Starting last summer and through the early part of this year, plaintiffs’ lawyers filed several shareholder derivative lawsuits against the boards of a number of companies alleging that the directors had breached their fiduciary duties by failing to include African American individuals on their boards. As I have detailed in previous posts (most recently here), these suits have not fared well, as courts have granted the motions to dismiss each of the cases in which courts have ruled on dismissal motions. In the past week, the courts in two more of these cases – involving the boards of NortonLifeLock and OPKO Health – granted the defendants’ motions to dismiss. The August 30, 2021 order in the NortonLifeLock case can be found here and the September 1, 2021 order in the OPKO Health case can be found here.
Continue Reading Two More Board Diversity Lawsuits Dismissed

As I noted a prior post, on August 6, 2021, the SEC, in a split vote along party lines, approved Nasdaq’s proposed listing guidelines requiring companies listed on the exchange to comply with board diversity requirements or explain their failure to do so. On August 9, 2021 a nonprofit directors’ organization called the Alliance for Fair Board Recruitment filed a petition with the Fifth Circuit Court of Appeals seeking to have the appellate court review the SEC’s order. The organization explained its move in an August 18, 2021 press release, stating that it sought to challenge the order because it “will compel many of our nation’s largest publicly traded corporations to illegally discriminate on the basis of gender, race, and sexual orientation” in selecting directors. The appellate petition can be found here. The August 18 press release can be found here.
Continue Reading Court Challenge to Nasdaq Board Diversity Rules Filed

Cybersecurity firm NortonLifeLock became the latest company to be hit with a shareholder derivative lawsuit alleging that, despite company statements about its  commitment to diversity and inclusion, the company’s board and senior management lacks racial diversity. The NortonLifeLock lawsuit follows after substantially similar lawsuits – filed by the same law firm – were previously filed against Oracle (about which refer here), Facebook (here), and Qualcomm (here). A copy of the August 5, 2020 lawsuit against NortonLifeLock’s board can be found here.
Continue Reading NortonLifeLock Hit with Board Diversity Derivative Suit

After the recent civil disturbances and social unrest, there has been a renewed focus on equality and diversity issues. Among many other things, investors and activists are raising concerns about the lack of racial diversity on corporate boards. For example, just last week, a California legislator introduced a bill that would require corporations to include on their boards persons from “underrepresented communities.” Now, in addition to these legislative efforts, an activist investor seeking to advance board diversity objectives has launched a shareholder derivative lawsuit against the directors of Oracle Corporation, accusing the board of violating their legal duties by failing to diversify the company’s board and otherwise failing to address diversity and equality issues. A copy of the investor’s complaint can be found here.
Continue Reading Oracle Directors Hit with Derivative Suit on Board Diversity Issues