Of Mice and Men: The Business Judgment Rule After The <i>Disney </i>Decision

Last month, we discussed the Delaware Court of Chancery decision in <i>In re The Walt Disney Co. Derivative Litigation</i>, 2005 WL 2056651 (Del. Ch. Aug. 9, 2005), a case that had drawn intense media attention (The case currently is on appeal to the Delaware Supreme Court.) We noted that the severance package given Disney president Michael Ovitz amounted to approximately $140 million in cash and vested stock options, which was paid to Ovitz upon the termination of his employment under a "no-fault" termination provision in his employment agreement. The court found that no Disney board member was liable for violating his or her fiduciary duties with respect to the hiring, and then the firing after a little more than 1 year, of Michael Ovitz. Now the question is: What has been learned? We continue the article with a discussion of fiduciary conduct.

26 minute readJanuary 26, 2006 at 12:16 PM
By
David L. Finkelman
David I. Schultz
Of Mice and Men: The Business Judgment Rule After The <i>Disney </i>Decision

Last month, we discussed the Delaware Court of Chancery decision inIn re The Walt Disney Co. Derivative Litigation, 2005 WL 2056651 (Del. Ch. Aug. 9, 2005), a case

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