The Delaware Supreme Court recently clarified the circumstances when a fraudulent concealment claim will toll a contractual limitations period. In LGM Holdings, LLC v. Gideon Schurder, et al., the sellers of a pharmaceutical business moved to dismiss the buyers’ claims for breaches of the representations and warranties in the parties’ purchase agreement, arguing they were time-barred by a five-year survival period in the agreement’s indemnification provision. The buyers argued that this five-year period should be tolled under the fraudulent concealment doctrine, but the trial court disagreed, dismissing the claim after finding that fraudulent concealment did not toll the survival period because the buyers had learned of the potential claim within that five-year period. The Delaware Supreme Court reversed the dismissal, and in doing so, offered useful guidance for the pleadings requirements for a fraudulent concealment claim and when fraudulent concealment will apply to a contractual limitations period.
https://ma-litigation.sidley.com/wp-content/uploads/sites/3/2024/05/MN-18360_Updated-Enhanced-Scrutiny-Blog-imagery_833x606_32.jpg606833Ian M. Rosshttps://ma-litigation.sidley.com/wp-content/uploads/sites/3/2022/08/sidleyLogo-e1643922598198.pngIan M. Ross2025-06-18 11:26:002025-06-18 11:26:00Winding Back the Clock: Delaware Supreme Court Clarifies When Fraudulent Concealment Resets a Contractual Limitations Period
On May 14, Texas Governor Greg Abbott signed Senate Bill 29 (“S.B. 29”), which amends the Texas Business Organizations Code (“TBOC”) as part of the Texas legislature’s broader initiative to modernize the state’s corporate laws and attract businesses to the state. This follows, and in many ways complements, legislation in 2023 establishing the Texas Business Court to focus on, and accelerate the development of, Texas business law. S.B. 29 codifies the business judgment rule; provides a framework for navigating transactions involving a controlling shareholder; allows corporations to prospectively waive jury trials for internal entity claims and set ownership thresholds for shareholder actions; and allows alternative entities to eliminate fiduciary duties in their governing documents. While the amendments impact both public and private entities, the legislature was particularly focused on publicly traded corporations organized under Texas law (and those that are considering reincorporating in the state). The following provides a brief overview of noteworthy changes.
https://ma-litigation.sidley.com/wp-content/uploads/sites/3/2022/08/sidleyLogo-e1643922598198.png00Yolanda C. Garciahttps://ma-litigation.sidley.com/wp-content/uploads/sites/3/2022/08/sidleyLogo-e1643922598198.pngYolanda C. Garcia2025-05-30 16:11:182025-05-30 16:11:18Texas Seeks to “Seize the Moment” by Enacting Major Changes to Business Organizations Code
On April 14, 2025, the Court of Chancery issued a decision in Siegel v. Morris that reaffirms the limits of challenges to companies’ bylaws based on their language alone. This latest decision (pending appeal) will likely limit bylaw litigation to stockholder claims concerning any bylaw’s actual impact, rather than hypotheticals.
https://ma-litigation.sidley.com/wp-content/uploads/sites/3/2022/08/sidleyLogo-e1643922598198.png00Charlotte K. Newellhttps://ma-litigation.sidley.com/wp-content/uploads/sites/3/2022/08/sidleyLogo-e1643922598198.pngCharlotte K. Newell2025-05-29 11:15:192025-05-29 11:15:19Delaware Courts Continue to Reject Hypothetical, Unripe Bylaw Challenges
Strategies to assist boards in maintaining a balanced approach to governance as they navigate an uncertain, dynamic, and complex regulatory and economic environment.
