“For all the good it may do, the use of electronic communications by directors and officers…may open up new fronts for stakeholders asserting their statutory right to inspect businesses’ books and records and, on the flipside, could potentially create new headaches for businesses…”

In recent years, directors and officers have increasingly embraced the use of electronic communication to decide issues of significance to their businesses. As more and more businesses turn to informal communication tools for their business needs, courts in Delaware, Pennsylvania, and New Jersey have been working to respond to these new developments by both broadening the permissible scope of books and records requests and increasingly scrutinizing such requests to ensure they are narrowly tailored and not overly burdensome.

In this article, Shareholder Jason Levine and Associate Andrew Erdlen examine recent decisions in these states with an eye toward how technological shifts have impacted how courts adjudicate statutory books and records demands. They also discuss potential strategies for the use of, and defense against, those demands.

This article was originally published on Law360.com.

Read the article