[Until this opinion appears in the Ohio Official Reports advanc e sheets, it may be cited as Reister v. Gardner , Slip Opinion No. 2020-Ohio-5484.]

NOTICE This slip opinion is subject to f ormal revision before it is pu blished in an advance sheet of the Ohio Official Reports. Readers are reques ted to promptly notify the Reporter of Decisions, Supreme Court of Ohi o, 65 South Front Street, Columbus, Ohio 43215, of any typographical or other formal errors in the opinion, in order that corrections may be made before the opinion is published.

S LIP O PINION N O
. 2020-O HIO -5484
R EISTER , R ECEIVER , A PPELLANT , v. G ARDNER ET AL , A PPELLEES ;

C LARKWESTERN D IETRICH B UILDING S YSTEMS , L.L.C., D . B . A
. C LARK D IETRICH , A PPELLANT
. [Until this opinion appears in t he Ohio Official Reports advanc e sheets, it

may be cited as Reister v. Gardner , Slip Opinion No. 2020-Ohio-5484.] Corporations—Directors—Breach-of-fi duciary-duty claims—The businessjudgment rule and the litigation privile ge are separate concepts—Motions for judgment on the pleadings—Complaint was sufficient to state actionable
claims that should not have been dismissed. (No. 2019-1815—Submitted August 5, 2020—Decided December 3, 202 0.)
A PPEAL from the Court of Appeals for Butler County, Nos. CA2019-01-01 0, CA2019-01-011, and CA2019- 01-020, 2019-Ohio-4720.

__________________ F ISCHER , J. {¶ 1} The law is a large and sometimes complicated field. It is made less complicated by the fact that litigants, lawyers, and judges ali ke may look toS UPREME C OURT OF O HIO

2 precedent for guidance. The Federalist No. 78 at 471 (Alexande r Hamilton) (Clinton Rossiter Ed.1961). From time to time, however, discre te concepts are nonetheless confused, and the cl arity provided by prior decisio ns gets muddied.
This case involves one such instance of confusion. Because the Twelfth District Court of Appeals conflated the litigation privilege with the bu siness-judgment rule in its decision affirming the trial court’s decision to grant j udgment on the pleadings, we clarify the separate nature of these rules, and w e reverse the Twelfth District’s judgment.
I

. FACTUAL AND PROCEDURAL BACKGROUND {¶ 2} Appellant, ClarkWeste rn Dietrich Building Systems, L.L.C., d.b. a. ClarkDietrich, previously sued the Certified Steel Stud Associa tion, Inc. (“the association”), a Delaware corpor ation, and its member companies . That lawsuit primarily alleged that the associ ation made defamatory statemen ts about the quality of ClarkDietrich’s products in a trade publication that the ass ociation published and disseminated. Appellees, William Gardner and Edward Slish, wer e members of the
association’s board of directors at that time. {¶ 3} As relevant here, ClarkDietrich’ s defamation case proceeded to a lengthy jury trial. During that trial, ClarkDietrich settled i ts claims against each of the association’s member companies and offered to dismiss its r emaining claims against the association with p rejudice. The association’s boar d, however, voted to reject that offer, apparently in part due to concerns about rel ated litigation that were not addressed by the offer. Cla rkDietrich, satisfied that it h ad been vindicated by the settlements it had already reached, then filed a motion wit h the trial court to dismiss the case with prejudice. The association opposed this request and asked the trial court to deny the motion. The trial court granted th e association’s request, denying ClarkDietrich’s motion a nd allowing the case to proceed . Eventually, in what can only be described as a “be careful what you wish for” turn of events, the jury returned a unanimous verdict in favor of ClarkDietrich alo ng with a $49.5January Term, 2020