https://ma-litigation.sidley.com/wp-content/uploads/sites/3/2025/03/MN-18360_Updated-Enhanced-Scrutiny-Blog-imagery_833x606_31.jpg606833Holly J. Gregoryhttps://ma-litigation.sidley.com/wp-content/uploads/sites/3/2022/08/sidleyLogo-e1643922598198.pngHolly J. Gregory2025-05-14 11:34:182025-05-14 11:34:18Board Governance: Maintaining Balance in Uncertainty
https://ma-litigation.sidley.com/wp-content/uploads/sites/3/2022/08/sidleyLogo-e1643922598198.png00Yolanda C. Garciahttps://ma-litigation.sidley.com/wp-content/uploads/sites/3/2022/08/sidleyLogo-e1643922598198.pngYolanda C. Garcia2025-05-08 09:03:412025-05-07 16:53:34Use It or Lose It: Texas Courts Take a Close Look at the Concept of Informal Fiduciary Relationships
A federal criminal case in the Northern District of California raises an unusual scenario involving the interplay between a defendant’s right to counsel of his choice under the Constitution and a corporate officer’s right to advancement of legal fees under Delaware law. Aubrey Shelton is a former senior VP of Delaware corporation RepairPal, Inc. On August 15, 2023, the United States government indicted Shelton on three counts of bank fraud, five counts of wire fraud, and four counts of tax evasion. The indictment alleged that Shelton embezzled millions of dollars from RepairPal over eight years. According to the indictment, Shelton used his control of the company’s payroll account to submit false information about his compensation to the payroll processor, inflating his salary and bonus and representing that he was entitled to receive “executive loans” and “reimbursements” for expenses he did not actually incur. In the criminal proceeding, Shelton sought to have his former employer advance legal fees for his defense, relying on a broad indemnification agreement he had signed with the company in 2020.
https://ma-litigation.sidley.com/wp-content/uploads/sites/3/2024/10/MN-24015-Enhanced-Scrutiny-Blog-Imagery-Refresh_11.jpg606833James Heyworthhttps://ma-litigation.sidley.com/wp-content/uploads/sites/3/2022/08/sidleyLogo-e1643922598198.pngJames Heyworth2025-04-22 09:03:382025-04-21 16:40:09Is There a 6th Amendment Right to Advancement of Legal Fees? In One Unique Case, A Court Says Yes.
2024 was called a “super year” for political elections, with 72 countries and half the world’s population going to the polls. Incumbent political parties across the globe lost these elections at a dizzying rate as voters punished those seen as responsible for inflation and other economic woes. It was also a booming year for shareholder activism, but incumbent directors fared much better than their political counterparts at the ballot box as activists failed to persuade investors of their case for change in proxy contests that went to a vote. With many expecting 2025 to be another “super year” for activism, here is a look at what we observed in 2024. (more…)
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Winding Back the Clock: Delaware Supreme Court Clarifies When Fraudulent Concealment Resets a Contractual Limitations Period
The Delaware Supreme Court recently clarified the circumstances when a fraudulent concealment claim will toll a contractual limitations period. In LGM Holdings, LLC v. Gideon Schurder, et al., the sellers of a pharmaceutical business moved to dismiss the buyers’ claims for breaches of the representations and warranties in the parties’ purchase agreement, arguing they were time-barred by a five-year survival period in the agreement’s indemnification provision. The buyers argued that this five-year period should be tolled under the fraudulent concealment doctrine, but the trial court disagreed, dismissing the claim after finding that fraudulent concealment did not toll the survival period because the buyers had learned of the potential claim within that five-year period. The Delaware Supreme Court reversed the dismissal, and in doing so, offered useful guidance for the pleadings requirements for a fraudulent concealment claim and when fraudulent concealment will apply to a contractual limitations period.
