Facts

Laborers' Local #231 Pension Fund filed a derivative suit against executives and directors of Intersil Corp., a semiconductor company in relation to the approval of an executive pay increase that occurred in the face of a poor economic situation and a negative say-on-pay vote.

PLAINTIFF'S CONTENTIONS:
Plaintiff alleged that defendants were in breach of their fiduciary duty when they gave approval to a 42 percent executive pay increase even though there had been poor financial performance and a negative say-on-pay vote. Further, plaintiff alleged that defendants were not disinterested in that they could profit from the pay plan or could be liable for approval.

DEFENDANTS' CONTENTIONS:
Defendants argued that plaintiff's claims were insufficient because plaintiff failed to prove that making a pre-suit demand on the board would have been futile. Further, defendants argued that plaintiff failed to clear the hurdle of a Delaware presumption that defendants exercised good faith business judgment in the approval of the plan.

Result

The judge dismissed the lawsuit without prejudice.

Other Information

Plaintiff intends to file an amended complaint.