In In re Lululemon Athletica 220 Litigation, 220 Litigation, C.A. No. 9039-VCP (Del. Ch. April 30, 2015), Vice Chancellor Donald F. Parsons Jr. held the defendant corporation in a books-and-records action under 8 Del. C. Section 220 did not have to search its non-employee directors’ personal email accounts for documents. Parsons stopped short of holding that a corporation can never be required to search the personal email accounts of its non-employee directors under Section 220, but expressed his doubts that the statute could be read so broadly so as to authorize it.

The corporation, Lululemon Athletica Inc., is a publicly traded company that designs and sells athletic wear. In 2012, Dennis “Chip” Wilson, its founder and then-chairman of the board, entered into a trading plan pursuant to U.S. Securities and Exchange Commission Rule 10b5-1 to sell up to a million shares of Lululemon stock over a period of 18 months. Wilson’s broker had complete discretion to sell the stock during that period consistent with the trading plan. On June 5, 2013, Lululemon’s then-CEO informed Wilson that she planned to resign. Two days later, she informed the board of her intent to resign. The same day, Wilson’s broker sold a large number of shares of his Lululemon stock, more than he had sold on any other day during the first six months of the trading plan. Three days later, Lululemon announced the CEO’s resignation and the share price of the company’s stock dropped roughly 22 percent.

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