Bloomberg Law
Jan. 30, 2023, 8:00 PM

Brookdale Investors’ Allegations of Retirement Home Neglect Cut

Martina Barash
Martina Barash

Brookdale Senior Living Inc. shareholders can proceed with just one claim in a derivative suit accusing company directors of adopting a strategy that resulted in poor staffing and ultimately financial harm to the company.

The rest of the claims must be dismissed because the investors didn’t ask the board to sue first, and didn’t show that such a demand would have been futile, Judge Aleta A. Trauger said Jan. 27 for the US District Court for the Middle District of Tennessee.

The decision highlights distinctions in the law of Delaware, where Brookdale is incorporated, about how to show demand futility. ...