Baker Botts Prevails in Critical Delaware Supreme Court Case

The Delaware Supreme Court, in a precedent-setting decision involving a Dallas corporation, has ruled that a company’s board of directors can legally terminate its chief executive officer and fellow board member at a regularly scheduled board meeting without giving the individual advance notice about the upcoming vote about his or her removal.

Delaware’s high court, in a case that has been monitored closely by corporate general counsel and business lawyers who represent board members, said Friday that Dallas-based Allegro Development Corporation and its board of directors did not violate Delaware law in November 2012 when the board removed Allegro founder and then-CEO Eldon Klaassen because of poor financial performance.