Jewelry Co. Fuqi's Board Can't Shake Derivative Suit

Law360, Wilmington (April 26, 2013, 9:32 PM EDT) -- A Delaware Chancery judge on Thursday refused to toss a shareholder derivative complaint aimed at directors of Fuqi International Inc., saying it pled sufficient facts about the China-based jewelry company's lack of internal controls.

Vice Chancellor Sam Glasscock III denied the board's motion to dismiss, finding shareholder George Rich laid out a plausible case that the directors failed to address Fuqi's significant accounting and reporting problems, which caused the company's shares to tumble from a high of $30 to their current value near $1.

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