News & Analysis as of

Breach of Duty

Big Data and the Risks of Insider Trading

In the perennial quest for alpha, investment managers have turned increasingly to big and alternative data for market insights. The most prominent consumers of this data on Wall Street are managers of ‘‘quant’’ funds, which...more

Delaware Court Of Chancery Relies On Corwin To Dismiss Post-Closing Fiduciary Duty Claims After Finding Acquiror Was Not A...

by Shearman & Sterling LLP on

On March 9, 2018, Vice Chancellor Joseph R. Slights III, of the Delaware Court of Chancery, dismissed a stockholder class action complaint seeking damages for alleged breaches of fiduciary duty by directors of Rouse...more

Delaware Supreme Court Affirms Delaware Court Of Chancery's Dismissal Of Fiduciary Duty Breach Claims, Finding Non-Exculpated...

by Shearman & Sterling LLP on

On March 15, 2018, the Supreme Court of Delaware affirmed the Delaware Court of Chancery’s dismissal of a putative stockholder class action asserting claims for breach of fiduciary duty and quasi-appraisal against the...more

ERISA class actions: Ninth Circuit rules that a third-party administrator is NOT an ERISA fiduciary with respect to the terms of...

The Employee Retirement Income Security Act of 1974 (“ERISA”) imposes fiduciary duties on certain parties that deal with retirement and health care plans. In a recent class action, Santomenno v. Transamerica Life Ins. Co.,...more

Court Affirms Punitive Damages In A Breach-Of-Fiduciary-Duty/Partnership Dispute

by Winstead PC on

In Home Comfortable Supplies, Inc. v. Cooper, the defendant induced others to start a new limited partnership with his corporation. No. 14-16-00906-CV, 2018 Tex. App. LEXIS 1381 (Tex. App.—Houston [14th Dist.] February 22,...more

The Cash-Out Merger Solution to the Problem Minority Owner

by Farrell Fritz, P.C. on

How can majority business owners legally rid themselves of a problematic minority owner? Not by transferring the business’s assets to another entity for no consideration. ...more

Second Circuit Rejects Manifest Disregard Of Law As A Basis For Vacating An Arbitration Award

by Carlton Fields on

A panel of the Second Circuit has, in an unpublished summary order, emphasized the high bar that must be cleared by a party seeking to vacate an arbitration award. The matter arose from the decision of a financial advisor...more

Business Judgment or Entire Fairness: The Meaning of Delaware’s Interested Director Statute

Cummings v. Eden et al was a case where the Delaware Court of Chancery examined allegations that members of a board of directors breached their fiduciary duties in connection with the approval an asset acquisition at an...more

Court Considers Interaction between Alleged Controlling Stockholder and Corwin

In Re Rouse Properties, Inc. Fiduciary Litigation considers what the Delaware Court of Chancery describes as a pattern in the post-Corwin, post-MFW world....more

Your Daily Dose of Financial News

by Robins Kaplan LLP on

No US? No big deal. At least when it comes to the once-and-future TPP pact, which Japan, Canada, Australia, and 8 other US allies signed yesterday in Santiago, Chile....more

Court Of Chancery Explains Proper Evidence To Support Inspection Claim

by Morris James LLP on

In Re UnitedHealth Group Inc. Section 220 Litigation, C.A. 2017-0681-VCMR (February 28, 2018) - To obtain inspection rights from a Delaware corporation to investigate alleged wrongdoing, the petitioner needs some evidence...more

Delaware Superior Court Upholds Coverage For Fraud Claim

by Morris James LLP on

Arch Insurance Company v. Murdock, C.A. N16C-01-104 EMD CCLD (March 1, 2018) - This decision upholds coverage under a D&O policy for a claim alleging fraud by directors. This is not too surprising as the Delaware...more

Court Of Chancery Holds Demand Is Not Excused When Only Best Practices Were Not Followed

by Morris James LLP on

Wilkin v. Narachi, C.A. 12412-VCMR (February 28, 2018) - Demand on directors is not required when it is alleged that they have violated a statute or rule. But when the claim is only that they violated the "best practices”...more

Court Held That Estate Beneficiary Did Not Have Standing To Assert Forfeiture Or Breach Claim Against Executrix’s Attorneys, That...

by Winstead PC on

In re Nunu, an estate beneficiary sued the executrix to have her removed due to alleged breaches of fiduciary duty and also sought to have the court refuse to pay her attorneys in representing her in a removal action and/or...more

Defence + Indemnity: February 2018 - VI. SURETY AND BOND ISSUES

by Field Law on

VI. SURETY AND BOND ISSUES - A. Supreme Court of Canada finds obligee/trustee under a Labour and Material Payment Bond breached the fiduciary duty owed to a claimant by failing to disclose existence of the Bond. Valard...more

Patronage capital case dismissed

Pennsylvania’s REA Energy Cooperative, Inc. obtained dismissal of a putative class action lawsuit last year, a decision that was recently confirmed by the US District Court for the Western District of Pennsylvania. The...more

Delaware Court Of Chancery Dismisses Derivative Breach Of Fiduciary Duty Claims In Connection With Publication Of Non-Final Drug...

by Shearman & Sterling LLP on

On February 28, 2018, Vice Chancellor Tamika Montgomery-Reeves of the Delaware Court of Chancery dismissed claims against the directors of Orexigen Therapeutics Inc. (“Orexigen”) for alleged breaches of fiduciary duty in...more

Federal Court Rejects Plan Fiduciaries’ Motion to Compel Arbitration

by Hodgson Russ LLP on

A recent court ruling offers interesting insights as to how a court might analyze the enforceability of arbitration agreements and clauses. An employee of Charles Schwab participated in Charles Schwab’s defined contribution...more

An Easy and Effective Way for Employers to Protect Themselves

by Jaburg Wilk on

Imagine this scenario: Your company is in Arizona and one of your sales representatives goes to work for a competitor. He knows all about your pricing and bidding practices, so he helps your competitor undercut your prices....more

Defence + Indemnity: February 2018 - II. LIABILITY ISSUES B.

by Field Law on

II. LIABILITY ISSUES - B. Where a hospital employee leaked the fact that the Plaintiff patient to family members, she was held liable for the tort of publication of embarrassing facts and damages of $7,500 were awarded for...more

Reinstating A Post-Closing Merger Challenge, Delaware Supreme Court Holds Views Expressed By Directors In Connection With A...

by Shearman & Sterling LLP on

On February 20, 2018, the Delaware Supreme Court, in an opinion by Chief Justice Leo E. Strine, Jr., reversed the dismissal of a suit brought by former stockholders of Diamond Resorts International (“Diamond”) challenging the...more

North Carolina Court Of Appeals Extends Section 75-1.1’s Securities Exemption Beyond Securities

by Ellis & Winters LLP on

We have recently examined several cases that explore the contours of two related exemptions to liability under N.C. Gen. Stat. § 75-1.1—the internal business disputes doctrine and the securities exemption. Courts generally...more

Court of Chancery Explains DGCL Section 141

by Morris James LLP on

Cummings v. Eden, C.A. 13007-VCS (February 20, 2018) - This decision is particularly helpful in clarifying the effect of Section 141 of the DGCL. A transaction that is passed by the vote of even a single disinterested...more

Court Of Chancery Explains Proper Purpose Analysis

by Morris James LLP on

KT4 Partners LLC v. Palantir Technologies Inc., C.A. 2017-0177-JRS (February 22, 2018) - When a demand to inspect corporate records states a purpose other than to value the corporation’s stock, it is often difficult to...more

Delaware Corporate and Commercial Case Law Year In Review – 2017

by Morris James LLP on

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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