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Court of Chancery Reviews Advancement Law on Counterclaims

Paolino v. Mace Security International Inc., C.A. 4462-VCL (December 8, 2009)

In this decision the Court examines when a corporate officer is entitled to have his fees advanced in defending a counterclaim against him. The opinion does so in the context of a full explanation of the Cochran. line of cases that determine when an employee is entitled to indemnification (when sued for acting in an official capacity) and when he is not (when sued for breaching his employment contract). That is not as easy a distinction as it may seem, and this case helps us understand it

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