Litigation developments: fundamental shareholder rights.
On March 25, 2025, the Delaware Legislature enacted Senate Bill 21, significantly amending the Delaware General Corporation Law. Among its notable changes is an effort to narrow document production under Section 220, which...more
Wong Leung Revocable Tr. v. Amazon.com Inc., C.A. No. 2023-1251-BWD (Del. Ch. May 1, 2024) - In order to inspect books and records under Section 220 of the Delaware General Corporation Law, a stockholder-plaintiff must...more
2023 was a busy year, with both the Delaware courts and others, including the U.S. Supreme Court, weighing in on shareholder and M&A litigation issues. The Delaware Court of Chancery issued several notable decisions on issues...more
Section 220 demands are a commonly used tool for stockholders to gain access to a company’s books and records. Although this provision of the Delaware General Corporation Law vests stockholders with a right of access thereto,...more
After a de novo review of the record following a Magistrate in Chancery’s final report, Vice Chancellor Fioravanti of the Delaware Court of Chancery declined to accept the Magistrate’s recommendation to deny a...more
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
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
In this issue, we discuss recent Delaware court developments regarding officer liability, who can recover “lost-premium” damages, and trends in books and records actions, among other topics....more
As discussed in prior articles, stockholder plaintiffs have increasingly sought to obtain companies’ books and records under 8 Del. C. § 220 (Section 220) and the Delaware Limited Liability Company Act’s analogous provision,...more
In Lawrence B. Seidman v. Blue Foundry Bancorp, the Delaware Court of Chancery awarded US$223,651.60 in attorneys’ fees and expenses to a plaintiff stockholder because of the defendant’s “glaringly egregious litigation...more
Hauppauge Digital, Inc. v. Rivest, C.A. No. 2019-0848 (Del. July 10, 2023). Under Delaware law, once a stockholder has established a proper purpose to inspect a corporation's books and records, the Court of Chancery has...more
Simeone v. The Walt Disney Company, C.A. No. 2022-1120-LWW (Del. Ch. June 27, 2023) - The Walt Disney Company opposed Florida legislation that limits instruction on sexual orientation and gender identity in Florida...more
Rivest v. Hauppauge Digital, Inc., C.A. No. 2019-0848-PWG (Del. Ch. Sept. 1, 2022) - Plaintiff stockholder sought to inspect the books and records of a defendant company, requesting a narrow universe of annual and...more
What is a books and records demand? Under Delaware General Corporation Law Section 220, stockholders have the right to inspect corporate records. Strict compliance with the statute is mandatory....more
In In re The Boeing Company, the Delaware Court of Chancery held that Boeing stockholders that sued the company over losses relating to safety problems with Boeing’s 737 MAX airplane had adequately pleaded that a majority of...more
The Supreme Court of Delaware recently affirmed a decision by the Court of Chancery that ordered a corporation to produce certain books and records to a shareholder, and which granted leave to the shareholder to take a...more
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
POSCO Energy Co., Ltd. v. FuelCell Energy, Inc., C.A. No. 2020-0713-MTZ (Del. Ch. Oct. 22, 2020) - Under Court of Chancery Rule 15, a Delaware plaintiff may request leave from the Court to amend or supplement a complaint....more
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
In Juul Labs, Inc. v. Grove, 2020 Del. Ch. LEXIS 264 (Del. Ch. Aug. 13, 2020) (Laster, V.C.), the Delaware Court of Chancery held that the “internal affairs doctrine” bars a stockholder of a Delaware corporation headquartered...more
Rule 23.1 of the Delaware Court of Chancery Rules requires a plaintiff asserting a shareholder derivative action to plead “with particularity the efforts, if any, made by the plaintiff to obtain the action the plaintiff...more
Paraflon Investments, Ltd. v. Linkable Networks, Inc., C.A. No. 2017-0611-JRS (Del. Ch. Apr. 3, 2020). Sometimes it bears repeating that Section 220 actions are intended to be summary proceedings to evaluate a...more
Skadden partner Edward Micheletti, who heads the litigation practice of the firm’s Wilmington office, answers common Delaware law questions facing boards of directors during the COVID-19 crisis....more
In Salladay v. Lev, the Delaware Chancery Court elaborated on how early a corporate board must take protective measures to shield a conflicted transaction from entire fairness review. Salladay involved a motion to dismiss a...more
Delaware law usually protects directors in making good faith business decisions. However, the recent Delaware Court of Chancery AmerisourceBergen decision signals a two-part trend of (i) increased stockholder access to...more