Meta attorneys ask judge to dismiss suit claiming that directors' obligations extend beyond company

abcnews.go.com:

Attorneys for Meta and Mark Zuckerberg are asking a Delaware judge to dismiss a shareholder lawsuit asserting that the loyalties of company directors should not lie exclusively with the social media giant

WILMINGTON, Del. — Attorneys for Meta and Mark Zuckerberg asked a Delaware judge on Wednesday to dismiss a shareholder lawsuit asserting novel claims about the roles of corporate leaders and arguing that the loyalties of Meta directors should not lie exclusively with the social media giant.

James McRitchie, who runs a website focused on corporate governance and shareholder activism, argues that Meta's directors have breached their duties to the company by putting profits over broader societal and economic interests, including Meta shareholders’ investments in other companies.

While Delaware law requires corporate directors to act as fiduciaries in the best interests of their stockholders, including maximizing the value of their shares, attorneys for McRitchie argue that Delaware courts should recognize a “portfolio theory” of corporate governance that takes into account external factors.

They argue, for example, that Meta, which owns Facebook, Instagram, Messenger and WhatsApp, has prioritized profits while downplaying the detrimental effects of its products on society and the global economy. That, in turn, can negatively affect the investment portfolios of Meta shareholders who also have invested in other companies, they contend.

“What we’re saying is that (board) decisions should look at the overall portfolio consideration,” attorney Kurt Heyman, who was peppered with questions during a lengthy back-and-forth discussion with Vice Chancellor J. Travis Laster.

Among the ills the lawsuit blames on Meta’s social media