On May 12, 2020, Chancellor Bouchard of the Delaware Chancery Court issued a 28-page post-trial ruling. In the decision, the Court directed judgment for PSD’s corporate client on a claim that it failed to deliver books and records pursuant to the company’s operating agreement. The decision followed a one-day trial. Aside from the production of portions of a couple of documents to which PSD’s client made no objection, PSD’s client prevailed in the entirety on every issue. Click here to view a copy of the decision.
The Plaintiff equityholder claimed the company’s Class A members improperly removed him as CEO. He also claimed that he was entitled to access numerous categories of books and record, including massive amounts of electronic files. In the written opinion, the Court acknowledged that Plaintiff’s burden to show a “credible basis” to suspect wrongdoing amounted to the lowest burden recognized under Delaware law. Nevertheless, the Court found that Plaintiff failed to meet his minimal burden at trial.