Topic: Preclusive

Court of Chancery, Applying Arkansas Law, Precludes Re-Litigation of Demand Futility Issue in the Context of a Derivative Suit Brought by Different Stockholder Plaintiffs

By Josh Gaul and H. Corinne Smith

In In re Wal-Mart Stores, Inc., C.A. No. 7455-CB (Del Ch. May 13, 2016), the Court of Chancery, applying Arkansas law, held that issue preclusion applies to different stockholder plaintiffs in the context of a derivative suit and, therefore, that the Arkansas district court’s holding that demand was not futile precludes re-litigation of the issue in the Delaware court system.

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