The Delaware Court of Chancery, in Avery L. Woods v. Sahara Enterprises, Inc., C.A. No. 2020-0153-JTL, memo. op. (Del. Ch. July 22, 2020) — an action seeking inspection of corporate books and records action — rejects defendant holding company’s argument that it cannot produce records because it is managed by a sister entity, finding the position supports plaintiff’s purpose of inspection to investigate possible wrongdoing because it allows a reasonable inference that defendant’s board abdicated its duties to another entity.
Francis Pileggi discusses the decision in Chancery Clarifies Nuances of Section 220 Stockholder Demand for Inspection Rights
Frank Reynolds discusses the decision in Chancery Court says inspection cannot be thwarted by claiming records are out of reach at sister firm.