3 million judgment. The associati on was ultimately responsible f or $43 million of
that amount. {¶ 4} After the judgment was subse quently affirmed on appeal, Clarkwestern Dietrich Bldg. Sys., L.L. C. v. Certified Steel Stud Assn., Inc. , 12th Dist. Butler No. CA2016-06-113, 2017- Ohio-2713, ClarkDietrich m oved the trial court to appoint a receiver on behalf of the association so tha t the association could pursue potential breach-of-fiduciary-duty claims against the di rectors and could obtain the funds it needed, in whole or in part, to satisfy the considerable judgment. The trial court granted the mo tion and appellant, John J. Reist er, was appointed as
the receiver. {¶ 5} After his appointment as receive r, Reister filed this action ag ainst the association’s four directors, including Gardner and Slish, and designated ClarkDietrich as an interested p arty. The complaint alleged th at the directors breached their fiduciary duties by mishandling the ClarkDietric h litigation and rejecting multiple oppor tunities to resolve the case at no cost to the association. Arguing that their actions were protected by the litigation pri vilege, Gardner and Slish each moved for judgment on the pleadings. The trial cour t agreed with Gardner and Slish and granted those motions. {¶ 6} On appeal, the Twelfth District Court of Appeals affirmed the t rial court’s judgment. According to the Twelfth District, “[t]he ac tions taken and statements made by Gardner and Slish in the underlying matter [ were] protected and provided immunity under the litigation privilege rule.” 20 19-Ohio-4720, 149 N.E.3d 112, ¶ 27. Like the trial c ourt, the Twelfth District d etermined that the litigation privilege is broad and immunizes “ ‘actions’ as oppo sed to merely
‘statements.’ ” Id. at ¶ 25. The Twelfth District accordingly reasoned that the r ule is applicable to a corporate board of directors’ decision to fo rgo settling a case. Id. at ¶ 26. Judge Stephen Powell di ssented and observed that the litigation privilegeS UPREME C OURT OF O HIO

4 is narrower in scope than either the trial court or the majorit y had acknowledged.
Id. at ¶ 37-42 (Powell, J., dissenting). {¶ 7} Following the Twelfth District ’s split decision, Reister and ClarkDietrich separately appealed here and we accepted their ap peals. See 158 Ohio St.3d 1434, 2020-Ohio-877, 141 N.E.3d 242.
II. ANALYSIS {¶ 8} The central issue in this appeal is the proper scope of the lit igation privilege in Ohio. The litigation privilege provides absolute immunity to parties, witnesses, lawyers, and judges from future lawsuits for statements made during and relevant to judicial proceedings. Erie Cty. Farmers’ Ins. Co. v. Crecelius , 122 Ohio St. 210, 171 N.E. 97 (1930), syllabus; Willitzer v. McCloud , 6 Ohio St.3d 447, 448- 449, 453 N.E.2d 693 (1983); Surace v. Wuliger , 25 Ohio St.3d 229, 495 N.E.2d 939 (1986), syllabus; Hecht v. Levin , 66 Ohio St.3d 458, 460, 613 N.E.2d 585 (1993). To be clear, it still does that. {¶ 9} Contrary to 90 years of precedent, however, the court of appeal s applied the litigation privilege to actions rather than stateme nts when it held that the litigation privilege shielded the business decisions of the corporate directors in this case. The court justified this departure from our precede nt by looking to Florida law, see Levin, Middlebrooks, Mabie, T homas, Mayes & Mitchell, P.A. v.
United States Fire Ins. Co. , 639 So.2d 606, 608 (Fla.1994), and importing concepts borrowed from the business-judgme nt rule. Specifically, the Tw elfth District stated that it was “contrary to the purposes of the litigation privile ge rule to second-guess the litigation strategy employed by the directors and the Assoc iation’s counsel” and that “[c]onsistent with the purposes of the litigation privileg e rule, directors Slish
and Gardner should be free to use their best judgment in defend ing the underlying lawsuit without fear of having to defend their action in a subs equent civil action for those decision[s].” 2019-O hio-4720, 149 N.E.3d 112, at ¶ 29.January Term, 2020

