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Chancery Largely Denies Books-and-Records Inspection Exploring Dividend Potential

Greenlight Capital Offshore Partners, LTD., v. Brighthouse Financial Inc., C.A. No. 2022-1067-LWW (Del. Ch. Nov. 20, 2023) - Valuation is a well-established proper purpose to inspect corporate books and records. While each...more

Chancery Limits Section 220 Books-and-Records Production to Formal Board Materials

In re Zendesk, Inc. Section 220 Litigation, C.A. No. 2023-0454-BWD (Del. Ch. Aug. 25, 2023) - The background of this books-and-records decision involved a failed acquisition, a strategic review, a proxy contest, and a...more

Plaintiff Overcomes Rule 23.1 In Walmart Opioids Litigation Based In Part On Over-Redacted Documents In Books And Records...

Ontario Provincial Council of Carpenters’ Pension Trust Fund v. Walton, C.A. No. 2021-0827-JTL (Del. Ch. Apr. 26, 2023) - To assert a derivative claim, a stockholder plaintiff must plead demand futility. The plaintiffs...more

Chancery Denies Books and Records Inspection Brought to Advance the Stockholder’s Interests as a Creditor

Georgia Notes 18, LLC v. Net Element, Inc., C.A. No. 2021-0246-JRS (Del. Ch. Nov. 18, 2021) - Plaintiff, a stockholder and creditor of the defendant company, demanded to inspect the company’s books and records pursuant to...more

Chancery Grants Inspection Demand Relying on a Short-Seller’s Report

Jacob v. Bloom Energy Corp., C.A. No. 2020-0023-JRS (Del. Ch. Feb. 25, 2021) - In a post-trial opinion in this books-and-records action pursuant to 8 Del. C. § 220, the Court of Chancery granted a stockholder’s demand to...more

Delaware Corporate and Commercial Case Law Year in Review: 2020

This top ten list summarizes significant decisions of the Delaware Supreme Court and the Delaware Court of Chancery over the past calendar year. Our criteria for selection are that the decision either meaningfully changed...more

Chancery Modifies Confidentiality Order to Permit Assertion of Plenary Claims in Appraisal Action

Harris v. Harris FRC Corp., C.A. No. 2019-0736-JTL (Del. Ch. Jan. 7, 2021) - Under Rule 5.1, the Court of Chancery may enter a confidentiality order upon a showing of good cause that such an order is necessary to protect...more

Mindbody Deal Case Provides Conflict Takeaways For Boards

The Delaware Court of Chancery's recent decision in In re: Mindbody Inc. Stockholders Litigation is important reading for lawyers whose practices include evaluating, addressing and — when necessary — litigating potential...more

Chancery Addresses Burdens for Valuation-Related Books-and-Records Inspections, While Finding Defendant’s Asserted Lack of Records...

Woods v. Sahara Enterprises, Inc., C.A. No. 2020-0153-JTL (Del. Ch. July 22, 2020) - This decision concerning statutory inspection rights under Section 220 of the Delaware General Corporation Law clarifies the requirements...more

Chancery Rejects Challenge to Delaware as Proper Venue in Books and Records Action

Stanco v. Rallye Motors Holding, LLC, C.A. No. 2019-0751-SG (Del. Ch. Dec. 23, 2019). Delaware courts generally respect contractual forum selection provisions. When it comes to Delaware LLCs, however, the Delaware statute...more

Chancery Declines to Establish New Rule Concerning Books and Records Inspections Related to Proxy Contests

High River Limited Partnership v. Occidental Petroleum Corp., C.A. No. 2019-0403-JRS (Del. Ch. Nov. 14, 2019). Section 220 of the DGCL grants stockholders a qualified right to inspect corporate books and records “necessary...more

Chancery Denies Section 220 Bid for Executive Compensation Records Involving Facebook

Southeastern Pa. Trans. Auth. v. Facebook, Inc., C.A. No. 2019-0228-JRS (Oct. 29, 2019) - Shareholders of a Delaware corporation have a qualified right to access corporate books and records for a “proper purpose.” ...more

