Derivative action meaning

Tianrui (International) Holding Company v China Shanshui Cement Group (Cayman Islands) [2024] UKPC 36 What are the practical implications of this case? The Privy Council has now articulated the juridical basis on which a shareholder may bring a personal claim to hold a board to the company’s constitution, without resort to a derivative action, following an allotment of shares. As the judgment explains (paras [3]–[4]), authorities of the highest level — from the Privy Council, the UK Supreme Court, the High Court of Australia and other appellate courts — have long recognised that shareholders may proceed personally to contest such allotments, rather than by derivative action on the company’s behalf, notwithstanding that the directors’ duty to exercise the power of allotment for proper purposes is owed to the company alone, not to shareholders individually. Although that personal standing had rarely been doubted, the precise juridical rationale had seldom been determined or even closely discussed; this decision supplies the explanation...

The artists' complaint Filed in California federal court on 3 May 2024, the artists’ lawsuit focuses on Imagen, a text‑to‑image diffusion system that employs machine learning to create pictures from user prompts. Comparable legal actions have been brought against other artificial intelligence (AI) firms, this appears to be the first aimed at Google LLC’s iteration, their counsel told Law360 on 29 April 2024. Matthew Butterick, one of the solicitors for the artists, stated on 29 April 2024 that the pleading outlines another episode of a multi‑trillion‑dollar technology giant opting to train a commercial AI tool on others’ copyrighted material without consent, attribution or payment. The claim asserts that Imagen is trained by duplicating an enormous volume of digital images and extracting protected expression from those works. The artists said it relies on a dataset assembled by the non‑profit Large‑scale Artificial Intelligence Open Network, or LAION. They added: during model training, the images in the dataset are copied in their entirety and wholly absorbed by the system, such that protected...

Boston Trust Company Ltd (in their capacities as trustees of Erutuf Trust) (suing on behalf of Erutuf Trust and all other shareholders in Tellisford Ltd other than VOC Trustee Ltd) v Szerelmey Ltd [2020] EWHC 1352 (Ch) What are the practical implications of this case? As permission to appeal has been granted, it would be premature to attach substantial weight to the ruling. Should the decision survive on appeal, though, it would amount to a practical yet striking enlargement of those entitled to advance common law derivative proceedings. The court acknowledged scenarios in which an applicant can present prima facie material indicating a derivative action has real prospects, but an apparent irregularity means the would‑be claimant presently lacks standing to sue. In that event, the court held it may confer permission conditionally, while remedial steps—such as bringing a rectification claim—are taken to cure the defect. This approach ensures that meritorious derivative claims are not thwarted because an anomaly on the share register strips the intended claimant of locus...

This Practice Note pinpoints, from a practical standpoint, the first matters to assess when an intractable dispute arises between parties to a corporate joint venture (a joint venture company, or JVC), whether a 50-50 vehicle or one with majority and minority participants. Such disagreement can produce managerial deadlock within the JVC, activating the prescribed deadlock resolution procedures set out in the joint venture agreement (JVA). In other instances, the issue may give rise to redress under the Companies Act 2006 (CA 2006) or, potentially, a broader contractual remedy at common law. Scope of this Practice Note on corporate joint venture disputes Where the joint venture (JV) relationship is constituted via a JVC, the primary documents to review when tackling any dispute or issue relating to the JVC are the JVA and the JVC’s articles of association. Although the substance of disputes may resemble those in other JV structures, additional considerations arise that are specific to JVCs. Certain disagreements can result in deadlock that prevents the JVC from functioning...

Rule 38—Setting the scene This Resource Note summarises the key provisions of Rule 38 of The City Code on Takeovers and Mergers (the Code), which governs dealings by connected exempt principal traders. It signposts pertinent materials, commentary and guidance from the Panel on Takeovers and Mergers (the Panel), alongside Lexis+® UK analysis and resources, to offer practical assistance on interpreting and applying Rule 38... Code and Lexis+® UK resources Materials referenced in this Resource Note include: Practice Statements issued by the Panel Executive (the team responsible for day-to-day takeover supervision and regulation) (Executive), giving informal guidance on how the Executive typically interprets and applies the Code Panel Statements (P/S) and Panel Instruments published by the Panel Public Consultation Papers (PCP) and Response Statements (RS) issued by the Code Committee Annual Reports from the Panel discussing broader issues (Annual Reports) Relevant Lexis+® UK resources What it covers Rule 38 concerns dealings carried out by connected exempt principal...

ARCHIVED: This tracker is archived and no longer supported. It presents a catalogue of recent significant judgments delivered in 2023, arranged by subject. Those subjects can be found in the Table of Contents on the left of the page...