In re Oracle Corp. Deriv. Litig.,
C.A. No. 2017-0337-SG (Del. Ch. Dec. 28, 2023)
By rule, the prevailing party in Court of Chancery litigation is
entitled to shift costs to the losing party, subject to the
Court's discretion. Here, in an unordinary derivative action,
the Court declined to shift the costs of the prevailing individual
defendants to the derivative plaintiffs. The plaintiffs had
overcome a motion to dismiss, which led to the appointment of a
special litigation committee by the company's board. While the
special committee had the power to seek dismissal, the committee
determined that the derivative plaintiffs should be allowed to
prosecute the claims on the company's behalf. The plaintiffs
ultimately lost after trial. As a result, the individual defendants
were entitled to indemnification by the company, including for
costs. The Court cited these circumstances as grounds for invoking
equity to decline shifting costs via rule to the derivative
plaintiffs.
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