to have been caused by the directors' gross
Separately, the complainants--led by Chua--recently filed a derivative suit
accusing SyCip, the Dees, Malonzo, and three other officers of deliberately mismanaging and siphoning company finances to their personal gain.
The chapter on litigation comes earlier in the book so that students can become familiar with derivative suit
procedures in order to understand the cases on fiduciary duties.
Corporate law leaves them with one other recourse: a derivative suit
challenging a specific expenditure or program of activity that is allegedly harmful to the corporation.
In case of a derivative suit
, the plaintiff shareholder sues on behalf of the corporation.
DERIVATIVE DEMANDS: A procedural requirement in many states which requires a shareholder who wants to bring a derivative suit
to first make a demand on the board of directors that it rectify the perceived wrong.
Fischel & Michael Bradley, The Role of Liability Rules and the Derivative Suit
in Corporate Law: A Theoretical and Empirical Analysis, 71 CORNELL L.
McCollum (33) that the corporation had no obligation to indemnify directors who were vindicated in a derivative suit
because the directors' triumph yielded no benefit for the corporation.
Baker once represented a Park City resident in a shareholder derivative suit
against a major company.
Second, the dataset includes a number of cases that may not reflect the typical derivative suit
. Specifically, 40 of the 182 cases (22 percent) involved allegations that the defendants backdated or otherwise repriced stock options.
15 after three members of Oracle's board approved a " derivative suit
" as part of the Special Litigation Committee.
Misconduct-Related Derivative Suit
, D&O DIARY (Oct.