Central Laborers Pension Fund v. News Corp., C.A. No. 6287-VCN (Del. Ch. Nov. 30, 2011), read letter ruling here. In this case involving a request for books and records under DGCL Section 220, the Court dismissed the suit as duplicative of a parallel suit for breach of fiduciary duty in connection with the purchase by News Corp. of a company owned by the daughter of the chairman of News Corp. The Court of Chancery concluded that the Section 220 case was moot because the plaintiff had already sued the directors of the company over the deal and therefore, a shareholder could “no longer tender a proper purpose for pursuing efforts to inspect the books and records of News Corp.” on the acquisition.
The Court explained that: “In short, the stockholder plaintiff who files a Section 220 action immediately after its derivative action is acting inconsistently.” The Court distinguished the recent Delaware Supreme Court decision on Section 220 issues in King v. VeriFone, highlighted on these pages here, as follows:
Nothing in Verifone would authorize it [i.e., a plaintiff/stockholder] to use the tools of Section 220 while actively pursuing a simultaneously-filed plenary derivative action at its early stages.”