(more…)
Ian M. Ross
Miami
iross@sidley.com
Texas Seeks to “Seize the Moment” by Enacting Major Changes to Business Organizations Code
On May 14, Texas Governor Greg Abbott signed Senate Bill 29 (“S.B. 29”), which amends the Texas Business Organizations Code (“TBOC”) as part of the Texas legislature’s broader initiative to modernize the state’s corporate laws and attract businesses to the state. This follows, and in many ways complements, legislation in 2023 establishing the Texas Business Court to focus on, and accelerate the development of, Texas business law. S.B. 29 codifies the business judgment rule; provides a framework for navigating transactions involving a controlling shareholder; allows corporations to prospectively waive jury trials for internal entity claims and set ownership thresholds for shareholder actions; and allows alternative entities to eliminate fiduciary duties in their governing documents. While the amendments impact both public and private entities, the legislature was particularly focused on publicly traded corporations organized under Texas law (and those that are considering reincorporating in the state). The following provides a brief overview of noteworthy changes.
(more…)
Yolanda C. Garcia
Dallas
ygarcia@sidley.com
George J. Vlahakos
Houston
gvlahakos@sidley.com
Mason Parham
Dallas
mparham@sidley.com
Catherine G. Pritchard
Dallas
cpritchard@sidley.com
Delaware Courts Continue to Reject Hypothetical, Unripe Bylaw Challenges
On April 14, 2025, the Court of Chancery issued a decision in Siegel v. Morris that reaffirms the limits of challenges to companies’ bylaws based on their language alone. This latest decision (pending appeal) will likely limit bylaw litigation to stockholder claims concerning any bylaw’s actual impact, rather than hypotheticals.
(more…)
Charlotte K. Newell
New York
cnewell@sidley.com
Ram Sachs
San Francisco
ram.sachs@sidley.com
Board Governance: Maintaining Balance in Uncertainty
(more…)
Holly J. Gregory
New York
holly.gregory@sidley.com
Use It or Lose It: Texas Courts Take a Close Look at the Concept of Informal Fiduciary Relationships
Under Texas law, there are two categories of fiduciary relationships: formal and informal.
(more…)
Yolanda C. Garcia
Dallas
ygarcia@sidley.com
Mason Parham
Dallas
mparham@sidley.com
Nathan S. Burkes
Dallas
nathaniel.burkes@sidley.com
Is There a 6th Amendment Right to Advancement of Legal Fees? In One Unique Case, A Court Says Yes.
A federal criminal case in the Northern District of California raises an unusual scenario involving the interplay between a defendant’s right to counsel of his choice under the Constitution and a corporate officer’s right to advancement of legal fees under Delaware law. Aubrey Shelton is a former senior VP of Delaware corporation RepairPal, Inc. On August 15, 2023, the United States government indicted Shelton on three counts of bank fraud, five counts of wire fraud, and four counts of tax evasion. The indictment alleged that Shelton embezzled millions of dollars from RepairPal over eight years. According to the indictment, Shelton used his control of the company’s payroll account to submit false information about his compensation to the payroll processor, inflating his salary and bonus and representing that he was entitled to receive “executive loans” and “reimbursements” for expenses he did not actually incur. In the criminal proceeding, Shelton sought to have his former employer advance legal fees for his defense, relying on a broad indemnification agreement he had signed with the company in 2020.
(more…)
James Heyworth
New York
jheyworth@sidley.com
Sheila A.G. Armbrust
San Francisco
sarmbrust@sidley.com
Jaime A. Bartlett
San Francisco
jbartlett@sidley.com
Michael Ferguson
Law Clerk
michael.ferguson@sidley.com
Another “Super Year” for Activism
2024 was called a “super year” for political elections, with 72 countries and half the world’s population going to the polls. Incumbent political parties across the globe lost these elections at a dizzying rate as voters punished those seen as responsible for inflation and other economic woes. It was also a booming year for shareholder activism, but incumbent directors fared much better than their political counterparts at the ballot box as activists failed to persuade investors of their case for change in proxy contests that went to a vote. With many expecting 2025 to be another “super year” for activism, here is a look at what we observed in 2024. (more…)
Kai H.E. Liekefett
New York
kliekefett@sidley.com
Derek Zaba
Palo Alto, New York
dzaba@sidley.com
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