An employee of a small business convinced the board of directors that he was qualified to step into the role of president of the company, and he was appointed. Under his leadership, the company’s financial position substantially weakened. On behalf of the company, a shareholder sued the board of directors alleging that they used poor judgment and did not act in the best interests of the company when they appointed the new president. The case eventually settled for $1,500,000 and legal fees totaled $300,000.

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