The Delaware Chancery Court is continuing its trend of permitting Caremark claims against corporate board members who fail to exercise proper oversight and monitoring of compliance programs. Over the past few years, the Delaware Chancery Court has consistently raised the stakes and expectation for Board member performance on corporate boards. In this Episode, Michael Volkov reviews the current board member liability cases and the Court’s recent...

The Delaware Chancery Court is continuing its trend of permitting Caremark claims against corporate board members who fail to exercise proper oversight and monitoring of compliance programs.  The Delaware Court’s latest decision involving the Boeing board and its failure to conduct proper oversight of the 737 MAX safety scandal is yet another example.  At bottom, the Chancery Court is raising the stakes on board member...

Corporate boards will continue to face higher risks of liability.  As the last bastion of legal privilege and protection, the wall of protection is crumbling bit by bit.  Eventually, corporate stakeholders will demand that board members improve performance.  At the core of board member protection from liability is the well-known Caremark doctrine that requires corporate boards to make a good faith effort to implement a...

Corporate board members have an obligation to oversee and monitor a company’s compliance program.  In two recent cases, Delaware courts have tightened the standard governing board liability under the Caremark decision.  Several months ago, in a case involving the Blue Bell Ice Cream listeria outbreak, the Delaware Supreme Court applied a heightened standard when relating to “mission-critical” issues involving food safety to a food company.  In another...