A recent Delaware Court of Chancery decision acknowledged a pattern of corporations providing directors with advancement rights, and then when those directors attempt to exercise those rights, the corporations resist, claiming that exceptional circumstances exist that require the court to deviate from the principles of law granting advancement, see Nielsen v. EBTH, C.A. No. 2019-0164-MTZ at *2 (Del. Ch. Sept. 30, 2019). In Nielsen, Vice Chancellor Morgan T. Zurn made it clear that few cases present facts that will cause the court to deviate from “Delaware’s standard favoring advancement.”

In Nielsen, the court decided “whether the plaintiffs [were] entitled to advancement of fees and expenses incurred in a separate action. Ultimately, the court held that the plaintiffs were entitled to advancement, reasoning that the plaintiffs were parties to the separate action only “by reason of the fact” they served as directors or officers of the corporation.

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