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Court Of Chancery Explains Scope Of Section 225 Case

Posted In Directors

T.R. Investors, LLC v. Genger, C.A. 3994-CS (November 9, 2012)

 A Section 225 action is supposed to be limited to the narrow question of the composition of a corporation's board of directors.  Subsidiary questions, such as who owns what stock, may be resolved as well but are generally not binding on persons who are not parties to the litigation.  However, as this decision points out, if you are a party and consent to the Court deciding stock ownership in a Section 225 action, you are stuck with the judgment.

Tags: Directors