Here, the essence of plaintiffs' entire third amended complaint is that defendants engaged in mismanagement that caused plaintiffs' stock values to decrease. Specifically, plaintiffs allege that defendants engaged in mismanagement by agreeing to the Brown Simpson financing arrangement while ignoring or failing to first inform themselves as to the probable consequences thereof. Accordingly, plaintiffs' complaint is derivative in nature. Plaintiffs argue that they are only required to bring a derivative action in cases involving corporate waste. Plaintiffs argue that there is no allegation of corporate waste here, and therefore their action need not be brought derivatively.
Plaintiffs are incorrect.
The Delaware Supreme Court has held that such claims of shareholder injury are derivative in nature. Plaintiffs argue that count XI of their third amended complaint states a cause of action for breach of contract. In Barbieri , plaintiff alleged that the director defendants manipulated the circumstances surrounding a self-tender offer in order to create a market for defendants to sell their shares. Barbieri is inapposite, as no self-tender offer is alleged here. In Moran , the court held that a shareholder may bring a direct action for breach of contract if the contractual breach involves a wrong to the shareholder and not to the corporation.