In an order granting plaintiffs’ motion for judgment on the pleadings in Schroeder v. Buhannic, C.A. No. 2017-0746-JTL, Order (Del. Ch. Jan. 10, 2018), Vice Chancellor J. Travis Laster held that a provision in a stockholders agreement that purported to limit the board’s authority to select the company’s chief executive officer was ineffective because it conflicted with the Delaware General Corporation Law.

Plaintiffs sought a declaratory judgment pursuant to Section 225 that a consent executed by the holders of a majority of the common stock of TradingScreen Inc., intending to make changes to the composition of the management and board of directors of the company, was ineffective in light of the company’s governing documents, including the company’s charter, bylaws and a stockholders agreement entered into by all of the company’s preferred and common stockholders.