Corporate Litigation: Preclusion in Derivative Litigation
In their monthly Corporate Litigation column published in the New York Law Journal, Litigation Partner Joe McLaughlin and Associate Shannon McGovern discuss how a recent Delaware Supreme Court decision mitigates uncertainty arising from two Delaware Court of Chancery decisions urging that the longstanding stockholder derivative preclusion rule violates due process. The article also assesses how the rule that stockholders asserting derivative claims in Delaware cannot relitigate demand futility allegations asserted unsuccessfully elsewhere will likely spur an increase in efforts by plaintiffs to intervene in parallel derivative suits filed in other fora.