A recent Delaware Court of Chancery decision addressed claims that the CEO of a closely-held company breached the duty of loyalty in connection with unauthorized personal expenses charged to the company, and other actions, while he managed the company–that were not consistent with financial management in the best interest of the company. That decision, in … Continue Reading
A recent Delaware Court of Chancery opinion is noteworthy for its many quotable judicial words of wisdom about motions for reargument pursuant to Rule 59(f). In Manti Holdings, LLC v. Authentix Acquisition Company, Inc., C.A. No. 2017-0887-SG (Del. Ch. Aug. 14, 2019), the court described a meritorious motion for reargument as a “useful tool if … Continue Reading
A recent Delaware Court of Chancery decision explained that: the general rule that a director is entitled to communications with counsel for the board has exceptions, but the threshold issue is whether the attorney involved represents the whole board–or just selected board members. In Gilmore v. Turvo, Inc., C.A. No. 2019-0472-JRS (Del. Ch. Aug. 19, … Continue Reading
A recent Delaware Court of Chancery decision involved the unusual situation where a Special Litigation Committee allowed derivative plaintiffs to pursue claims challenging an acquisition of the defendant company. See In re Oracle Corp. Derivative Litigation, C.A. No. 2017-0337-SG, Letter (Del. Ch. Aug. 15, 2019). Another unusual case in which a Special Litigation Committee did … Continue Reading
The Delaware Supreme Court recently announced a decision of great importance for stockholder demands under Section 220 of the Delaware General Corporation Law. In Tiger v. Boast Apparel, Inc., No. 23, 2019 (Del. Supr. Aug. 7, 2019), the Delaware Supreme Court ruled that: (i) although inspection of records demanded by stockholders pursuant to Section 220 … Continue Reading
A recent post-trial decision from the Delaware Court of Chancery denied a claim for corporate books and records based on DGCL § 220 after finding that there was no credible basis for wrongdoing to support the stated investigative purpose for the demand. Hoeller v. Tempur Sealy International, Inc., C.A. No. 2018-0336-JRS (Del. Ch. Feb. 12, … Continue Reading
A recent seminal decision of the Delaware Court of Chancery must be included in the lexicon of every lawyer who wants to understand the boundaries of Delaware law on forum-selection clauses in corporate documents. In the case of Sciabacucchi v. Salzberg, C.A. No. 2017-0931-JTL (Del. Ch. Dec. 19, 2018), the Court determined that a forum-selection clause … Continue Reading
The Delaware General Corporation Law was amended last summer to allow companies to maintain their corporate records using blockchain technology. The purpose of this short post is to provide a high-level overview of this evolving intersection of technology and corporate law that will have an increasingly profound impact on corporate governance and related areas of the … Continue Reading
Last month, in a comprehensive advancement decision captioned White v. Curo Texas Holdings, LLC, C.A. No. 12369-VCL (Del. Ch. Feb. 21, 2017), the Delaware Court of Chancery applied what has become known in Delaware as the “Fitracks Procedures” to determine the appropriate amount of an advancement award when the exact amount of fees for covered … Continue Reading
Caspian Select Credit Master Fund Ltd. v. Key Plastics Corp., C.A. No. 8624-vcn (Del. Ch. Feb. 24, 2014). Practical Insights on Decision: This Chancery opinion is one of many examples highlighted on these pages over the last 9 years or so, of the not infrequent inefficiency and unsatisfying nature of an action based on DGCL … Continue Reading
Cook v. Hewlett-Packard Co., C.A. No. 8667-VCG (Del. Ch. Jan. 24, 2014)(revised Jan. 30, 2014). Issue Addressed: Was a stockholder entitled to additional books and records from Hewlett-Packard regarding accounting fraud at a company HP purchased? Answer: No Short Highlights This post-trial letter opinion from the Court of Chancery denying a request for books and … Continue Reading
Top Ten 2013 Delaware Corporate and Commercial Decisions By: Francis G.X. Pileggi and Kevin F. Brady This is our ninth annual review of key Delaware corporate and commercial decisions. During 2013, we reviewed and summarized over 200 decisions from Delaware’s Supreme Court and Court of Chancery on corporate and commercial issues. Among the decisions with … Continue Reading
