10th Circuit Highlights Difference Between Delaware And Nevada Exculpatory Statutes

Because the power to manage a corporation’s affairs rests with the board of directors, it is normally up to the board to decide whether the corporation will pursue a claim.  A shareholder who believes that the corporation should sue must therefore make a demand on the board.  If the board decides against suing, then the

He Had A Vice President’s Title And The Company Identified Him As “Management”, But He Was No Officer

Delaware attorney Francis Pileggi recently wrote about a ruling in the Court of Chancery concerning Nevada’s private corporation law.  The case, Eric Pulier v. Computer Sciences Corp., et al., C.A. No. 12005-CB, hearing (Del. Ch. May 12, 2016), arose from Computer Science Corporation’s acquisition in 2013 of Agility Platform, Inc., which was formerly known as ServiceMesh, Inc. After

Over 1,000 Nevada Business Entities To Lose Their Registered Agent

In 2007, Nevada adopted the Model Registered Agents Act.  It is currently one of 10 states to have done so (plus the District of Columbia). Nevada’s enactment of the model act may have been predestined by the fact that the chair of the committee appointed by the National Conference of Commissioners on Uniform State Laws

Federal Court Rules “Mere Affiliation” Is Insufficient To Establish Personal Jurisdiction

Nearly four years ago, I wrote about a Nevada Supreme Court decision holding that Nevada courts can exercise personal jurisdiction over nonresident officers and directors who directly harm the corporation.  Consipio Holding, BV v. Carlberg, 282 P.3d 751 (2012).  At the time, Nevada did not have an implied consent statute similar to Del. Code tit. 10,

Court Finds Plaintiffs Are Not Privies

Yesterday’s post noted that the plaintiff in a derivative suit is bringing claims on behalf of the corporation.  Thus, when a derivative suit is dismissed, does that dismissal have any effect on other pending or subsequently filed derivative suits?  This is a topic that I first discussed a few years back in Delaware Court of Chancery “Overrules” Federal Court.  That post was critical of

Compromising and Settling of Derivative Suits In California

When a shareholder sues derivatively, the shareholder is seeking relief not for itself, but for the corporation.  Therefore, it should be expected that the shareholder is not free to compromise or dismiss the suit absent court oversight.  For example, Rule 23.1 of the Federal Rules of Civil Procedure provides: A derivative action may be settled, voluntarily

California And Nevada Corporations Can Do This But Not Delaware Corporations

Sometimes it’s nice to tidy up the corporate stock book.  For example, a corporation may effect a stock split and want to collect the outstanding certificates and exchange them for new certificates reflecting the change.  California and Nevada provide a mechanism for this Delaware does not. California Corporations Code Section 422(a) provides: When the articles are

Why Did This Dissolved Corporation File Reports With The SEC For Another 18 Years?

Recently, I happened upon across an odd case arising currently pending in the Southern District of Texas, Aztec Oil & Gas, Inc. v. Fisher, Case No. Civ. No. A. H-15-0866 (Jan. 21, 2016).  The ruling issued by Judge Melinda Harmon last month recounts a tangled tale of alleged corporate shenanigans.  What caught my interest was the fact that

Delaware Inspection Ruling May Cause Yahoo! Inc. To Regret Not Incorporating In Nevada

In a recent blog post, Delaware lawyer Francis Pileggi discusses a recent ruling by Vice Chancellor J. Travis Laster ordering Yahoo! Inc. to produce personal emails of directors and electronically stored information in response to a stockholder inspection demand pursuant to Section 220 of the Delaware General Corporation Law.  Amalgamated Bank v. Yahoo!, Inc., C.A. No.

A Failure To Mediate Results In A Failure To Litigate

Mediation is often viewed as less costly alternative to litigation.  Therefore, it is not unusual for parties to include a mediation provision in their contracts, such as the following: The parties agree that any disputes or questions arising hereunder, including the construction or application of [the] Agreement shall be submitted to mediation between [MBA] and [Alaska