Corporate Boards May Face Higher Legal Hurdle in Risk Oversight

Directors at companies in food, drug, or other highly regulated industries could be forced to ratchet up how they monitor business risks in light of recent Delaware court decisions.

Drugmaker Clovis Oncology Inc.'s directors face a shareholder suit for allegedly ignoring red flags related to a failed lung cancer treatment, after the Delaware Chancery Court let the case proceed. The board of ice cream maker Blue Bell Creameries Inc. failed to dodge a similar suit over a deadly listeria outbreak.

The rulings signal that boards in regulated industries may have a tougher time evading claims of lax oversight, particularly in ...