Claybrook v. Morris (In Re Scott Acquisition Corp.)

How courts have described this case

Verbatim parenthetical descriptions written by other courts when citing this decision. Ranked by citation-network relevance.

• holding that directors and officers of an insolvent wholly owned subsidiary owe fiduciary duty to the subsidiary and its creditors
• noting that directors of an insolvent subsidiary cannot, with impunity, permit the subsidiary to be plundered for the benefit of the parent
• “a director’s fiduciary duty to creditors is derivative of the duty owed to the corporation”
• Under Delaware law, \upon insolvency directors of a wholly-owned subsidiary owe fiduciary duties to the subsidiary and its creditors.\
• “a director’s fiduciary duty to creditors is derivative of the duty owed to the corporation”
• “There is no basis for the principle ... that the directors of an insolvent subsidiary can, with impunity, permit it to be plundered for the benefit of its parent corporation”

Source: CourtListener parenthetical corpus (CC0).