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Securities Litigation Shareholder Derivative Claims
Securities Litigation Shareholder Derivative Claims | Shareholder Derivative Claims |
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So-called derivative claims against the directors and officers of public companies are a common litigation threat. These suits are brought by an existing shareholder on behalf of the company against its officers and directors, usually alleging breach of fiduciary duty. The relief sought generally is not monetary: rather, plaintiffs seek to impose corporate governance or management changes they believe are in their long-term interest as investors. A derivative suit often will be filed in tandem with a shareholder class action, but they can be stand-alone actions filed in lieu of class actions, when grounds for the latter do not exist. Stradling’s Securities Litigation Group has deep expertise in shareholder derivative actions. As with other shareholder actions, the key to defending these suits is to act quickly and vigorously to move to dismiss the suit before the claim can get a legal footing and traction with the court. Our Securities Litigators also work closely with the firm’s corporate transactional attorneys to advise clients on proper corporate governance practices to prevent derivative suits or to increase the likelihood they will be dismissed at the pre-trial stage. |