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Directors Not Liable for Bad Decision In Rejecting Settlement of Lawsuit

Directors Not Liable for Bad Decision In Rejecting Settlement of Lawsuit

Directors Not Liable for Bad Decision In Rejecting Settlement of Lawsuit

Ohio Court cites doctrine of litigation privilege, but disclaims ability to provide indemnification
The Court of Appeals of Ohio has ruled that directors of a nonprofit trade association cannot be sued on behalf of the corporation for turning down a settlement offer in a defamation suit that would have saved the Association $43 million. But it has also ruled that it had no jurisdiction to force the association to indemnify the directors who successfully defended the suit, saying that could be done only by a court in Delaware, the state of the association’s incorporation. The unusual rulings arose in a case involving the Certified Steel Stud Association, which was sued for defamation after it released a report making allegedly derogatory assertions that products made by Clarkwestern...

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