Tag Archives: Fee-shifting bylaw

Del. Court Pans Fee-Shifting Portion of Forum Selection Bylaw

Many readers will recall that just a short time ago companies were actively experimenting to try to incorporate litigation management measures into their corporate bylaws. These efforts led to decisions by Delaware courts upholding both forum selection bylaws (about which refer here) and fee-shifting bylaws (refer here). Delaware’s legislature ultimately addressed these bylaw experimentation efforts … Continue Reading

Delaware Legislature Passes Fee-Shifting Bylaw Prohibition — What Questions Remain?

In a late night session on June 11, 2015, the Delaware House of Representatives overwhelmingly passed S.B. 75, which prohibits Delaware stock corporations from adopting “loser pays” fee-shifting bylaws and which confirms that Delaware corporations may adopt bylaws designating Delaware courts as the exclusive forum for shareholder litigation. The bill, which previously passed the state’s … Continue Reading

A Q&A with Mark Lebovitch of Bernstein Litowitz: A Plaintiffs’ Counsel’s Perspective on the Fee-Shifting Bylaw Debate

One of the more significant recent developments in the corporate and securities litigation arena has been the emergence of the debate over fee-shifting bylaws following the Delaware Supreme Court’s May 2014 decision in ATP Tour, Inc. v. Deutscher Tennis Bund. Draft proposed legislation is now being considered by the Delaware legislature that would address fee-shifting … Continue Reading

Guest Post: New Debate in January on Delaware Bylaws re Shareholder Liability

In numerous posts (most recently here), I have noted the ongoing controversy in Delaware on this issue whether or not companies organized under the laws of that state should be able to adopt so-called fee-shifting bylaws. In the following guest post, Tanya Dmitronow, Rachel Wolkinson, and Stacey Eilbaum, all of whom are litigation lawyers at … Continue Reading

Battle Builds in Delaware Over Fee-Shifting Bylaws

Earlier this year, after the Delaware Supreme Court upheld the facial validity of fee-shifting bylaws in the case of ATP Tour, Inc. v. Deutscher Tennis Bund (as discussed here), a legislative initiative quickly emerged to restrict the case’s holding to Delaware non-stock companies. However, the initiative proved to be controversial, and the legislative proposal was … Continue Reading

Two Legal Surveys: Foreign Disputes in U.S. Courts and Fee-Shifting Bylaws

An ever-present anxiety for globally-active non-U.S. companies is the possibility that they might find themselves having to deal with litigation in U.S. courts. This concern is warranted because certain attributes of the U.S. legal system – including the absence of loser pays attorneys’ fee model and the availability of discovery and jury trials – provide … Continue Reading

IPO Companies and Fee-Shifting Bylaws

One of the more interesting recent developments in the D&O liability arena has been the emergence of issues surrounding fee-shifting bylaws. As readers will recall, in May 2014, the Delaware Supreme Court in the ATP Tours case upheld the validity of a non-stock corporation’s bylaw imposing attorneys’ fees on an unsuccessful claimant in an intra-corporate … Continue Reading

Oklahoma Legislature Adopts Derivative Litigation Fee-Shifting Provision

One of the most interesting recent developments has been the onset of innovative litigation reform efforts in the form of bylaw revisions. Among the most intriguing of these efforts involves fee shifting bylaws, whereby an unsuccessful claimant in intracorporate litigation must pay the other party’s costs. As discussed here, earlier this year, the Delaware Supreme … Continue Reading

Though Delaware Legislature Has Tabled Action, Upcoming Judicial Review of Fee-Shifting Bylaws Seems Likely

The Delaware Supreme Court stirred up quite a bit of controversy earlier this year in the ATP Tours, Inc. v. Deutscher Tennis Bund case when it upheld the facial validity of a fee-shifting by law. The bylaw provided that an unsuccessful shareholder claimant in intracorporate litigation would have to pay his or her adversaries’ cost … Continue Reading

More About Stories We’re Following

Cybersecurity as a D&O Liability Issue: I have noted in prior posts on this site (refer for example here) that cybersecurity represents, among other things, a D&O liability exposure. The recent lawsuits filed against Target (refer here) and Wyndham Worldwide (refer here) underscore this point. In addition, at least according to a July 7, 2014 Bloomberg … Continue Reading

Delaware Legislative Proposal to Restrict Fee-Shifting Bylaws Held Over to Next Year

As I noted in a recent post (here), in response to a recent Delaware Supreme Court decision upholding the facial validity of fee-shifting bylaws, proposed legislation was  introduced in the Delaware General Assembly to limit the Supreme Court’s ruling and to restrict the ability of Delaware corporations to utilize their bylaws to shift the costs … Continue Reading

Delaware Legislative Revision Proposed to Restrict Fee-Shifting Bylaws

As discussed in a recent post (here), in a May 8, 2014 decision the Delaware Supreme Court upheld the facially validity of a nonstock corporation’s bylaw provision shifting attorneys’ fees and costs to unsuccessful plaintiffs in intra-corporate litigation. Because the court’s holding seemed to be equally applicable to stock corporations as well as to nonstock … Continue Reading
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