The Elusive Promise of Reducing Shareholder Litigation Incentives Through Corporate Bylaws

Corporations today are routinely subject to expensive shareholder litigation for which shareholders ultimately foot the bill.  Even weak shareholder claims pose significant costs and uncertainty, and exert significant settlement pressures, on corporations.  Several recent state court decisions, however, underscore the potential for corporate bylaws, including those adopted by boards, to reduce incentives for plaintiffs' bar to file such lawsuits.