In 2017, the Supreme Judicial Court of Massachusetts clarified the question of directors’ fiduciary duty under Massachusetts corporate law and, in so doing, distinguished the state’s corporate governance law from Delaware’s.
In IBEW Local No. 129 v. Tucci, the Court held that a Massachusetts director’s duty is owed solely to the corporation. However, the court noted in the decision that duties may be owed among shareholders in close corporations and when “a controlling shareholder who also is a director proposes and implements a self-interested transaction that is to the detriment of minority shareholders.”
Tucci did not further address duties to shareholders in such situations because the case did not involve a close corporation or a controlling shareholder. However, another Massachusetts case that was being tried to a jury just as the Tucci decision issued involved an allegation that the Massachusetts corporation PHC was dominated by a controlling shareholder who had breached a duty to other shareholders.
In the 2018 update to the Special Commentary to Massachusetts Laws Governing Business Entities, Massachusetts attorney Kurt Hemr of Skadden Arps provides an analysis of the PHC case and its implications for Massachusetts corporations and their boards of directors.
Massachusetts Laws Governing Business Entities
CSC’s Massachusetts Laws Governing Business Entities is the most comprehensive collection of annotated Massachusetts business statutes available.
The 2018 Edition is updated through Chapter 86 of the 2018 Massachusetts legislative session and features over twenty new case annotations from Massachusetts courts. Also included are five full-text cases covering recent legal developments regarding formation of an LLC, alter ego, fiduciary duty and deadlock.
The 2018 Edition also includes the 2017 Special Commentary Section which explores how Massachusetts corporate governance law differs from Delaware law, as well as the 2018 Update.
Other features include the Massachusetts Business Fee Schedule and a companion CD-ROM containing more than 160 Massachusetts forms for incorporation/formation, qualification, mergers, dissolution, and name reservation for all entity types. A listing of the forms and contact information for the Massachusetts Division of Corporations can be found in Appendix C.
Massachusetts Laws Governing Business Entities is available as a softbound book or as an ebook, compatible with dedicated e-reader devices, computers, tablets and smartphones that use e-reader software or applications. It is also available on the LexisNexis Digital Library.
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