The Court Of Chancery Dismisses Derivative Suit Against Truecar Officers And Directors, Finding Plaintiffs Failed To Allege Substantial Risk Of Liability By A Majority Of The Board
By EsqSocial Corporation 26/10/20
Under Court of Chancery Rule 23.1, a stockholder who wishes to bring a derivative claim on behalf of a corporation must “allege with particularity the efforts, if any, made by the plaintiff to obtain the action the plaintiff desires from the directors [of the company] or comparable authority and the reasons for the plaintiff’s failure to obtain the action or for not making the effort.” The latter concept is known as “demand futility.”......
By: McCarter & English, LLP