Posted In Derivative Claims

Teamsters Union 25 Health Services & Insurance Plan v. Baiera,  C.A.  No. 9503-CB (July 13, 2015)

A transaction with a controlling stockholder that is the subject of a derivative complaint still requires that a majority of the directors be interested before demand is excused.

Indeed, even past employment with the controller does not in itself establish a director is interested for the purpose of determining if demand is excused. This is an excellent review of the demand rules both generally and when the decision under attack has been made by a board committee.