Vice Chancellor J. Travis Laster’s August 16 post-trial opinion in In re Trados Inc. Shareholder Litigation has attracted a significant amount of attention. Much as both the Chancery and the Delaware Supreme Court did in the Disney/Ovitz case of the mid-2000s, the In re Trados court portrays an extremely deficient board process in vivid and unflattering detail, while ultimately finding - perhaps reluctantly - in favor of the defendants. Disney and In re Trados differ substantially on the factual circumstances as well as the standard of review applied by the courts to the actions in dispute. However, in addition to the similarity of the respective defendant directors escaping liability seemingly by the skin of their teeth, In re Trados like Disney provides an example of how not to manage a board process in a manner designed to avoid disruptive litigation (if not actual liability).
View full article, In re Trados: Directors Dodge a Bullet