Directors have a duty to make full and fair disclosure of pertinent information within Board's control

• "... not an independent fiduciary duty, but instead stems from, and is an application of, the general fiduciary duties of care and loyalty"
• Better described as a duty of disclosure rather than the sometimes used duty of candor
• Must disclose all material facts to other directors
• Prevents insiders from using special knowledge
  to their own advantage
• Directors in an interested director transaction should not disseminate false information
  -- even absent stockholder action

Beam v Stewart (Del Ch 2003)

• "The "duty to monitor" is not a separate fiduciary duty, but rather stems from the core fiduciary duties of care and loyalty."  at footnote 16
• Court notes - but does not rule upon - whether this duty stems from the duty of care, the duty of loyalty, or both
• Distinction could prove relevant to application of a company's § 102(b)(7) charter provision

In re Abbot Laboratories  325 F 2d 795 (7^th Cir 2003)

In re Caremark International Inc  698 A 2d 959  967
(Del  Ch  1996)

In re Baxter International 654 A 2d 1268 (Del Ch 1995)

Fiduciary Duties

Delaware General Corporation Law