Chancery Rejects ‘Quibbles’ As The Basis For Caremark Claims, Underscoring The Wide ‘Gulph’ Between Imperfect Compliance and Purposeful Lawbreaking

On October 1, 2024, in In re TransUnion Derivative Stockholder Litigation, Vice Chancellor Will in the Delaware Court of Chancery dismissed a derivative suit against the Directors of TransUnion for allegedly breaching their fiduciary duty of oversight in relation to agreements made pursuant to a Consumer Financial Protection Bureau (“CFPB”) consent order.  The Court concluded that Plaintiffs failed to establish a breach under both theories presented, one under Caremark and one under In re Massey Energy, because while the TransUnion Directors may have conducted their oversight duty imperfectly, they did so with a good faith effort.

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