and its board and concluding years of deliberation at both the Delaware Court of Chancery and Supreme Court levels over whether a hastily pursued derivative suit
should have a preclusive effect against more diligent plaintiffs.
In fact, the complainant in a derivative suit
must transmit "[n]otice of [the] proposed settlement, voluntary dismissal or compromise [.
Similarly, a shareholder filed a derivative suit
in February 2014 against certain directors and officers of Wyndham Hotels in connection with three data breaches that exposed the credit card information of over 600,000 customers.
Among those firms publicly alleged to have engaged in backdating--in analyst reports or news coverage--a majority, but not all, were named in a derivative suit
Now picture this: years later, shareholders file a derivative suit
claiming that the directors breached their fiduciary duty by making excessive awards to themselves, even though these awards fell within the limit of the plan the shareholders approved.
Among the transactions cited in the derivative suit
was a series of multimillion-dollar payments of company funds authorized by Alliance management to BSJ Fishing and Trading Inc.
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.
Despite being much maligned, the follow-on derivative suit
may actually clarify the duties of directors in FCPA compliance and advance the corporate governance reforms of corporations, separately from the deterrent effect of government enforcement.
Baker once represented a Park City resident in a shareholder derivative suit
against a major company.
20) Any recovery in a derivative suit
is returned to the corporation.
NCUA cited the CapCorp case in its WesCorp court documents, stating that "in dismissing the case, the district court held that in addition to failing to exhaust 27 administrative remedies, the plaintiffs lacked standing to bring the suit because only the board, and not the individual credit union members, could bring a derivative suit
on behalf of the credit union.