Nevada Supreme Court cites TroyGould treatise
On July 27, 2017, the Nevada Supreme Court issued an important decision in “Wynn Resorts v. the Eighth Judicial District for the State of Nevada, in and for the county of Clark, et al.” which based its ruling in part on Advising & Defending Corporate Directors and Officers (CEB, rev. ed. 2007), written by TroyGould name partners William D. Gould and Joseph F. Troy, now deceased.
The court considered whether a board of directors waived the attorney-client privilege by asserting the business judgment rule as a defense against stockholder claims. The plaintiff-stockholders in the action argued that the business judgment rule applies only to individual directors. In rejecting the argument, the court found that the board of directors had properly invoked the business judgment rule. Quoting Mr. Gould and Mr. Troy, the Court also found that “it is well established that ‘a court that applies the business judgment rule will not ‘second-guess’ a particular decision made by a corporation’s directors or officers if the requirements of the business judgment rule are satisfied.’ As such, ‘[a] court will review the merits of a director’s decision only if’ a plaintiff can ‘rebut the presumption that a director’s decision was valid by showing either that the decision was the product of fraud or self-interest or that the director failed to exercise due care in reaching the decision.’”
The TroyGould family is proud to see its members’ thoughtful legal analysis being relied upon at the highest levels of Nevada’s legal system.