Francis Pileggi

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Corporate Law Seminar

I have been asked to provide information about the following seminar on corporate law at Rutgers Law School-Camden: The Rutgers Center for Corporate Law and Governance is presenting a conference on corporate compliance on Friday, May 20, 2016, from 8:30 AM to 3:30 PM, entitled New Directions in Corporate Compliance. The conference will take place … Continue Reading

CEOs as Social Justice Warriors

Yesterday’s Wall Street Journal featured a front page article about an apparently increasing number of CEOs of public companies who use their companies’ resources, and wield their companies’ resources as a sword, to advocate in their official corporate capacities to advance their favorite social agendas–or to oppose legislation on social policies that they disfavor. Courtesy of highly-regarded corporate law scholar … Continue Reading

Supreme Court Rules on Duties of Delaware Directors

The Delaware Supreme Court recently ruled on the duties of directors of Delaware corporations who are appointed by particular stockholders. In OptimisCorp v. Waite, Del. Supr., No. 523, 2015 (2016), Delaware’s high court issued a nine-page Order with several substantive footnotes that provide practical insights for those who need to know what the rights and … Continue Reading

Chancery Rejects Advancement Claim for Fees on Fees

Generally, a successful claim for advancement of legal fees for a former director or officer entitles the prevailing party to “fees on fees” incurred for obtaining the favorable ruling. A recent ruling from the newest member of the Delaware Court of Chancery explains the limitations or the contours of that general rule. In Wong v. USES Holding … Continue Reading

No Per Se Duty to Disclose Financial Statement in Closely Held Company

A recent Delaware Court of Chancery transcript ruling is notable for stating that there is no per se affirmative obligation, absent a request for stockholder action, in a closely held company, to produce financial statements. The court held, however, that under certain circumstance, for example in response to a demand under DGCL Section 220, it could … Continue Reading

Chancery Explains Policy Reasons for Awarding Advancement to Former Director

The Delaware Court of Chancery’s opinion in Marino v. Patriot Rail Company LLC, C.A. No. 11605-VCL (Del. Ch. Feb. 29, 2016), is noteworthy for providing the most detailed historical analysis and doctrinal underpinning for the legislative scheme that requires corporations under certain circumstances to provide advancement to former directors and officers, that has come along in … Continue Reading

Supreme Court Rejects Claims Against Directors

The Delaware Supreme Court, in a short Order issued not long after oral argument, rejected the arguments on appeal that challenged a decision of the Court of Chancery that dismissed claims that directors were beholden to those that they had business relationships with. Greater Pennsylvania Carpenters’ Pension Fund v. Giancarlo, et al., No. 531-2015, Order … Continue Reading

Supreme Court Expands Basis to Sue Directors and Officers in Delaware

The Delaware Supreme Court recently interpreted the statutory basis for imposing jurisdiction over directors and officers of Delaware corporations in a manner that is broader than the interpretation that previously prevailed in Delaware courts for the last 30 years. Hazout v. Tsang, No. 353, 2015 (Del. Supr., Feb. 26, 2016). Directors and officers of Delaware … Continue Reading

Delaware Allows Claims Based on Extra-Contractual Statements About Merger

Allegations are commonly made that representations outside the four corners of the parties’ agreement about a merger or similar deal were untrue, and the buyer relied to his detriment on them. A recent decision from the Delaware Court of Chancery addresses the types of provisions in an agreement that could bar such claims for misrepresentation based on extra-contractual … Continue Reading

RIP Justice Scalia

U.S. Supreme Court Justice Antonin Scalia has gone to his eternal reward. The front page of The New York Times today quoted Court of Appeals Judge Richard Posner as writing in 2011 that Justice Scalia was “the most influential justice of the last quarter century.” Whether you agreed with his views or not, he was in … Continue Reading

Delaware High Court Rejects Claims Against GM Directors

Frank Reynolds of Thomson Reuters reports on the Delaware Supreme Court’s recent affirmance of a Chancery ruling which dismissed claims against GM directors. He reports that: Dissident General Motors investors have failed to persuade the Delaware Supreme Court to give them another chance to prove the automakers’ directors negligently relied on a defect reporting system … Continue Reading

Chancery Determines that Electronically-Stored Information and Personal Emails of Directors Must Be Provided to Stockholders

The Delaware Court of Chancery published an opinion this week that interpreted a statute that gives stockholders a right to demand the “books and records” of a company, to include the right to demand electronically-stored information not only from the corporation, but also from its directors and officers. Amalgamated Bank v. Yahoo!, Inc., C.A. No. 10774-VCL (Del. Ch. Feb. 2, … Continue Reading

Chancery Awards Fees for Therapeutic Benefit Originating in a Ruling That Bylaw Amendment Not Applicable to Prior Stockholders

In a recent ruling from the bench, the Court of Chancery approved fees for a therapeutic benefit that had its genesis in a ruling from March 2015, that was previously highlighted on these pages in the matter of Strougo v. Hollander, and which determined that a bylaw amendment would not apply to former stockholders when … Continue Reading

Chancery Sounds Death Knell for Most Disclosure-Only Settlements

The Delaware Court of Chancery recently issued a seminal decision that may signal the end of (at least) most disclosure-only settlements in class action cases that challenge mergers. In Re Trulia Inc. Stockholder Litigation, C.A. No. 10020-CB (Del. Ch. Jan. 22, 2016), is must reading for those interested in class action settlements in general, and disclosure-only settlements in particular. Michael … Continue Reading
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