Tola

BACKGROUND

A.

Management of a corporation, including control of any claims it pursues, is vested in its board of directors. (Bader v. Anderson (2009) 179 Cal.App.4th 775, 782.) “When the board refuses to enforce corporate claims, however, the shareholder 1 derivative suit provides a limited exception to the rule that the corporation is the proper party plaintiff.” (Ibid.)

Shareholders face a heavy burden when bringing a shareholder derivative lawsuit. (Brehm v. Eisner (Del. 2000) 746 A.2d 244, 267.) By nature, a derivative suit intrudes on directors’ freedom to manage a corporation’s affairs. (Stone v. Ritter (Del. 2006) 911 A.2d 362, 366 (Stone).) Accordingly, a shareholder may not maintain a derivative lawsuit unless (1) the board has wrongfully refused the shareholder’s demand to pursue a corporate claim, or (2) a demand would be futile because the board cannot make an impartial decision. (Id. at pp. 366-367.) When, as here, the shareholder contends that a demand would be futile, she must plead particularized facts creating a reasonable doubt that the board can impartially consider its merits. (Rales v. Blasband (Del. 1993) 634 A.2d 927, 934; accord, Del. Ch. Ct. Rules, rule…