(L-R) T. Brad Davey, Mathew A. Golden, and former associate Matthew D. Venuti, of Potter Anderson & Corroon. Courtesy photos
The Delaware legislature has passed a bill to amend Section 102(b)(7) of the General Corporation Law of the State of Delaware to alter the scope of monetary liability for officers of Delaware corporations. Specifically, the amendments extend the opportunity for Delaware corporations to exculpate their officers, in addition to their directors, for monetary liability for certain breaches of fiduciary duty.
The scope of permitted exculpation for officers, however, is not coextensive with the scope of exculpation permitted for directors. Litigators will need to be familiar with the contours of the newly permitted exculpation when determining whether and to what extent a Section 102(b)(7) defense may be available in response to fiduciary claims against officers. This article is intended to provide a practical guide to navigating the recent changes.
