Removal of a Director

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Removal director

Summary

On July 23, 2011, Damon Kitney from the Australian news wrote an article titled, “The shareholders strike back” which stated how Rupert Murdoch, CEO and chairman combined of the News Corporation, and his firm’s executives, including Mr. Murdoch’s son James, are being investigated for any suspected role in covering up the scope of “industrial scale” phone hacking. Murdoch’s negligent affair has raised many criticisms from experts, lawyers as well as independent management consultants such as Easterbrook, Ian Ramsay. The howls of objection became more strident when Murdoch’s challenging state he himself had no responsibility for what happened. Moreover, Grant & Eisenhofer and Bernstein Litowits Berger & Grossmann filed a consolidated Delaware Chancery Court complaint against the officers and directors of Rupert Murdoch's News Corp, claiming that the board did fail in its work. It is cited through the approval of $615m getting hold of a firm wholly owned by Murdoch’s daughter. Also, they alter the claim to comprise the accusations from the British’s phone hacking and bribe-paying scandal.

Analysis

In the article, regarding to the corporate governance issue which set out the basic rules for corporation which comprise the director duties, it is recognised that News Corporation’s director, Mr. Murdoch has breached the directors’ duties by the Corporations Act (SS 180-184) which are to act with care and diligence and to act in good faith in the best interest of the company. Also, following S 202A, S 203D, S 211, the members had rights and powers to appoint or remove any disqualified directors. This can be applied for this case due to the director had make mistake when doing the phone hacking scandal. Partly similar case “Woonda Nominees v Chng [2000] WASC 173 is referred. Under Corporation Act, section 9 defines that a director is a person who has capacity to affect significantly the corporation’s financial standing. Moreover,...
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