Main Menu

Showing 6 posts in Chancery.

Chancery Denies Section 220 Bid for Executive Compensation Records Involving Facebook

Southeastern Pa. Trans. Auth. v. Facebook, Inc., C.A. No. 2019-0228-JRS (Oct. 29, 2019)

Shareholders of a Delaware corporation have a qualified right to access corporate books and records for a “proper purpose.” One such proper purpose is to investigate potential mismanagement or fiduciary wrongdoing. Indeed, Delaware law encourages shareholders to use this “tool at hand” prior to bringing a derivative action. But this type of inspection has an important precondition: the shareholder must advance some evidence to suggest a “credible basis” from which the Court can infer actionable wrongdoing. As this decision involving Facebook illustrates, the credible basis standard is lenient but not meaningless, and may turn on, among other things, the potential for monetary damages arising out of the alleged wrongdoing. After a trial on a paper record, the Court of Chancery denied an attempt by two stockholders of defendant Facebook, Inc. to obtain additional documents related to the company’s executive compensation practices. More ›


Court Of Chancery Applies Business Judgment Rule After Majority Tender Shares

In Re Volcano Corp. Stockholder Litigation, C.A. 10485-VCMR (June 30, 2016)

In what might be one of the most important decisions this year, the Court held that the tender of their shares by a majority of the stockholders invokes an “irrebuttable” presumption that the business judgment rule applies and, as a result, the complaint generally must be dismissed.  This extends the Delaware Supreme Court’s Corwin decision to the tender offer context.  While the tender offer aspect of this case will get the most notice, the concept of an “irrebuttable” business judgment rule may prove to be more important.  For when that form of the business judgment rule applies, only facts demonstrating waste will let a complaint survive a motion to dismiss.  Of course, waste is almost impossible to successfully allege under Delaware law.


The Dilemma of the Unintended Fiduciary

Authored By Edward M. McNally This article was originally published in the Delaware Business Court Insider October 8, 2014 A recent Delaware decision highlights a trap for the unwary adviser to a business entity. The decision holds that helping a business get started may create fiduciary duties owed by the adviser, even if he or she is not acting in one of the roles that are normally thought of as creating such duties, such as serving as a lawyer or trustee. Because those fiduciary duties limit what the adviser may do for those other than his or her immediate client, it is important to recognize when those duties exist. More › Share

Court of Chancery Rejects Limits on Advancement Rights

Authored By Lewis Lazarus This article was originally published in the Delaware Business Court Insider October 1, 2014 {Note the decision discussed in this article was certified to the Delaware Supreme Court on October 6, 2014.} By statute and case law, Delaware has long protected the rights of officers and directors to advancement of fees and expenses incurred defending claims arising out of the officers and directors' service. The public-policy rationale is that in the absence of such protection, qualified individuals would be reluctant to serve in management positions. Corporations whose documents are expansive in providing advancement, however, often are less generous when the time comes to advance company funds to someone the company believes has misused his or her position to the detriment of the company and its stakeholders. While a substantial body of case law has clarified many of the circumstances where directors and officers are entitled to advancement over the company's objections, issues continue to arise that enable the court to provide fresh guidance. The recent case of Pontone v. Milso IndustriesC. A. No. 8842-VCP (Del. Ch. August 22, 2014), sheds light on the nature of claims entitled to advancement, whether a right to third-party advancement vitiates a director or officer's entitlement to advancement from the corporation itself, and the type of counterclaims that are subject to advancement. More › Share

Morris James Receives Top Legal Rankings in Chambers USA 2014

Posted In News
Morris James LLP is pleased to announce that thirteen attorneys in five separate practice areas have been top ranked among the leading Delaware lawyers in the 2014 edition of Chambers USA: America's Leading Lawyers for BusinessChambers also ranked four of its practice areas as among the top practices in Delaware including Bankruptcy/Restructuring, Chancery, Intellectual Property and Labor & Employment. Read more. Share

Chancery Closing the Door to Multidistrict Litigation

Authored by Edward M. McNally
This article was originally published in the Delaware Business Court Insider | October 9, 2013 

There is much agitation over multiforum litigation. Both the typical defendants in such cases, corporations involved in a merger, and the courts decry what they see as duplicative suits over the same dispute in two or more jurisdictions. The past legal rules that might have resolved the issue of what case goes forward no longer seem to work. The Delaware Court of Chancery is now moving forward to develop new approaches to resolve the problems presented by multiforum litigation over the same basic dispute. More ›



  • US News Best Law Firms
  • JD Supra Readers Choice Award
  • Delaware Today Top Lawyers
  • Super Lawyers
Back to Page