Grace v. Ashbridge LLC, C.A. No. 8348-VCN (Del. Ch. Dec. 31, 2013). Issue Addressed: Whether a successor entity was liable for advancement and indemnification claims based on the operating agreement of a successor entity LLC even though the sole allegations involve a predecessor entity and a related entity. Short Answer: No. Brief Overview: An understanding … Continue Reading
In Silverberg v. Gold, et al., C.A. 7646-VCP (Dec. 31, 2013), the Court of Chancery denied defendants’ motion to dismiss a derivative action (for failure to make demand) alleging a breach of fiduciary duty based on insider trading against the directors of Dendreon Corporation, a biotechnology company which had only one commercially available drug product, … Continue Reading
The following article first appeared in a recent edition of The Delaware Business Court Insider. A recent decision of the Delaware Court of Chancery in the case of Osram Sylvania, Inc. v. Townsend Ventures, LLC, C.A. No. 8123-VCP (Del. Ch. Nov. 19. 2013), denied a motion to dismiss a breach of contract claim and a … Continue Reading
Boris v. Schaheen, C.A. No. 8160-VCN (Del. Ch. Dec. 2, 2013). Issue Addressed: Whether the written consents of stockholders pursuant to DGCL Section 228 effectively selected new board members. Brief Overview This 51-page post-trial decision addressed the effectiveness of written consents of stockholders that were designed to select new board members. The two entities involved … Continue Reading
Anderson v. Krafft-Murphy Company, Inc., Del. Supr., No. 85-2013 (Nov. 26, 2013). Issue Presented: Delaware’s Supreme Court addresses issues of first impression in this opinion, including: does Delaware’s corporation dissolution scheme (8 Del. C. Sections 278 to 282) have a “general” statute of limitations for claims by third-parties against dissolved corporations? Short Answer: No. [Editor’s … Continue Reading
Klaassen v. Allegro Dev. Corp. et al., No. 8626-VCL (Del. Ch. Nov. 7, 2013). This Chancery decision is the subject of an appeal to the Delaware Supreme Court. Among the issues to be addressed by Delaware’s high court is whether the actions of a board to dismiss the CEO, who also had voting power over a controlling percentage … Continue Reading
Pfeiffer v. Leedle, C.A. No. 7831-VCP (Del. Ch. Nov. 8, 2013). Issue Addressed: Whether the approval of stock option grants that exceeded the maximum number of stock options allowed under the stock incentive plan was the basis for a breach of fiduciary duty claim against both the board that approved it and the executive who … Continue Reading
We previously highlighted the Court of Chancery decision that upheld a forum selection provision in corporate bylaws that required certain suits involving the internal affairs of the corporation to be filed in Delaware. Boilermakers Local 154 Retirement Fund v. Chevron Corporation, C.A. No. 7220-CS (Del. Ch. June 25, 2013). Professor Larry Hamermesh writes about the voluntary … Continue Reading
Louisiana Municipal Police Employees’ Retirement System v. Hershey Co., No. 7996, Master’s Report (Del. Ch. Aug. 16, 2013). This decision rejected a demand for books and records of the Hershey Company based on DGCL Section 220. The stockholder claimed, in essence, that Hershey’s management must be complicit in the abhorrent child labor practices in the two West … Continue Reading
Huff v. Longview Energy Co., C.A. No. 8453-CS (Del. Ch. Aug. 12, 2013). This short letter ruling granted a motion to dismiss a claim for indemnification pursuant to DGCL section 145(c) based on the reasoning that the claim was premature in light of the underlying judgment being subject to a pending appeal. Even though a … Continue Reading
Southeastern Pennsylvania Transportation Authority v. Volgenau, C.A. No. 6354-VCN (Del. Ch. Aug. 5, 2005) Issue addressed: This Chancery opinion explains the procedures to follow in order to benefit from the business judgment rule’s deferential standard of review for a merger that involves a controlling shareholder and a third-party. This decision provides a road map for … Continue Reading
In re Dell Inc. Shareholder Litigation, No. 8329, hearing transcript released (Del. Ch. June 27, 2013). In a ruling from the bench, the Court of Chancery denied a request for expedited proceedings requested by challengers of the pending deal involving Dell. The plaintiffs failed to convince the court that they had a “colorable claim” that … Continue Reading
