News & Analysis as of

Corporate Officers Duty of Care

Bowditch & Dewey

Solving the Puzzle to Improve Corporate Governance

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An often overlooked and critical function of operating a successful business is sound corporate governance. But what is corporate governance? Generally stated, corporate governance encompasses the rules, mechanisms and...more

Jenner & Block

Delaware’s 102(b)(7) Exculpation of Senior Officers - One Year Later

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For more than thirty-five years, Delaware law, pursuant to Section 102(b)(7) of the Delaware General Corporation Act (DGCL), has allowed Delaware corporations to exculpate their directors from personal liability for damages...more

Morrison & Foerster LLP

What Fiduciary Duties Do I Have as a Director of a Delaware Corporation?

You’re an entrepreneur, you form your first company, and suddenly you carry the title of founder, director, officer, and/or employee all at once. When running your business, it may feel like all of your roles blur together....more

Fox Rothschild LLP

Delaware Court Decision Poses New Liability Risks for Corporate Officers

Fox Rothschild LLP on

A recent Delaware Court of Chancery decision exposes corporate officers to significant liability for breach of fiduciary duties and indicates a trend in Delaware courts in which it is now possible for plaintiffs to assert and...more

Sheppard Mullin Richter & Hampton LLP

Delaware Court of Chancery Holds that Officers of a Delaware Corporation Are Subject to Fiduciary Duty of Oversight

In In re McDonald’s Corp. Stockholder Derivative Litigation, No. 2021-0324 (Del. Ch. Jan. 26, 2023), the Delaware Court of Chancery (Laster, V.C.) held that officers of a Delaware corporation are subject to a fiduciary duty...more

Dechert LLP

Delaware Court of Chancery Issues Significant Decision Addressing Fiduciary Duties of Officers, Including Holding that Officers...

Dechert LLP on

Corporate officers owe the same fiduciary duty of oversight as directors. Just as with directors, officers fulfill their oversight duty by acting in good faith....more

Sherman & Howard L.L.C.

New Year, New Certificate of Incorporation?

States are beginning to extend exculpation protections to corporate officers that were previously afforded only to directors. Depending on where your corporation is chartered, you may soon be considering the opportunity to...more

Cozen O'Connor

Amendment to DGCL §102(b)(7); Expanding Exculpation Rights to Apply to Corporate Officers

Cozen O'Connor on

For more than 35 years, Section 102(b)(7) of the General Corporation Law of the State of Delaware (DGCL) has permitted a Delaware corporation to include a provision in its certificate of incorporation that eliminates or...more

Skadden, Arps, Slate, Meagher & Flom LLP

Inflation and Market Turmoil: How Directors, Officers and Other Fiduciaries Can Stay Ahead in Uncertain Times

Key Points - In light of current economic uncertainty, directors, officers and other fiduciaries should stay abreast of material information, even absent a specific actionable transaction. An analysis of audits of financial...more

Mintz Edge

Amendment to Delaware Law Permits Exculpation of Officers in Corporate Charters

Mintz Edge on

Delaware has long permitted corporations to limit or eliminate monetary liability of directors from breach of fiduciary duty of care lawsuits. However, the same protections have not been afforded to a corporation’s officers....more

Jones Day

Delaware Authorizes 102(b)(7) Exculpation of Senior Officers

Jones Day on

In Short - The Situation: Until now, Delaware corporations could eliminate or limit monetary liability for breaches of the duty of care only by directors—but not officers. ...more

Smith Anderson

North Carolina Business Court Clarifies Corporate Director Duties of Care

Smith Anderson on

The North Carolina Business Court recently issued a lengthy opinion discussing the duties of corporate directors. Key points include: ..Directors comply with their duty to exercise adequate oversight if the board makes a...more

Dorsey & Whitney LLP

Proposed Statutory Officer Exculpation in Delaware

Dorsey & Whitney LLP on

As we transition into spring, the minds of many corporate attorneys return to the annual updates proposed to the Delaware General Corporate Law (DGCL). If the changes proposed by the Council of Corporation Law Section of the...more

Kerr Russell

Court Ruling Offers New Consideration For Corporate Officers, Directors And LLC Managers

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Managers of LLCs have similar duties to members of LLCs. A breach of these fiduciary duties can lead to a lawsuit and personal liability for directors, officers and LLC managers. ...more

Freeman Law

Fiduciary Duties of the Board of Directors in Texas

Freeman Law on

A corporation operates through its board of directors. All corporate powers must be exercised by or under the direction of the board. In Texas, the Texas Business Organizations Code (TBOC) provides certain provisions...more

K&L Gates LLP

Health Care Triage: Key Considerations for Officers and Directors of Distressed Companies

K&L Gates LLP on

In this week’s episode, Andrea Cunha outlines some of the key considerations directors and officers should assess when their company is approaching insolvency, including how to evaluate financial distress of the company, the...more

Skadden, Arps, Slate, Meagher & Flom LLP

Recent Trends in Officer Liability

More than a decade ago in the seminal case Gantler v. Stephens, the Delaware Supreme Court clarified that officers of Delaware corporations owe the same fiduciary duties of care and loyalty that directors owe to the...more

Baker Donelson

Directors and Officers: Key Considerations for Continued Response to COVID-19

Baker Donelson on

As COVID-19 cases spike in many jurisdictions throughout the Southeast, corporations are forced to quickly adapt to an ever-changing environment. Despite the need to act quickly, corporate boards must remain mindful of, and...more

Balch & Bingham LLP

10 Key Steps To Follow When Your Business is Approaching Insolvency

Balch & Bingham LLP on

It is well known that directors and officers of corporations (and managers of limited liability companies) owe fiduciary duties to their organizations and their shareholders (or members). These fiduciary obligations are...more

Foley & Lardner LLP

Managing the Commercial Impact of the Coronavirus: Top 5 Considerations When Operating in the Zone of Insolvency

Foley & Lardner LLP on

Given the uncertainty of the effects of this pandemic on markets and industries in the U.S. and around the world, many businesses are now confronting significant and unique challenges which are causing financial distress...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

Winstead PC

Making the Right Choice: The Obligation to Comply With Fiduciary Duties By The Directors, Managers and Officers of Private Texas...

Winstead PC on

Fiduciary. The term applies broadly to cover all types of companies, as well as spouses in marriage, and is defined as “of, relating to, or involving a confidence or trust.” In the private business context, the company’s...more

Blake, Cassels & Graydon LLP

Cybersecurity Risks: Directors and Officers Should Stop, Collaborate and Listen

The risks associated with cyber-attacks and data breaches are growing in Canada and internationally and the costs associated with an organization preventing, detecting, responding to and recovering from such an incident can...more

Proskauer - Not for Profit/Exempt...

IRS Encourages Private Foundations to Consider Charitable Purposes in Investing Its Assets

As we previously reported, the IRS has updated its guidance with helpful examples concerning program-related investments for private foundations. In its recently issued Notice 2015-62, the IRS provides further assurance that...more

Foley & Lardner LLP

Legal Considerations in Businesses’ Disaster Planning

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In the last decade, Disaster Recovery (“DR”) and Business Continuity Planning (“BCP”) have become “hot” topics, as companies attempt to deal with disasters and the associated business risks. “Force majeure” is a legal concept...more

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