The Delaware Supreme Court late last month strengthened the basis for suing directors and officers of Delaware corporations, saying a phrase that had been effectively “excised” from state law for more than a generation allows state courts to impose jurisdiction where the officials were only a “necessary or proper party” to a lawsuit.
The General Assembly included the phrase in Section 3114 of Title 10 of the Delaware Code, but the courts have declined to apply it since 1980, when Delaware Court of Chancery Chancellor William Marvel read it out of the consent statute over concerns that it was prone to an overbroad reach that could endanger due process rights.
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