Delaware County Employees Retirement Fund, City of Roseville Employees’ Retirement System, and Robert Friedman…

Summary

The court reversed dismissal of a shareholder derivative complaint because the plaintiffs pled particularized facts creating a reasonable doubt that director Alan Jackson could act independently of an interested director. The court held that the trial court was required to evaluate Jackson’s longstanding friendship, employment ties, family ties, and related economic relationships in their totality and draw reasonable inferences for the plaintiffs. Because those facts supported demand excusal under the first prong of the governing demand-futility test, the derivative action could proceed.