The Delaware Court of Chancery yesterday denied a motion to dismiss a class action alleging that the directors and sponsor of a special-purpose acquisition company (a “SPAC”) breached their fiduciary duties by disloyally depriving the SPAC’s public stockholders of information material to their decision whether to redeem their stock before
Court of Chancery of the State of Delaware
Delaware Supreme Court Allows Use of “Reliable” Hearsay to Support Books-and-Records Demand
By Jonathan Richman on
The Delaware Supreme Court held yesterday that a stockholder seeking to inspect corporate books and records may use “reliable” hearsay to establish the propriety of the purpose of the inspection demand. The decision in NVIDIA Corp. v. City of Westland Police and Fire Retirement System (July 19, 2022) does not appear to break new ground on this issue, inasmuch as the Court concluded that it “appeared” to have allowed the use of sufficiently reliable hearsay in a 26-year-old decision, which neither party here asked the Court to revisit or overrule.
Seventh Circuit Reverses Dismissal of Derivative Action Based on Forum Clause as Applied to Federal Claim
By Jonathan Richman & Joseph Hartunian on
A recent Seventh Circuit decision in Seafarers Pension Plan v. Bradway may complicate defendants’ ability to use forum-selection bylaws as a basis for dismissal of derivative suits pleading claims under the Securities Exchange Act of 1934.