2nd Circ. Clarifies Scope Of Discovery In Derivative Suits

Law360, New York (December 9, 2013, 12:23 PM EST) -- In a significant departure from prior rulings, the Second Circuit recently ruled in Halebian v. Berv that a shareholder derivative plaintiff was not entitled to discovery before the trial court decided a special litigation committee’s motion to terminate a shareholder derivative action.[1]

In the oft-cited Joy v. North decision, the Second Circuit ruled that a derivative plaintiff was entitled to discovery before responding to a special litigation committee’s motion to dismiss, and that all documents reviewed by the special litigation committee should be produced.[2]

Since Joy...
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