Delaware Court Denies Motions to Dismiss in Two Shareholder Derivative Actions Challenging Timing of Stock Option Grants
By Kevin C. Logue, Barry G. Sher, Thomas A. Zaccaro and James W. Gilliam
On February 6, 2007, Chancellor Chandler of Delaware’s Court of Chancery issued two important decisions relating to the purported manipulation of stock option grant dates. In both cases the court denied the defendants’ motions to dismiss in large part. Given the prominence of Delaware’s Court of Chancery in corporate matters, these decisions deserve careful analysis, and may provide useful lessons and insights in future stock option litigation.