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Wal-Mart Rejected by Delaware Supreme Court
On Wednesday, the Delaware Supreme Court backed a ruling from a lower court that has ordered Wal-Mart Stores Inc to provide a shareholder with documents associated to the internal probe of claims that the store paid bribes in Mexico, according to Reuters.
The company appealed the ruling by the Delaware Court of Chancery that ordered the company to provide documents to an Indiana union pension trust. The trust owns the stock for the company. Wal-Mart was sued by the trust for access to the documents. The trust claims it needs the documents to determine if the board breached duties to shareholders by failing to investigate the allegations of bribery in Mexico.
Brooke Buchanan, a spokeswoman for Wal-Mart, said, “The allegations against the company have been the subject of an ongoing, thorough internal investigation that has not yet reached final conclusion.”
Stuart Grant is the shareholder’s attorney. Grant said, “We are very pleased with the result. After almost two years we eagerly await these documents and the truth they will reveal.”
The lawsuit filed by the Indiana Electrical Workers Pension Trust Fund IBEW was filed in Delaware because Wal-Mart is incorporated in the state even though it is based in Bentonville, Arkansas. The company was ordered to provide the shareholders with seven years of documents by then-Chancellor Leo Strine back in 2013.
The ruling by the Delaware Supreme Court was unanimous and it rejected the arguments made by Wal-Mart. The court also ruled that the attorney-client privilege could not protect information in documents that is essential to proving breach of fiduciary duties.Wal-Mart Rejected by Delaware Supreme Court by Jim Vassallo