Last summer and early fall there was a rash of shareholder derivative lawsuits – mostly filed in California, mostly filed against tech companies – based on allegations that the target companies’ boards had breached their duties by failing to include African American board members. The filings of these kinds of lawsuits trickled off after the California legislature adopted a bill requiring companies based in California to meet specified board diversity requirements. However, if a recent lawsuit filied is any indication, the board diversity lawsuit filing trend may not have entirely played out after all.
On February 9, 2021, a plaintiff shareholder launched a new board diversity lawsuit, this time against the board of Micron Technology. As discussed below, this most recent lawsuit is different than the earlier lawsuits in certain key ways. A copy of the complaint against the Micron Technology board can be found here.
Continue Reading Micron Technology Hit with Board Diversity Law Suit
In a derivative lawsuit settlement with one of the highest nominal dollar values ever – and in what is one of the largest #MeToo-related D&O lawsuit settlement ever – Google parent Alphabet has agreed to establish a $310 million diversity, equity, and inclusion fund as part of the settlement of the consolidated derivative litigation relating to the company’s alleged mishandling of sexual harassment allegations against senior executives and the company’s alleged overall culture of sexual discrimination and harassment. The company also agreed to adopt extensive reforms to its employment policies and to implement a number of governance reform measures as part of the settlement. The settlement is subject to court approval.
California-based high technology firm Cisco Systems is the latest company to be hit with a racial diversity lawsuit, based on allegations that its directors breached their fiduciary duties to the company by failing to include an African-American on the company’s board, despite the company’s numerous statements about its commitment to diversity. Though this latest lawsuit is in many respects similar to the previously filed board diversity lawsuits, it does differ in that it was not filed by the plaintiffs’ firm that has filed most of these lawsuits and also because the lawsuit follows a pre-suit demand on Cisco’s board, by contrast to most of the prior suits where the plaintiffs had made no demand and instead argued demand futility. A copy of the complaint in the Cisco Systems action can be found 
One of the focal points in the scrutiny that has followed in the wake of the current social justice movement has been the question of diversity at America’s companies, including the lack of diversity on corporate boards. Among other things, a number of boards of public companies lacking Black directors have been sued in a series of shareholders derivative lawsuits alleging that the board members violated their fiduciary duties by failing to live up to state diversity objectives, as discussed most recently. Now, in the latest example of this type of litigation, a plaintiff shareholder has filed a derivative lawsuit against the board of Monster Beverage Corporation, alleging that the directors breached their fiduciary duties and deceived investors by claiming to have diversity and inclusion programs while have no Black directors on the board. A copy of the complaint can be found 
The current racial justice movement has created an environment in which corporations and other organizations are under pressure to reconsider and address their diversity and inclusion practices. Organizations that lack racial diversity in their corporate leadership – particularly on their boards of directors – have come in for increasing criticism and, as I have noted on this blog (most recently
In yesterday’s 
In the latest in a series of lawsuits against high-profile companies alleging that the companies’ boards lack African-American directors, a plaintiff shareholder has filed a shareholder derivative lawsuit against the board of directors of the clothing retailer, The Gap. The lawsuit is substantially similar to the lawsuits filed by the same plaintiffs’ law firm against Oracle (
In the latest in a series of lawsuits that recently have been filed against corporate directors based on board diversity issues, a Qualcomm shareholder has filed a derivative lawsuit against the company’s board, alleging that the company’s directors violated their duties to the company and shareholders by falling short of stated objectives on diversity and inclusion and by falling to include a single African-American either on the board or among the company’s senior officers. The lawsuit against Qualcomm follows similar lawsuit filed earlier this month against