Chancery Finds Unauthorized Transfer of LLC Interest Void and Denies Transferee Inspection Rights

Absalom Absalom Trust v. Saint Gervais LLC, C.A. No. 2018-0452-TMR (Del. Ch. June 27, 2019). Plaintiff was assigned a membership interest in the defendant, a Delaware limited liability company, and sought to exercise books...more

Chancery Finds Former Limited Partner Lacks Standing to Seek Books and Records

Greenhouse v. Polychain Fund I LP, C.A. No. 2018-0214-JRS (Del. Ch. May 29, 2019). Seeking to inspect an entity’s books and records to value an investment typically is a proper purpose. But a plaintiff must have standing...more

Delaware Corporate and Commercial Case Law Year in Review - 2018

This top ten list summarizes significant decisions of the Delaware Supreme Court and the Delaware Court of Chancery over the past calendar year 2018. Originally published in Transaction Advisors....more

Chancery Dismisses Books and Records Action Based on Pending Plenary Action

CHC Investments LLC v. Firstsun Capital Bancorp, C.A. No. 2018-0610-KSJM (Del. Ch. Jan. 24, 2019). One proper purpose for a books and records inspection under Section 220 of the Delaware General Corporation Law is to...more

Chancery Addresses Lawyer-Driven Effort Defense to Books and Records Inspection

Inter-Local Pension Fund GCC/IBT v. Calgon Carbon Corp., C.A. No. 2017-0910-MTZ (Del. Ch. Jan. 25, 2019). It is sometimes fair to characterize plaintiff-side representative litigation in the corporate context as...more

Delaware Supreme Court Addresses Emails and Jurisdictional Use Conditions in Books and Records Actions

KT4 Partners LLC v. Palantir Technologies Inc., No. 281, 2018 (Del. Jan. 29, 2019) (Strine, Chief Justice). Two prevailing questions for books and records inspections under Section 220 of the Delaware General Corporation...more

Chancery Addresses Books and Records Demand Under Section 220 by Papa John’s Founder

Schnatter v. Papa John’s Int’l, Inc., C.A. No. 2018-0542-AGB (Del. Ch. Jan. 15, 2019). As a general matter, under Section 220 of the DGCL, directors of a Delaware corporation enjoy the right to virtually unfettered access...more

Delaware District Court Explains Tolling Based on Books and Records Inspection

Norman v. Elkin, C.A. No. 06-005-LPS (D. Del. Sept. 4, 2018) - Litigation seeking to inspect a corporation’s records under Section 220 of the DGCL might toll the statute of limitations for certain claims under the right...more

Court of Chancery Explains Burden Needed to Support Inspection for Suspected Wrongdoing

Barnes v. Sprouts Farmers Market Inc., C.A. No. 2017-0735-MTZ (Del. Ch. July 18, 2018) - An investor seeking books and records for the purpose of investigating wrongdoing or mismanagement must establish a “credible basis”...more

Delaware Supreme Court Reverses Corwin Dismissal and Stresses Importance of Disclosures

Morrison v. Berry, No. 445, 2017 (Del. July 9, 2018) - Corwin holds that approval of a transaction by a fully-informed, uncoerced majority of the disinterested stockholders invokes the deferential business judgment...more

Court of Chancery Enforces Broad Director-Like Books and Records Rights in the LLC Context

Obeid v. Gemini Real Estate Advisors LLC, C.A. No. 2017-0510-JTL (Del. Ch. June 5, 2018) - To facilitate the proper exercise of one’s fiduciary duties, the right of directors to inspect a corporation’s books and records is...more

Court Of Chancery Awards Nominal Damages For Breach Of Fiduciary Duty

The Ravenswood Investment Company LP v. The Estate Of Bassett S. Winmill, C.A. No. 3730-VCS (Del. Ch. Mar. 21, 2018) - It is easy to assume that some form of meaningful relief must be available when a fiduciary bears the...more

Delaware Corporate and Commercial Case Law Year In Review – 2017

This top ten list summarizes significant decisions of the Delaware Supreme Court and the Delaware Court of Chancery over the past calendar year. Our criteria for selection are that the decision either changed the law in a...more

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