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Chammas v. NavLink, Inc.

2016 WL 767714 (2016)

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Chammas v. NavLink, Inc.

Delaware Court of Chancery

2016 WL 767714 (2016)

Facts

Directors and former executives George Chammas and Laurent Delifer (plaintiffs) cofounded Delaware corporation NavLink, Inc. (defendant), an information-technology-services company headquartered in Lebanon. Chammas and Delifer claimed the board chairman received a draft of meeting minutes from the secretary months before they did. When Chammas and Delifer requested copies, the chairman and secretary were allegedly unable to find the minutes and lied about their contents. Chammas and Delifer also accused the other directors of falsifying minutes and holding secret pre-board meetings without them and agreeing on courses of action that benefited majority shareholders, who had appointed the other directors, at other shareholders’ expense. The complaint sought four categories of corporate records. The first two sought all documents and communications concerning NavLink between management and the other directors, and between the chairman and other directors. The third sought all documents and communications concerning the preparation of draft board minutes by board secretaries. The fourth sought all documents and communications with major client Saudi Telecom (STC) regarding STC’s request to prematurely terminate contract addenda projected to generate NavLink $27.2 million in annual revenue, as NavLink’s chief executive officer had asked the board to consider the request and NavLink’s options in response.

Rule of Law

Issue

Holding and Reasoning (Noble, J.)

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