The Delaware Court of Chancery, in William Hughes, Jr. v. Xiaoming Hu, et al. and Kandi Technologies Group, Inc., C.A. No. 2019-0112-JTL, memo. op. (Del. Ch. Apr. 27, 2020), denied defendants’ motion to dismiss derivative claims for failure to make demand, finding directors face a likelihood of Caremark liability for failure to implement financial controls, based on books and records absent from a purportedly complete 8 Del. C. § 220 production.
NEW: Wachtell discusses the decision in Citing Thin Board Record, Delaware Court of Chancery Again Sustains Oversight Claim.
Cooley discusses the decision in Another Caremark claim survives dismissal.
D&O Diary’s Kevin LaCroix discusses the decision in Another Delaware Breach of the Duty of Oversight Case Survives Dismissal Motion
Duane Morris discusses the decision in Better Oversight Than Hindsight: Hughes v. Xiaming Hu demonstrates that directors and officers who fail to adequately oversee their company’s management expose themselves to personal liability
UCLA’s Professor Stephen Bainbridge discusses the decision in Is Caremark still the hardest claim for plaintiffs to win in corporate law? and More on the latest Caremark claim to survive a motion to dismiss.