You are here

Foundation Director May Bring Derivative Suit Without Prior Demand on Directors

Foundation Director May Bring Derivative Suit Without Prior Demand on Directors

Foundation Director May Bring Derivative Suit Without Prior Demand on Directors

Court agrees that demand on majority of directors would be futile when claims involve their conduct and compensation
A trial court in North Carolina has refused to dismiss a corporate derivative suit brought by a private foundation director on behalf of the foundation and against the other four directors for breach of fiduciary duty and gross mismanagement. The director is seeking damages for foundation and removal of the other directors from the board. The defendants had claimed that the director did not meet the requirements of state law to make demands on them before filing the action. Albert Earle Finley, III, a relatively new member of the board of the foundation founded by his grandfather philanthropist Albert E. Finley in 1977, complained that the other members breached their fiduciary duties to...

lock The full text of this article is available to paid subscribers only. Login or subscribe to read more

 

Sign-up for our weekly Q&A; get a free report on electioneering