Shocking Technologies, Inc. v. Kosowsky

Delaware Court of Chancery

2012 WL 4482838 (2012)

Relevant factsFree

Shocking Technologies (STI) faced dire financial straits with only one remaining prospective investor, Dickinson, whose investment was essential to the company's survival, but STI director Simon Michael believed it would ultimately be better for both himself and STI if Dickinson didn't invest, and disclosed confidential company information to Dickinson specifically hoping to dissuade the investment. Michael was sued in the Delaware Court of Chancery for breach of his fiduciary duty of loyalty.

IssueFree

Whether a director breaches the fiduciary duty of loyalty by taking steps that would foreseeably put the company in dire financial circumstances.

Holding & reasoning

The court resolved the question by applying the controlling rule to the facts and explaining precisely why the outcome followed. Its reasoning ties the doctrine to the record so you can reproduce the analysis on an exam.

Procedural history, concurrence & dissent

This section traces the case from the trial court through appeal and lays out how each opinion lands. Separate writings sharpen the majority's limits and flag the arguments most likely to resurface in class.

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