§ 17-29-905 — Special litigation committee

(a) If a limited liability company is named as or made a
party in a derivative proceeding, the company may appoint a
special litigation committee to investigate the claims asserted
in the proceeding and determine whether pursuing the action is
in the best interests of the company. If the company appoints a
special litigation committee, on motion by the committee made in
the name of the company, except for good cause shown, the court
shall stay discovery for the time reasonably necessary to permit
the committee to make its investigation. This subsection does
not prevent the court from enforcing a person's right to
information under W.S. 17-29-410 or, for good cause shown,
granting extraordinary relief in the form of a temporary
restraining order or preliminary injunction.
(b) A special litigation committee may be composed of one
(1) or more disinterested and independent individuals, who may
be members.
(c) A special litigation committee may be appointed:
(i) In a member-managed limited liability company:
(A) By the consent of a majority of the members
not named as defendants or plaintiffs in the proceeding; and
(B) If all members are named as defendants or
plaintiffs in the proceeding, by a majority of the members named
as defendants; or
(ii) In a manager-managed limited liability company:
(A) By a majority of the managers not named as
defendants or plaintiffs in the proceeding; and
(B) If all managers are named as defendants or
plaintiffs in the proceeding, by a majority of the managers
named as defendants.
(d) After appropriate investigation, a special litigation
committee may determine that it is in the best interests of the
limited liability company that the proceeding:
(i) Continue under the control of the plaintiff;
(ii) Continue under the control of the committee;
(iii) Be settled on terms approved by the committee;
or
(iv) Be dismissed.
(e) After making a determination under subsection (d) of
this section, a special litigation committee shall file with the
court a statement of its determination and its report supporting
its determination, giving notice to the plaintiff. The court
shall determine whether the members of the committee were
disinterested and independent and whether the committee
conducted its investigation and made its recommendation in good
faith, independently and with reasonable care, with the
committee having the burden of proof. If the court finds that
the members of the committee were disinterested and independent
and that the committee acted in good faith, independently and
with reasonable care, the court shall enforce the determination
of the committee. Otherwise, the court shall dissolve the stay
of discovery entered under subsection (a) of this section and
allow the action to proceed under the direction of the
plaintiff.