5 {¶ 10} We respectfully reject the dete rmination by the court of appeal s and clarify that in this case, Ohio law, not Florida law, controls and defines the contours of the litigation privilege. In doing so, we reaffirm our long -established rule that the litigation privilege provides absolute immunity from civil suits for defamatory

statements made during and relevant to judicial proceedings. Willitzer at 448-449;
Crecelius at syllabus. We further clarify that the business-judgment ru le and the litigation privilege are, in f act, discrete concepts. {¶ 11} Because this case involves a Delaware corporation and litigatio n that took place in Ohio, we apply Ohio law to define the litigation privilege and we look to Delaware law to define the directors’ fiduciary duties and t he business-judgment rule, see Gries Sports Ents., Inc. v. Cleveland Browns Football Co., Inc. , 26 Ohio St.3d 15, 20, 496 N.E.2d 959 (1986). Reviewing the pleadings i n this case under the guiding principles established by the applicable law, we ho ld that judgment on the pleadings was improper. A. Distinguishing Between the Litigation Privilege and the Business-Judgment Rule {¶ 12} The business-judgment rule is “a presumption that in making a
business decision the directors of a corporation acted on an in formed basis, in good
faith and in the honest belief th at the action taken was in the best interests of the company.” Aronson v. Lewis, 473 A.2d 805, 812 (Del.1984), overruled on other grounds , Brehm v. Eisner , 746 A.2d 244, 254 (Del.2000). It is a recognition that judges, with the benefit of hindsight, should not second-guess the numerous and difficult real-time choices that corporate officers and directo rs are faced with, Sinclair Oil Corp. v. Levien , 280 A.2d 717, 720 (Del.1971), unless, of course, the presumption that the officers and directors acted in accordance with their fiduciary duties is rebutted, Aronson at 812. {¶ 13} The business-judgment rule is not unique to specific transactio ns and applies to any decision made pur suant to the directors’ authori ty under DelawareS UPREME C OURT OF O HIO

6 law. Zapata Corp. v. Moldanado , 430 A.2d 779, 782 (Del.1981). Accordingly, the business-judgment rule may apply to the decisions that director s make in connection with litigation involvi ng the corporation they serve

. Id. (“managerial decision making power * * * encompasses decisions whether to in itiate, or refrain from entering, litigation”). This necessarily means that the b usiness-judgment rule may apply to decisions regarding the settlement of a lawsuit. See, e.g. , White v.
Panic , 783 A.2d 543, 552 (Del.2001) (“The decision to approve the se ttlement of a suit against the corporation is entitled to the same presumptio n of good faith as
other business decisions taken b y a disinterested, independent board”). {¶ 14} The litigation privilege, by contrast, is designed to protect “ the integrity of the judicial process” by affording participants in litigation with immunity from future lawsuits over relevant statements made during judicial proceedings. Willitzer , 6 Ohio St.3d at 449, 453 N.E.2d 693. By removing the fear of future consequences, the litigation privilege facilitates the disclosure of “pertinent information” and helps to “ascertain the truth.” Id. The litigation privilege is therefore applicable to statements that bear “some reasonable relation to the judicial proceeding in which” they appear. Surace , 25 Ohio St.3d 229, 495 N.E.2d 939, at syllabus. It is not applicable, however, to con duct that is simply connected in some way to litigation. Willitzer at 449-450 (concluding that the litigation privilege shielded a physician from liability arisin g from his testimony in judicial proceedings but not from claims arising from the manne r in which he conducted examinations). Conse quently, the litigation privileg e has nothing to do
with the decisions that corporate directors make during litigation. {¶ 15} So, while the business-judgment rule may apply to the decisions that directors make during the cour se of litigation involving the co rporation they serve (and there may even be additional statutory protections for tho se directors when their decisions are informed by the advice of counsel, see Del.Code Ann., Title 8, 141(e)), the litigation privilege i s entirely distinct. Again, the litigation privilegeJanuary Term, 2020

