News & Analysis as of

Board of Directors Motion to Dismiss Corporate Governance

Morris James LLP

Chancery Dismisses Executive Compensation Action For Failure To Plead Demand Futility

Morris James LLP on

Eckert v. Hightower, C.A. No. 2024-0569-MTZ (Del. Ch. Mar. 24, 2025) - A board of directors approved compensation packages for the company’s CEO, who also was its controlling stockholder. The CEO was a member of the...more

Venable LLP

Chancery Court Dismisses Equitable Challenge to Advance Notice Bylaws as Unripe

Venable LLP on

Invoking the recent Delaware Supreme Court decision Kellner v. AIM ImmunoTech Inc., 320 A.3d 239 (Del. 2024) (“Kellner”), the Court of Chancery held that equitable challenges to the enforceability of advance notice bylaws are...more

A&O Shearman

Delaware Supreme Court Holds Business Judgment Rule Applies To Controlled Corporation’s Change Of Corporate Domicile From Delaware...

A&O Shearman on

On February 4, 2025, the Delaware Supreme Court, on interlocutory appeal, reversed the decision of the Delaware Court of Chancery to deny defendants’ motion to dismiss breach of fiduciary duty claims against directors and a...more

A&O Shearman

Northern District Of California Grants Motion To Dismiss Federal Securities Class Action Against Subscription Streaming Services...

A&O Shearman on

On November 26, 2024, Judge Jon S. Tigar of the United States District Court for the Northern District of California granted a motion to dismiss a putative securities fraud class action against a subscription streaming...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

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

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

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

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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