## Facts

- A News Corporation stockholder sought to inspect corporate books and records under 8 Del. C. § 220 to investigate alleged fiduciary breaches tied to News Corp.’s acquisition of Shine Group Ltd.
- The stockholder delivered a written § 220 demand and, on the same day, filed both a § 220 enforcement action in the Court of Chancery and a separate derivative action challenging the transaction as unfair in price and process.
- The § 220 demand letter misidentified the corporation whose records were sought.
- The demand inconsistently described the stockholder as both a record owner and a beneficial owner of the shares.
- The demand did not include sworn documentary proof of beneficial ownership with the demand; proof was supplied only later during litigation.

## Issues

1. Whether the mere pendency of a contemporaneously filed derivative action categorically prevents a stockholder from showing a “proper purpose” for inspection under 8 Del. C. § 220.
2. Whether the stockholder’s demand complied with § 220’s statutory “form and manner” requirements, including correct identification of the corporation, clear ownership status, and sworn proof of beneficial ownership provided with the demand.

## Decision

- The Delaware Supreme Court declined to adopt a broad rule that a pending derivative action automatically defeats a proper-purpose showing under § 220.
- The court nonetheless affirmed dismissal of the § 220 action on alternative grounds: the demand failed to satisfy § 220’s technical prerequisites.
- The court held the demand’s defects—including naming the wrong entity, ambiguous ownership assertions, and omission of sworn beneficial-ownership proof with the demand—were fatal and could not be cured through later submissions in the litigation.

## Legal Principles

- Section 220 is a statutory inspection remedy whose “form and manner” requirements are strictly construed and must be satisfied as a condition to relief.
- A stockholder must accurately identify the corporation whose records are sought and clearly state whether it is a record owner or a beneficial owner.
- A beneficial owner must provide sworn documentary evidence of ownership with the demand; supplying proof later in a § 220 enforcement action is insufficient.
- The filing or pendency of a derivative action does not, by itself, create a categorical bar to establishing a proper purpose for § 220 inspection; the inquiry is contextual.
- Courts remain skeptical of § 220 demands that function as substitute discovery for already-filed plenary litigation.

## Conclusion

The Delaware Supreme Court affirmed dismissal of the stockholder’s § 220 action because the demand did not strictly comply with statutory demand formalities, while rejecting the Court of Chancery’s categorical view that a concurrently pending derivative action generally forecloses a proper purpose for inspection.


Cent. Laborers Pension Fund v. News Corp., 45 A.3d 139 (Del. 2012)