7 protects participants in litigation from future suits over statements made during the litigation. The business-judgment rule, on the other hand, is a standard of review
that affords deference to the decisions that informed and confl ict-free directors make while managing the affairs of a corporation, including dec isions regarding litigation. B. Judgment on the Pleadings Was Improper {¶ 16} Having clarified that the litigation privilege protects stateme nts, not actions, and is a concept separa te from the business-judgment r ule, we turn to the pleadings in this case and consider whether the decision to gra nt judgment on the pleadings was proper. {¶ 17} Our review of a judgment on the pleadings is de novo. New Riegel Local School Dist. Bd. of Edn. v. Bu ehrer Group Architecture & Eng., Inc. ,157 Ohio St.3d 164, 2019-Ohio-2851, 133 N.E.3d 482, ¶ 8. Dismissal is appropriate under Civ.R. 12(C) when (1) the court construes as true, and in favor of the nonmoving party, the material allegations in the complaint and all reasonable
inferences to be drawn from t hose allegations and (2) it appear s beyond doubt that the plaintiff can prove no set of facts that would entitle him or her to relief. State ex rel. Midwest Pride IV, Inc. v. Pontious , 75 Ohio St.3d 565, 570, 664 N.E.2d 931 (1996). {¶ 18} The complaint in this case alleges that the directors owed the association certain fiduciary du ties, that the directors breach ed those duties as a result of their handling of the litigation involving the associ ation, and that the alleged breach of those duties da maged the association. The co mplaint specifically alleges that the directors were conflicted due to their positio ns as employees of other corporations that were competitors of ClarkDietrich and t hat the decisions
that the directors made here we re, as a result, irrational and not in the best interest of the association. In light of those alleged facts and others , the complaint goes on to allege that these decisions w ere not a vali d exercise of bus iness judgment.S UPREME C OURT OF O HIO

8 {¶ 19} Considering the applicable standa rd of review and the fact that a litigant need only include “a short and plain statement of the claim showing that the party is entitled to relief,” Civ.R. 8(A), the complaint here w as sufficient to state actionable claims against Gardne r and Slish that should not hav e been dismissed. The litigation privilege does not change this, and, based on th e pleadings, it is premature to say whether the business-judgment rule will apply here. Accordingly, judgment on the pleadings was inappropriate.
C. Remand {¶ 20} Given our resolution of the issues presented here, remand to th e trial court is necessary. In light of the confusion below, we note t hat our decision is specific only to this stage of the proceedings. While we have clarified that the litigation privilege and the business-judgment rule are separat e concepts and that judgment on the pleadings was improper at the time it was enter ed, nothing in our decision should be construed as passing judgment on the merits of this case or on whether the business-judgment rule will apply at later stages o f these proceedings. That issue, the application of the business-judgment rule at th ose later stages, and
the outcome of this case should be decided on remand.
III. Conclusion {¶ 21} For the reasons stated above, we reverse the judgment of the co urt of appeals and remand this cause t o the trial court for further proceedings consistent with this opinion. Judgment reversed
and cause remanded.
O’C ONNOR , C.J., and K ENNEDY , F RENCH , D E W INE , and D ONNELLY , JJ.,

concur. S TEWART , J., concurs in judgment only.

_________________January Term, 2020

9 Helmer, Martins, Rice & Popham Co., L.P.A., James B. Helmer Jr ., Robert M. Rice, Jennifer L. Lambert, and B. Nathaniel Garrett; and Mil likin & Fitton Law Firm, Steven A. Tooman, and Heather Sanderson Lewis, for appell ant John J.
Reister. Frost Brown Todd, L.L.C., and Ma thew C. Blickensderfer; and Co hen & Grigsby, P.C., Anthony M. Cillo, and Fridrikh V. Shrayber, for appellant ClarkWestern Dietrich Building Systems, L.L.C. Dinsmore & Shohl, L.L.P., Brian S. Sullivan, Peter J. Georgito n, and Justin M. Burns; and Chamberlain, Hrdlicka, White, Williams & Aughtry, Scott M. Ratchick, and John C. G uin, for appellee Edward R. Slish. Taft, Stettinius & Hollister, L.L.P., Daniel R. Warncke, and A aron M. Herzig; and Fox Rothschild, L.L.P., Jeffrey M. Pollock, and Rob ert J. Rohrberger, for appellee William A. Gardner. Squire Patton Boggs, L.L.P, Lauren S. Kuley, and Benjamin Beat on; and Kevin D. Shrimp, urging affirmanc e for amicus curiae, Ohio Cham ber of
Commerce.

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