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Delaware Chancery Court Orders Disclosure of Special Committee’s Privileged Communications in Stockholder Derivative Suit

December 12, 2007


On Nov. 30, the Delaware Court of Chancery held that the plaintiffs in a shareholder derivative action were entitled to receive in discovery information relating to a Special Committee’s report of the findings of an internal investigation made to the company’s full Board of Directors, as well as communications between the Special Committee and its counsel. The decision in Ryan, et al. v. Gifford, et al., Civ. Act. No. 2213-CC, 2007 WL 4259557 (Del. Ch. Nov. 30, 2007), by Chancellor William B. Chandler III, rejected the arguments made by the company that the information was protected from disclosure by the attorney-client privilege. 

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