Texas Business Organizations Code

§ 21.556 — DISCOVERY

BO § 21.556Title 2. CORPORATIONS · Ch. 21. FOR-PROFIT CORPORATIONS · Art. L. DERIVATIVE PROCEEDINGS

Statute text

(a)If a corporation proposes to dismiss a derivative proceeding under Section 21.558, discovery by a shareholder after the filing of the derivative proceeding in accordance with this subchapter shall be limited to:

(1)facts relating to whether the person or persons described by Section 21.554 are independent and disinterested;

(2)the good faith of the inquiry and review by the person or group; and

(3)the reasonableness of the procedures followed by the person or group in conducting the review.

(b)Discovery described by Subsection (a) may not be expanded to include a fact or substantive matter regarding the act, omission, or other matter that is the subject matter of the derivative proceeding but the scope of discovery shall not be so limited if the court determines after notice and hearing that a good faith review of the allegations has not been made by an independent and disinterested person or group in accordance with Sections 21.554 and 21.558. Acts 2003, 78th Leg., ch. 182, Sec. 1, eff. Jan. 1, 2006. Amended by:

Legislative history

Acts 2019, 86th Leg., R.S., Ch. 899 (H.B. 3603), Sec. 6, eff. September 1, 2019.