In Nevada, Controlling Shareholders Are Off the Hook
In May 2025, an important and largely unnoticed development occurred in the corporate-law competition among states. In response to Delaware’s SB 21, Nevada enacted AB239, extending its exculpation statute — which had previously shielded only directors and officers from monetary liability to shareholders— to controlling shareholders.
The amendment is the first of its kind. A controlling shareholder now has a single fiduciary obligation: not to pressure a director to breach a duty that would expose that director to non-exculpated liability in the context of a self-dealing transaction. That is the entire duty.
The practical consequence is striking. If a controlling shareholder extracts value from the corporation without coercing a director into fraud, intentional misconduct, or a knowing violation of law, there is no liability and no judicial scrutiny. No fairness standard. No independent committee. No majority-of-the-minority vote.