August 12, 2022
Boeing will revise bylaws that a Seventh Circuit panel said improperly barred federal derivative claims, ending a dispute with shareholders over alleged proxy misstatements regarding its 737 Max jet that spawned suits in both Illinois federal court and the Delaware Court of Chancery.
If the settlement deal disclosed Wednesday is approved in both Delaware and Illinois, Boeing’s executive and board director insurance will pay the company $6.25 million. Attorneys for Seafarers Pension Plan, which sued on the company’s behalf, will seek up to $4.25 million of that settlement fund in fees and expenses, according to the preliminary approval motion.
Full court approval will also require Boeing’s board of directors to amend its forum-selection bylaw to allow exclusively federal derivative claims from stockholders in either the District of Delaware or the District of Virginia. Boeing announced in May it was moving its headquarters from Chicago to Arlington, Virginia.
That part of the deal is important, the plan said, because it will do away with the company’s current bylaw, which had only allowed such suits in the Delaware Chancery court. That “prevented the federal derivative claims at issue in this case, or any other exclusively federal derivative claim, from being brought,” according to the filing.
. . .
Seafarers is represented in both suits by Cohen Milstein Sellers & Toll PLLC, with Offit Kurman PA serving as local counsel in Delaware.
Read the article on Law360.