Books-and-Records Demands

Enumerated Tiers, Same Gateway: § 220 After the 2025 Amendments

The 2025 amendments (S.B. 21) rebuilt the statute around a defined, tiered scope. "Books and records" now means an enumerated list — the charter and bylaws, three years of stockholder-meeting minutes, stockholder communications, and annual financial statements, plus board and committee minutes, "[m]aterials provided to the board of directors or any committee of the board of directors in connection with actions taken," any § 122(18) agreement, and "[d]irector and officer independence questionnaires" — and inspection requires a demand "made in good faith and for a proper purpose" that "describes with reasonable particularity the stockholder’s purpose and the books and records the stockholder seeks to inspect," seeking records "specifically related to the stockholder’s purpose" Del. Code Ann. tit. 8, § 220. Anything else sits behind § 220(g): the Court of Chancery may order "other specific records" produced only where the stockholder "has made a showing of a compelling need for an inspection of such records to further the stockholder’s proper purpose" and "has demonstrated by clear and convincing evidence that such specific records are necessary and essential to further such purpose." Even then the corporation "may redact portions of any books and records produced to such stockholder under this subsection to the extent the portions so redacted are not specifically related to the stockholder’s purpose."

The proper-purpose gateway carried over intact. AmerisourceBergen Corp. v. Lebanon County Employees’ Retirement Fund, 243 A.3d 417 (Del. 2020) set the baseline the amendments left untouched: "To obtain books and records, a stockholder must show, by a preponderance of the evidence, a credible basis from which the Court of Chancery can infer there is possible mismanagement or wrongdoing warranting further investigation." The demand need not forecast the endgame — "when a Section 220 inspection demand states a proper investigatory purpose, it need not identify the particular course of action the stockholder will take if the books and records confirm the stockholder’s suspicion of wrongdoing" — and "an investigating stockholder is not required in all cases to establish that the wrongdoing under investigation is actionable"; only the "rare case" where a "purely procedural obstacle" means "the anticipated litigation will be dead on arrival" justifies denial on that ground. The Supreme Court’s first decision under the new regime kept that architecture — Paramount Global v. State of Rhode Island, No. 129, 2025 (Del. Mar 25, 2026) reaffirmed that "[t]he investigation of corporate wrongdoing is firmly established as a proper purpose for a § 220 inspection," held that "[t]he general rule is that when a stockholder seeks relief under § 220, it will be limited to evidence identified in the demand and the information available to the stockholder when the demand was made," although "under exceptional circumstances, the Court of Chancery may, in the exercise of its sound discretion, consider post-demand evidence that is material to the court’s credible-basis inquiry and not prejudicial to the corporation," and confirmed that "[a] stockholder can rely on hearsay to provide a credible basis to suspect wrongdoing, so long as the hearsay carries sufficient guarantees of trustworthiness" — sustaining a credible basis built on 47 news articles corroborated by public filings.

Chancery’s first applications show how the tiers work in practice. Trematerra v. The Affinity Project, Inc., No. 2025-0896-DH (Del. Ch. Dec 22, 2025) — a valuation demand against a private company — confirmed that "Valuation of a stockholder’s investment in a corporation, particularly where the corporation is privately held, has long been recognized as a proper purpose under 8 Del. C. § 220," and that the credible-basis screen for investigatory purposes is "the ‘lowest possible burden of proof’ but it is greater than mere suspicion." Beyond the enumerated categories, though, the court held the new line: "The section 220(g) records may be produced only if the stockholder has shown a ‘compelling need’ to further the proper purpose," and has "demonstrated by ‘clear and convincing evidence that such specific records are necessary and essential to further’ the proper purpose." Even inside a proper purpose, "the ‘necessary and essential’ standard demands that no more than what is sufficient to meet Plaintiff’s proper purpose is subject to court-compelled production" — so the court "eliminated any duplicative documents," granted the financial records needed to value the shares, and rejected a tacked-on investigatory purpose built on optimistic projections alone.

Draft the demand around the statute’s architecture. The enumerated categories — board minutes, board materials, financials — are the default tier; emails, officer-level documents, and informal communications now require a compelling-need showing backed by clear and convincing evidence, so plead them separately and expect the court to prune anything duplicative. Build the credible-basis record before the demand goes out, because the evidence is generally frozen as of the demand date — reliable press reports corroborated by public filings can carry it. Companies, for their part, hold new statutory leverage: confidentiality conditions, incorporation-by-reference of produced materials into any later complaint, and redaction of anything not specifically related to the stated purpose.