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A few days after highlighting an analysis of Delaware
corporate law in an opinion by Judge Richard Posner of the 7th Circuit that
discussed aspects of a director's fiduciary duties, here, (including
the benefit of scholarly insights on the ruling by Professors Ribstein and
Bainbridge), comes a decision from the Arkansas Court of Appeals that applies
Delaware corporate law on the issue of pre-suit demand futility in the context
of a derivative suit. In Berry v. Dillard, 2011 Ark. App. 242 (Mar. 30,
2011), read opinion here, the
seminal Delaware cases on the issue of demand futility were recited in a manner
that exhibited a firm grasp of the principles and nuances represented by those
cases and their progeny.
Why, one might ask, do I burden the reader with what an
Arkansas court says about Delaware law? The reason is that this is another
indication of what some regard as an increasing trend of non-Delaware courts
opining on Delaware law. A recent article by David Marcus of The Deal,
especially towards the end of the article discusses some of the
conventional wisdom on the topic, in which he refers to several recent
Delaware decisions that have been somewhat censorious in connection with
lawyers who did not maintain the high standards that the Delaware courts expect
of lawyers and their clients.
We have also refererred on these pages to law professors
who have done empirical studies that support the existence of a tendency for
some cases to be filed in non-Delaware courts even when Delaware law applies. See,
e.g., here and
See also a tangential post here,
about a recent article by a Delaware Supreme Court justice that describes
procedures that are available for non-Delaware state courts by which issues of
Delaware law may be certified to the Delaware Supreme Court so that a definitive
ruling on Delaware law can provide instruction to non-Delaware courts applying
Read more Delaware business
litigation case summaries and commentary on Delaware
Corporate and Commercial Litigation Blog, a blog hosted by Francis G.X.
Pileggi, of Fox Rothschild LLP.
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