Board Conduct Amid Financial Distress: New Developments Offer Practical Guidance


Michael Peregrine and William Smith wrote this bylined article on how recent Delaware and federal court decisions give guidance to hospital officers and directors on what may constitute problematic fiduciary conduct during periods of financial distress. The authors wrote that the “basic message” of these decisions to officers and directors is that “you may not have caused the financial problem, but you can still be on the hook if by action (or inaction) you make the problem worse, or if you run from the problem by resigning, leaving the mess for others to clean up.