§ 7-5.3-11 — § 7-5.3-11. Right of action.

§ 7-5.3-11. Right of action.

(a) Except in a benefit enforcement proceeding, no person may bring an action or assert a claim against a benefit corporation or its directors or officers with respect to:

(1) Failure to pursue or create general public benefit or a specific public benefit set forth in its articles of incorporation; or

(2) Violation of an obligation, duty, or standard of conduct under this chapter.

(b) A benefit corporation shall not be liable for monetary damages under this chapter for any failure of the benefit corporation to pursue or create general public benefit or a specific public benefit.

(c) A benefit enforcement proceeding may be commenced or maintained only:

(1) Directly by the benefit corporation; or

(2) Derivatively in accordance with the procedures in § 7-1.2-711 by:

(i) A person or group of persons that owned beneficially, or of record, at least two percent (2%) of the total number of shares of a class or series outstanding at the time of the act or omission complained of;

(ii) A director;

(iii) A person or group of persons that owned beneficially, or of record, five percent (5%) or more of the outstanding equity interests in an entity of which the benefit corporation is a subsidiary at the time of the act or omission complained of; or

(iv) Other persons as specified in the articles of incorporation or bylaws of the benefit corporation.

(d) For purposes of this section, a person is the beneficial owner of shares or equity interests if the shares or equity interests are held in a voting trust or by a nominee on behalf of the beneficial owner.

Legislative History

P.L. 2013, ch. 487, § 1; P.L. 2013, ch. 500, § 1.