A Cautionary Lesson for Boards When Faced With Shareholder Demands for Books and Records
Jeffrey Lang and Colin Bridge provide an in-depth discussion of 'Ontario Provincial Council of Carpenters' Pension Trust Fund v. Walton,' where the Delaware Court of Chancery provided a cautionary lesson for corporate boards and their counsel on the risks of sharply limiting the scope of responses to shareholder demands for information.
October 17, 2023 at 10:00 AM
16 minute read
In its April 26, 2023 opinion in Ontario Provincial Council of Carpenters' Pension Trust Fund v. Walton, the Delaware Court of Chancery provides a cautionary lesson for corporate boards and their counsel on the risks of sharply limiting the scope of responses to shareholder demands for information. No. 2021-0827-JTL, 2023 WL 3093500 (Del. Ch. April 26, 2023).
In Walton, the court denied the defendants' motion to dismiss, in large part due to Walmart's decision to both extensively redact and withhold as privileged documents the company produced in response to a books and records demand under Delaware law.
While the Walton decision arose in the context of a motion to dismiss a derivative case on the ground of demand futility, Vice Chancellor Travis Laster's guidance can be extrapolated to the broader context of discovery in shareholder and other litigation.
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