Clarifying D&O Fiduciary Duty To Creditors In Calif.
November 30, 2009, 3:06 PM EST
Law360, New York (November 30, 2009, 3:06 PM EST) -- The Sixth District Court of Appeal, resolving a previously unanswered question in California, has drawn a bright line shielding company directors and officers from personal liability arising from creditor claims of breach of fiduciary duty. Berg & Berg Enterprises LLC v. Boyle, --- Cal. App. 4th ---, 2009 WL 3470631, 09 Cal. Daily Op. Serv. 13, 305 (Oct. 29, 2009).
California has now joined Delaware in holding that directors do not owe creditors a fiduciary duty, even when the corporation is operating in the so-called “zone...