Aronson v. Lewis
Delaware Supreme Court
473 A.2d 805 (1984)
Relevant factsFree
Lewis (plaintiff) sued Meyers's directors (defendants) over an employment agreement and interest-free loans to major shareholder-director Fink, without first demanding the board pursue the claim, arguing demand was futile because Fink personally selected the directors and any suit would require them to sue themselves; the Court of Chancery denied a motion to dismiss, finding the allegations undermined business-judgment-rule protection.
IssueFree
Whether a court may dismiss a shareholder's derivative action if the shareholder has failed to make a demand on the board or allege facts sufficient to demonstrate that such a demand would be futile.