News & Analysis as of

Corporate Governance Motion to Dismiss

Dechert LLP

After Delaware Court of Chancery Subjects Reincorporation Decision to Entire Fairness, Delaware Supreme Court Says Not so Fast

Dechert LLP on

The Delaware Court of Chancery issued an order in Palkon v. Maffei on February 20, 2024, holding that a decision by the boards of directors and the controller of TripAdvisor, Inc. (“TripAdvisor”) and Liberty TripAdvisor...more

ArentFox Schiff

Airline 401k Decision Illustrates Continued Takeoff of ESG Litigation

ArentFox Schiff on

A Texas federal judge recently permitted an environmental, social, and governance- (ESG) related Employee Retirement Income Security Act (ERISA) case filed by an airline pilot against his employer and its benefits plan to...more

Allen Matkins

Nevada Supreme Court Finds CEO's Statements To Shareholders, Directors And Officers May Be Protected Activity

Allen Matkins on

Nevada, like California, has enacted an anti-SLAPP law that is intended to protect citizens' First Amendment rights to petition the government for redress of grievances and to free speech by limiting the chilling effect of...more

Skadden, Arps, Slate, Meagher & Flom LLP

The Court of Chancery Holds That Corporate Officers, Like Directors, Owe a Duty of Oversight

On January 25, 2023, Vice Chancellor Laster of the Court of Chancery issued a significant decision, finding as a matter of first impression that corporate officers owe a duty of oversight akin to the oversight duties owed by...more

Patton Sullivan Brodehl LLP

The “DAO Jungle” Chronicles: Federal Court Allows DAO to be Sued as a Partnership

In a prior post — The DAO Jungle? — we recapped the State of Wyoming’s new legislation extending LLC protections to Decentralized Autonomous Organizations (DAOs). Under that Wyoming law, a DAO could register as a LLC and its...more

Mintz - Securities & Capital Markets...

Caremark Liability Following the SEC’s New ESG Reporting Requirements

Recent developments in the Court of Chancery concerning a corporate board’s duty to monitor and provide oversight over a corporation’s operations, so-called Caremark claims, are likely to intersect with the Securities and...more

Skadden, Arps, Slate, Meagher & Flom LLP

‘Mission Critical’ Issues and ‘Red Flags’: What It Means for a Board To Exercise Oversight

Takeaways - Delaware courts have become more willing to allow stockholders to pursue claims that directors breached their duty to oversee risk management and compliance. Directors are most vulnerable to suits where they have...more

Woodruff Sawyer

Securities Class Action Trends for Life Sciences, 2021: REPORT

Woodruff Sawyer on

Insights Priya Cherian Huskins, Esq.Senior Vice President, Management LiabilityEditor, Management Liability/D&O May 10, 2022 /Management Liability/D&O While the life sciences sector has experienced a slowdown in IPO activity...more

Proskauer - Corporate Defense and Disputes

Cisco Diversity Suit Dismissed

Another shareholder derivative suit claiming diversity shortcomings within the company was dismissed last week: A judge in the Northern District of California dismissed allegations that Cisco Systems Inc. falsely and...more

Kramer Levin Naftalis & Frankel LLP

District Court Denies Motion to Dismiss SEC’s First ‘Shadow Trading’ Complaint

Judge William H. Orrick of the Northern District of California recently denied a motion to dismiss the Securities and Exchange Commission’s (SEC’s) first insider trading case charging a defendant with “shadow trading.” The...more

Jones Day

Recent Developments in Shareholder Derivative Litigation Concerning Diversity in Corporate Leadership

Jones Day on

The Situation: A number of shareholder derivative lawsuits in federal court have been filed seeking to hold directors and officers of major companies accountable for alleged failures to uphold their companies' stated...more

Dorsey & Whitney LLP

The Importance of Full Disclosure

Dorsey & Whitney LLP on

Directors and officers of corporations owe a duty of care and a duty of loyalty to both the corporation and its shareholders, although the duty of care for directors can be exculpated. A breach of these fiduciary duties can...more

WilmerHale

Private Equity Firms, the Healthcare Industry, and the FCA: The “Butterfly Effect” in Action?

WilmerHale on

When Riordan, Lewis & Haden Inc. (RLH), a private equity firm, found itself ensnared in a False Claims Act (FCA) litigation for its role in a prescription drug kickback scheme orchestrated by one of its portfolio companies,...more

Faegre Drinker Biddle & Reath LLP

A Director’s Mission: Understanding, Monitoring and Accurately Reporting Mission Critical Operations

On October 1, 2019, the Court of Chancery rendered an opinion in In re Clovis Oncology, Inc. Derivative Litigation, denying a motion to dismiss a Caremark claim for breach of fiduciary duty and reinforcing a director’s duty...more

Mintz - Employment Viewpoints

Delaware Court Of Chancery Reaffirms Entire Fairness Standard In Director Compensation

On May 31, 2019, in Stein v. Blankfein, et. al., the Delaware Court of Chancery reaffirmed the Delaware Supreme Court’s holding in In re: Investors Bancorp, Inc. Stockholder Litigation that the “entire fairness” standard...more

Proskauer Rose LLP

Delaware Supreme Court Confirms Preclusive Effect of Dismissal of Derivative Actions Based on Lack of Demand Futility

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The Delaware Supreme Court held yesterday that the dismissal of a shareholder derivative action for lack of demand futility can preclude other derivative actions as long as the plaintiff in the dismissed case adequately...more

Proskauer - Corporate Defense and Disputes

Southern District of Florida Case Challenging Bylaw Requiring Minimum Stake to Sue Dismissed

As we have previously discussed, there has been a growing trend of corporations’ adopting various types of bylaws to define the bounds of shareholder litigation. These include forum-selection bylaws and fee-shifting bylaws...more

Allen Matkins

No Calm In Delaware After Calma v. Templeton

Allen Matkins on

In derivative suits, cases are essentially lost and won at the motion to dismiss stage.  Unless the defendants succeed in winning dismissal, they must confront an unhappy choice between continued litigation with all of its...more

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