Investors filed a $5 million derivative lawsuit against a private company alleging breach of fiduciary duty. The investors claimed that some of the company’s officers had personal connections to the third party contractor hired to re-tool the company’s assembly line and hired that contractor to further their personal interests, not the interests of the company. Other officers and directors were alleged to have either knowingly colluded with one another, or at least breached their duty of care in undertaking the project without properly investigating the qualifications of the contractor. The suit settled for $1.5 million with an additional $150,000 for attorneys’ fees.

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