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L-R:Aaron R. Sims,Tyler J. Leavengood, Abraham Schneider and Stephen C. Norman of Potter Anderson & Corroon.Courtesy Photos L-R:Aaron R. Sims,Tyler J. Leavengood, Abraham Schneider and Stephen C. Norman of Potter Anderson & Corroon. Courtesy Photos

The Delaware Supreme Court recently affirmed the Delaware Court of Chancery’s post-trial decision ordering AmerisourceBergen Corp. to produce corporate books and records under Section 220 of the Delaware General Corporation Law (Section 220) in order to permit stockholders to investigate AmerisourceBergen’s role in the distribution of opioids. See, AmerisourceBergen v. Lebanon County Employees’ Retirement Fund, — A.3d –, 2020 WL 7266362 (Del. Dec. 10, 2020). In its opinion, the Supreme Court held that stockholders seeking to investigate possible corporate wrongdoing do not need to state in their inspection demands the uses to which they will put books and records and in most instances do not need to show that the alleged wrongdoing they seek to investigate is “actionable.”

The Supreme Court reiterated the primacy of the credible basis standard, under which a Section 220 plaintiff faces the “lowest possible burden of proof” under Delaware law. AmerisourceBergen appears to reflect a further swing of the pendulum of corporate law toward stockholders in the context of Section 220. Whether the pendulum has shifted too far toward stockholders remains to be seen, but to the extent any corrective action is needed to reverse this trend, it may need to come from the legislature.

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