Judge Thomas Griesa
Gamoran’s derivative actionalleging civil RICO claims and state law-based claims for corporate waste, negligence, and breach of fiduciary dutyagainst the Neuberger Berman International Fund, and its investment advisors stemmed from the Funds’ purchase of shares of online gambling businesses from the London Stock Exchange in 2005 and 2006. Share prices plummeted through 2006 and 2007 after crackdowns on Internet gambling closed off the U.S. market. The Fund defendants’ allegedly illegal stock ownership constituted the predicate acts for Gamoran’s civil RICO claims. Noting that similar actions had previously been filed in New York state court and Delaware’s Chancery Court, district court dismissed Gamoran’s direct claims, holding that the did not comply with Delaware’s demand requirement. His derivative claims were dismissed with leave to replead. Recalling the circumstances surrounding Gamoran’s demand to the Neuberger defendants’ board the court determined that given the novelty and complexity of the issues, the fact that the board did not take action on Gamoran’s demand before he filed action on Aug. 24, 2011, did not give rise to a reasonable doubt as to the good faith of the board’s investigation.
