Delaware Business Litigation Report

Court Of Chancery Lifts Stay

In re Molycorp Inc. Shareholder Derivative Litigation, C.A. 7282-VCN (May 12, 2014)

This decision clearly explains when a derivative suit should be stayed in favor of securities litigation elsewhere. The general rule is that when the derivative suit depends on the outcome of the securities litigation because it seeks recovery of the damages to be paid for a securities law violation, the derivative suit should be stayed.  Of course, when the derivative suit is not dependent on the securities litigation outcome, the stay should be lifted.

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