Securities Regulation Daily Wrap Up, CORPORATE GOVERNANCE—Del. Ch.: Board improperly removed officers at bait-and-switch meeting, (Oct 22, 2025)

By R. Jason Howard, J.D.

The meeting notice was inequitable and “the actions taken in reliance on it are voidable acts.”

The Delaware Chancery Court has entered judgment for the defendants, two directors of Altumind Inc., after finding that a board meeting notice omitted the fact that the defendants’ removal would be considered (Ghatty v. Mudili, No. 2025-0615-LWW (Del. Ch. Oct. 21, 2025)).

Altumind Inc. provides back-office operations and IT-related consulting and services to corporations. The plaintiffs in the case are three directors of Altumind’s five-member board who purported to remove the two defendant directors from their officer roles at a board meeting. The defendants challenged their removals for numerous reasons, but the court only needed to focus on the meeting notice, which complied with the company’s bylaws but “omitted that the defendants’ removals would be considered—and even suggested that one would assume an expanded officer role.”

The court stated that although the notice technically complied with Altumind’s bylaws, “it was not necessarily equitable as it was a ‘bait-and-switch’ that concealed the plaintiffs’ intention to remove them as officers.” The court explained that the “core equitable question” is “whether all directors are entitled to fair and non-misleading notice of the agenda for a special meeting.” Delaware law, the court stated, does not endorse “intentional duplicity toward fellow board members” and, because the “meeting notice was inequitable, the actions taken in reliance on it are voidable acts.”

The court entered judgment in favor of the defendants and ordered the parties to confer on and file a proposed form of final judgment by October 24, 2025.

The case is No. 2025-0615-LWW.

Judge: Will, L.

Attorneys: Michael W. McDermott (Berger McDermott LLP) for Bhargava Ghatty, Suryanarayana Raju Mudunuru and Praveen Kotagiri. Michael K. DeSantis (Offit Kurman, Attorneys at Law) for Rajesh Mudili and Alireza ZQ Naderi.

Companies: Altumind Inc.

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