Del. Ch. Sep. 8, 2014), Delaware Chancellor Bouchard upheld a bylaw adopted by the board of directors of a corporation incorporated in Delaware...more

The Delaware Court Of Chancery Can See Forever On A Clear Day (Even To North Carolina)

I don't usually write about decisions from the Delaware Court of Chancery because it's rare for that Court to even mention North Carolina. But a decision by that Court this week -- in City of Providence v. First Citizens...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

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