In Kokocinski v. Collins, 850 F.3d 354 (8th Cir. 2017), the Eighth Circuit Court of Appeals affirmed the dismissal of Charlotte Kokocinski’s (“Plaintiff”) shareholder derivative action against Medtronic’s directors and officers (“Defendants”) and the Special Litigation Committee formed by Medtronic (“SLC”). The court held that the District Court did not abuse its discretion because Defendants properly formed the SLC, the SLC was entitled to discretion under the Business Judgment Rule (“BJR”), and the District Court exercised sound discretion in concluding discovery was not necessary.
Read MoreThis post is part of an ongoing series that examines the way stock exchange independence rules relate to director compensation. We are for the most part including companies from 2017’s Fortune 500 and using information found in their 2017 proxy statements.
NASDAQ and the NYSE have similar rules with respect to director independence. NYSE Rule 303A.01 requires that each listed company’s board of directors be comprised of a majority of independent directors. A director does not qualify as “independent” if he or she has a “material relationship with the company.” NYSE Rule 303A.02(a).
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