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    LLC's Failure To File Cross-Complaint Dooms Double Derivative Action

    Although the members of a limited liability may file a derivative action, the right of action belongs to the LLC and not to the members themselves.  This fundamental principle had real consequences for the plaintiffs in Heshejin v. Rostami, 2020...

    Derivative Suits, derivative action

    The Board and #MeToo

    The following fact pattern should be familiar.  A high-profile news story runs detailing years of sexual harassment by the CEO of a company.  Four women sued, claiming that the CEO repeatedly propositioned or groped female employees, and rewarded or...

    Derivative Suits

    Plaintiffs File Amended Complaint Against Yahoo! But Is Something Missing?

    Last spring, a derivative suit was filed in California Superior Court against certain of current and former directors and officers of Yahoo!, Inc. alleging breach of fiduciary duty in connection with the company's widely reported data breach.  The...

    Derivative Suits

    Delaware Supreme Court Defines "Collusion"

    A couple of years ago, I taught Administrative Law at the University of California, Irvine School of Law.  One of the many theories that we covered was the idea of "regulatory capture".  This is a "term coined by public choice economists to indicate...

    2017 Del. LEXIS 522, Birmingham v. Good, Caremark claim, collusion, Delaware Supreme Court, Derivative Suits, Duke Energy, regulatory capture

    Delaware Special Litigation Committee Review "Could Stand A Good Tweaking"

    UCLA Law School Professor Stephen Bainbridge recently critiqued the Nevada Supreme Court's decision to follow Auerbach v. Bennett, 419 N.Y.S.2d 920 (1979) rather than Delaware's Zapata Corp. v. Maldonado, 430 A.2d 779 (Del. 1981).  He concludes:

    Nevada Corporations, Derivative Suits, Auerbach v. Bennett, Delaware, derivative action, derivative suit, SLC, Stephen Bainbridge, Zapata

    Does California Side With Delaware Or New York On Special Litigation Committee Reviews?

    As discussed in the two preceding posts, Nevada's Supreme Court last week decided to adopt New York's standard of review of special litigation committee recommendations to dismiss stockholder derivative suits.  In re Dish Network Derivative...

    Derivative Suits, Auerbach, Desaigoudar v. Meyercord, In re Dish Network Derivative, Special Litigation Committee, Zapata

    Court Of Appeal Holds LLC's Former Counsel May Represent Insider Defendants In Derivative Suit

    Derivative actions can be somewhat confusing.  Although the entity is essentially the plaintiff, it is named as a defendant.  Initially, one might question why must the corporation be named as a party?  I can think of at least two reasons.  First,...

    Limited Liability Companies, Richard M. Aronson, Derivative Suits, Beachcomber Management, CCP Section 382, derivative, disqualification, successive representation

    Federal Judge Rules Out Private Cause Of Action Under California Control Person Statute

    Some persons may be deemed to violate the Corporate Securities Law of 1968 even though they did not directly violate the law.  Corporations Code Section 25403(a) provides that a person who with knowledge directly or indirectly controls and induces...

    California Securities Laws, primary violator, Section 25403, Derivative Suits, Apollo Capital, control person liability, derivative, Jon S. Tigar, private right of action, Shaev v. Baker, Wells Fargo

    U.S. District Court Finds Personal Jurisdiction In Derivative Suit

    I think it is beyond peradventure that a state enjoys personal jurisdiction over corporations incorporated within that state.  What about the personal jurisdiction over the corporation's directors and officers?  That was the question addressed by...

    personal jurisdiction, Derivative Suits, Uncategorized, 2017 U.S. Dist. LEXIS 9657, Consipio holdings bv v. carlberg, derivative suit, judge jennifer A. Dorsey, Sonoro Invest SA v. Miller

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