In re Tyson Foods, Inc., 2007 WL 2685011 (Del. Ch., Sept. 11, 2007), read opinion here. This is a classic Chancery Court discovery dispute that is addressed as surgically as any substantive issue in the case would be. See here for summary of prior decisions in the case and links to same, with more background facts, such as the decision that partially granted and partially denied a motion to dismiss. See In Re Tyson Foods, Inc. Consol. S’holders Litig., 919 A.2d 563 (Del. Ch.2007).
This short letter opinion includes the basic analytical framework for the scope of discovery and when it will be compelled based on Chancery Court Rule 26(b)(1) and reference to Dann v. Chrysler Corp., 166 A.2d 431, 432 (Del. Ch. 1960)(ultimately leaving it to the discretion of the court). Although the scope of discoverable data is broad as it includes anything that is reasonably calculated to lead to the introduction of admissible evidence, the court retains the discretion to prevent "fishing expeditions".
The court rejected arguments that compelling documents requested by plaintiffs was an "end run" around the purpose behind a pre-suit demand requirement. That argument can be made if the plaintiffs attempt to amend the complaint. Likewise, compelling the requested documents was not contrary to the point made in the Dann case, as the discovery sought was not for the sole purpose of looking for new causes of action. The court required production of documents in connection with related party transactions.
The court denied the part of the motion to compel that sought supplemental answers to interrogatories. The plaintiffs argued that defendants abused Rule 33(d) which allows reference to documents that have the answers when the burden of deriving the answers is about the same for the party serving the documents as for the party on whom they are served. The court reasoned that the answers sought were more efficiently obtained by deposition. The court also allowed additional time for depositions depending on what was learned from the new documents produced.