Cheryl A. Feeley is an Associate in our Washington, D.C. office.
The Maryland Court of Special Appeals recently ruled in Oliveira v. Sugarman, -- A.3d --, 2016 WL 361055 (2016), that a Maryland board's rejection of a shareholder demand is subject to the presumption of the business judgment rule - and not subject to heightened scrutiny - where a majority of disinterested and independent directors rejects the demand.
In Oliveira v. Sugarman, the shareholders of Maryland corporation iStar Financial Inc. demanded that the board of directors investigate and institute claims on behalf of iStar against persons responsible for a decision to modify certain compensation awards to iStar executives. In response to the demand, the iStar board formed a committee consisting of one outside, non-management...
