In  Kaufman v. CA, Inc., read decision here, the Chancery Court denied a Motion to Compel in a proceeding for books and records under DGCL Section 220.  The company provided considerable documentation but the stockholder thought she was entitled to additional documents.  The court disagreed.

 The court denied the request for more records and determined that the stockholder:

 “failed to sufficiently articulate why the additional documents are either necessary or essential to her concededly proper purpose and thus failed to meet the standard under 8 Del. C. Section 220. "

 In a previous opinion, the Chancery Court denied a Motion to Stay the Section 220 case in favor of the investigation being conducted by the company’s Special Litigation Committee.  See Kaufman v. Computer Associates International, Inc., 2005 WL 3470589 (Del. Ch., Dec. 13, 2005). [Note: CA, Inc. was formerly known as Computer Associates.]  After that 2005 decision, CA agreed to produce the requested documents, subject to any applicable privileges.  The plaintiff in this case filed a Motion to Compel after that production, believing that she was entitled to certain documents that were not produced.

 The court noted the somewhat unique procedural posture of the motion, styled as one to compel, in a Section 220 case in which the defendant has conceded the propriety of the Section 220 demand and has already furnished substantial documentation.  Thus, the motion required the court to consider issues that usually arise in the course of a substantive Section 220 trial.  The court summarized the limited nature of  a proceeding to consider a demand for books and records to which one is entitled, if the prerequisites of Section 220 have been satisfied.  That is, “when a books and records action is brought with the goal of evaluating a possible derivative suit, the books and records that satisfy the [220] action are those that are required to prepare a well pleaded complaint.  Of course, this means that Section 220 is not meant as a replacement for discovery under [Rule] 34.”  (emphasis mine.)

 In denying the request for additional documents, the court observed:  “that a document would be potentially discoverable under Rule 34 does not make it necessary and essential under Section 220” (emphasis mine.) This is another example, among others summarized on this blog, that a Section 220 case is not always a simple matter.