Business Court Division

News & Analysis as of

Nature of Company's Defenses Can Expand Scope of Discovery

There is no question that, in a books-and-records action, the scope of discovery is limited and such discovery is not an appropriate means of obtaining the same books and records sought in the action. In Chammas v. NavLink...more

Fraud Vitiated Special-Committee Process in Dole Merger

In a self-interested transaction between a company and its controlling stockholder, the operative standard of judicial review under Delaware law is the most rigorous: entire fairness standard of review. To obtain the least...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

Defectively Issued Stock Declared Valid After Section 205 Analysis

Corporations are operated by humans, at least until the rise of Skynet (infamous as a primary antagonist in the Terminator movie franchise). As humans are prone to err, corporate acts may also be executed in error. In 2014,...more

Chancery Dismisses Complaint for Failure to Allege Noncompliance

A principal difference between alternative entities and corporations under Delaware law is the ability in the former to modify or eliminate fiduciary duties. A Delaware court is required by statute to give effect to the...more

Should Proxy Contests Be Fair?

The current surge in stockholder activism raises the interesting question whether proxy contests should be conducted fairly. Should the protagonists only tell the truth in soliciting votes or may they act like some...more

Business Court Enjoins Enforcement Of High Interest Rate Loans Made By American Indian-Related Business

Judge Gale's opinion last week in Western Sky in State v. Western Sky Financial, LLC, 2015 NCBC 84 has a little bit of everything in it: choice of law, the U.S. Constitution, claims for usury (excessive interest rates) and...more

Business Court Awards Rule 11 Sanctions For Baseless Fiduciary Duty Claim

It is probably a good idea for a corporation to avoid making fiduciary duty claims against its employees (unless they are also officers and directors). Clients (or their lawyers) who insist on making such claims are liable...more

North Carolina Business Court Recognizes Duty to Negotiate Contracts in "Good Faith"

Until there’s a binding contract, are you free to walk away from negotiations without penalty? Not necessarily. The North Carolina Business Court recently held that in certain circumstances parties have a duty to negotiate in...more

North Carolina Business Court Revisits When Customer-Related Information is a Trade Secret

The North Carolina Business Court recently revisited the question of when a business’s customer-related information can be considered trade secrets. In Southern Fastening Systems, Inc. v. Grabber Construction Products, Inc.,...more

When You Wish Upon A (Lode)Star: NC Business Court Cuts Fees Requested By Attorneys For Class Plaintiffs

The Business Court last week knocked down a fee request of Plaintiffs' class action counsel to $500,000, from the $660,000 requested, in an Order in Nakatsukasa v. Furiex Pharmaceuticals, Inc., 2015 NCBC 68. The...more

Making Straight the Road: Case Litigation Plans as a Means of Efficiency and Predictability in the Tennessee Business Court

Tennessee’s recently-convened Davidson County Business Court will adjudicate business litigation in Nashville and may hear business cases from around the state with the consent of both parties. The Business Court’s stated...more

Don't Overplay Your Hand In The Business Court

When you last heard about London Leasing LLC v. Arcus, the Business Court had entered a default in March 2015 against two of the Defendants for what I called their "defiant and obnoxious conduct." It then seemed like...more

Business Court: High To Low Posting of ATM Debit Card Transactions Properly Disclosed By Bank

The meaning of the word "item" was the definitive factor in the Business Court's decision last week in Gay v. People's Bank, 2015 NCBC 59. The case was an attempted class action involving claims against the Bank for...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

North Carolina Business Court Rules Tax on Trust Unconstitutional

The North Carolina Business Court held North Carolina’s taxation of a trust unconstitutional in Kaestner v. North Carolina Department of Revenue. N.C. Gen. Stat. § 105-160.2 imposes a tax on the undistributed income of a...more

Commercial Division Practice Continues to Shift Towards Federal Standards with Four Proposed Rule Changes

The Commercial Division Rules are once again the subject of several proposed amendments, as detailed below. While these proposals are not as far-reaching as some of the rule changes enacted in 2014, they nonetheless raise...more

A Change in the Weather Brings More Changes to the New York Commercial Division Rules

The Commercial Division Rules are once again the subject of several proposed amendments, as detailed below. While these proposals are not as far-reaching as some of the rule changes enacted in 2014, they nonetheless raise...more

North Carolina Court Holds Statute Taxing Trust Income Unconstitutional Kimberly Rice Kaestner 1992 Family Trust v. North Carolina...

On April 23, 2015, Judge Gregory P. McGuire of the Business Court division of the Superior Court of Wake County, North Carolina, issued a decision in the matter of the Kimberly Rice Kaestner 1992 Family Trust v. North...more

An Interesting Trade Secrets Case From The Business Court

If you were unsure whether customer information held by your client -- like customer contact information, sales reports, prices and terms books, sales memos, sales training manuals, commission reports, and vendor information...more

New NC Business Court tweak in the works

A new Senate Bill making a further update to defining a mandatory complex business case for referral to the Business Court was filed and has begun to move. Senate Bill 435 sponsored by Bob Rucho and Tamara Barringer who you...more

Some Stats On The Business Court

When the North Carolina Legislature "modernized" the Business Court last year, it added a provision to the General Statutes mandating that the Director of the Administrative Office of the Courts prepare a report, twice a...more

International Arbitration Newsletter - Q1 2015

Use it or lose it: French courts reject procedural objections not raised at the earliest opportunity - The Paris Court of Appeal has issued a stark warning to litigants who fail to raise procedural objections at the...more

Singapore launches International Commercial Court

The Singapore International Commercial Court (the SICC) was officially launched on 5 January 2015 at the Opening of the Singapore Legal Year. One of the express objectives of the SICC is "to further boost Singapore's value...more

Let’s Get Down to Business: Tennessee Supreme Court Establishes Business Court Pilot Project

Following the lead of over half of the States in the union (including its neighbors Alabama, Georgia, North Carolina, and South Carolina), the Tennessee Supreme Court has created by Order of March 16, 2015 the Davidson County...more

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