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Nevada Supreme Court Adopts Delaware's Direct Harm Test For Derivative Claims

On the same day that the Nevada Supreme Court rejected Delaware's approach to reviewing special litigation committee determinations, it adopted Delaware's test for determining whether a shareholder suit is derivative or direct.  Parametric Sound...

Nevada Corporations, Parametric Sound Corp., Cohen v. Mirage, derivative, direct harm, Tooley v. Donaldson

Review Of Special Litigation Committee Recommendations

Yesterday's post limned the Nevada Supreme Court's adoption of New York's Auerbach standard of review for special litigation committee recommendations.  In re Dish Network Derivative Litigation, 133 Nev. Adv. Op. 61 (2017).  The Supreme Court...

Nevada Corporations, derivative action, evidentiary hearing, In re Dish Network, Justice Kristina Pickering, SLC, Special Litigation Committee

Nevada Favors New York Over Delaware Precedent For SLC Review

Nevada law endows a board of directors "full control over the affairs of the corporation".  NRS 78.120(1).  This control is subject only to such limitations as may be provided by NRS chapter 7, or the articles of incorporation of the corporation.  ...

Nevada Corporations, New York, Auerbach, business judgment rule, Delaware, derivative suit, In re Dish, SLC, Special Litigation Committee, Zapata

Nevada Precedes Delaware In Blockchain Legislation

On July 21, 2017, Delaware's 74th Governor, John Carney, signed SB 69 into law.  This legislation amended various provisions of Delaware's General Corporation Law (Title 8, Delaware Code) ostensibly to establish express statutory authority for...

Nevada Corporations, SB 398, blockchain, Brian Sandoval, Gayle M. Hyman, John Carney, MAtthew P. Digesti, Uniform Electronic Transactions

Suing The CEO For Social Activism Is Likely To Be Challenging Under Nevada Law

Yesterday's post concerned asked the question whether shareholders can sue CEOs for social activism.  The answer is of course, yes.  The more interesting question is whether shareholders will win the suit.  To answer that question, one must first...

Nevada Corporations, officer liability, business judgment rule, CEO, NRS 78.138, other constituency statute, social activism

Does Disclosure Of Results Of Internal Investigation Constitute Subject Matter Waiver?

Last Friday, I wrote about one of the docketed appeals in Wynn Resorts, Limited v. Eight Jud. Dist. Ct., 41 Nev. Adv. Op. 52 (2017).  Today's post concerns the other docketed appeal in that case.  This appeal addressed whether disclosure of an...

Nevada Corporations, Louis Freeh, at issue, attorney-client privilege, Attorney-Client Privilege/Work Product, because of test, internal investigation, James W. Hardesty, Limited, waiver, work product doctrine, Wynn Resorts

Does Assertion Of Business Judgment Rule Waive Attorney-Client Privilege?

Nevada, like California, has codified the attorney-client privilege:

A client has a privilege to refuse to disclose, and to prevent any other person from disclosing, confidential communications:

  1. Between the client or the client’s representative...

Nevada Corporations, NRS 49.095, Nevada Supreme Court, advice of counsel, attorney-client privilege, Attorney-Client Privilege/Work Product, business judgment rule, Limited, NRS 78.138, Okada, waive, Wynn Resorts

Nevada's Constitutional Limitation On Shareholder Liability

Article 8, Section 3 of the Nevada Constitution provides:

Dues from corporations shall be secured by such means as may be prescribed by law; Provided that corporators in corporations formed under the laws of this State shall not be individually...

Nevada Corporations, Goldfield, Nevada, Nevada constitution, NRS 78.225, Seaborn v. Wingfield, Section 3, Article 8, george wingfield

Is It A Breach Of Fiduciary Duty To Fail Or Refuse To Conform To Delaware's Judicial Decisions Or Practices?

The answer to this question in Nevada may soon be an unequivocal "no".  Last week, the Nevada Legislature unanimously passed SB 203 and sent it to Governor Brian Sandoval for signature.  Among other things, Section 2 of SB 203 declares:

The...

Nevada Corporations, nevada corporation, SB 203, Delaware precedents, NRS 78.138, SB203

Alter Ego and the Nevada LLC

California's version of the Revised Uniform Limited Liability Company Act expressly subjects members to potential alter ego liability:

 A member of a limited liability company shall be subject to liability under the common law governing alter ego...

Limited Liability Companies, Nevada Corporations, llc, webb v. shull, 17703.04, Alter Ego, Jennifer A. Dorsey, Limited Liability Company, Pharmaplast S.A.E. v. Zeus Medical, piercing the corporate veil

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30172DBAB0084D3A8F39D7AF0A8E79BC.ashxKeith Paul Bishop
Partner at Allen Matkins
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