Lori Marks-Esterman Quoted in Am Law Litigation Daily on When Harm From Corporate Bylaws is Beyond Theoretical

Olshan Chair of Litigation Lori Marks-Esterman was quoted in an Am Law Litigation Daily article (subscription required) on when a court can weigh in on the potential harm caused by a corporate bylaw. In Kellner v. AIM Immunotech, decided in late 2023, the Delaware Court of Chancery issued an opinion reviewing the validity of advance notice bylaws and predicted similar challenges in the future. In April 2025, the Court of Chancery applied Kellner and dismissed a case in an opinion confirming shareholders can only get equitable review of an as-applied bylaw if there is an actual dispute in play. Lori commented that cases post-Kellner have been filed by shareholders in a representative capacity, claiming that a corporation’s advance notice bylaws have a chilling effect on shareholder nominations. But she said in practice, cases challenging advance notice bylaws do not actually get litigated often. “The investor has a choice: hope that the company will waive it, and if they don't, do they want to spend the money and put their own reputation at risk to litigate? In my view, that's not a good result,” Lori said. “If there's no ability for representative shareholders to challenge that provision and you’re not going to see an activist engage to challenge it, then that deterring preclusive bylaw remains."