Bill Text: TX HB4794 | 2023-2024 | 88th Legislature | Introduced
Bill Title: Relating to the burden of proof in certain derivative proceedings.
Spectrum: Partisan Bill (Republican 1-0)
Status: (Introduced - Dead) 2023-03-22 - Referred to Judiciary & Civil Jurisprudence [HB4794 Detail]
Download: Texas-2023-HB4794-Introduced.html
| 88R13333 SRA-D | ||
| By: Harrison | H.B. No. 4794 | |
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| relating to the burden of proof in certain derivative proceedings. | ||
| BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
| SECTION 1. Subchapter L, Chapter 21, Business Organizations | ||
| Code, is amended by adding Section 21.5525 to read as follows: | ||
| Sec. 21.5525. BURDEN OF PROOF IN CERTAIN DERIVATIVE | ||
| PROCEEDINGS. Notwithstanding any other law, in a derivative | ||
| proceeding by a shareholder that alleges an act or omission related | ||
| to the improper consideration of environmental, social, and | ||
| governance criteria in the performance of the act or omission, the | ||
| burden of proof is on the corporation to prove the act or omission | ||
| was in the best interest of the corporation. | ||
| SECTION 2. Section 21.5525, Business Organizations Code, as | ||
| added by this Act, applies only to an action commenced on or after | ||
| the effective date of this Act. An action commenced before the | ||
| effective date of this Act is governed by the law as it existed | ||
| immediately before the effective date of this Act, and the former | ||
| law is continued in effect for that purpose. | ||
| SECTION 3. This Act takes effect September 1, 2023. | ||
