| Old | New | Differences | |
|---|---|---|---|
| 1 | 1 | 89R1267 SRA-D | |
| 2 | 2 | By: Harrison H.B. No. 872 | |
| 3 | 3 | ||
| 4 | 4 | ||
| 5 | 5 | ||
| 6 | 6 | ||
| 7 | 7 | A BILL TO BE ENTITLED | |
| 8 | 8 | AN ACT | |
| 9 | 9 | relating to the burden of proof in certain derivative proceedings. | |
| 10 | 10 | BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | |
| 11 | 11 | SECTION 1. Subchapter L, Chapter 21, Business Organizations | |
| 12 | 12 | Code, is amended by adding Section 21.5525 to read as follows: | |
| 13 | 13 | Sec. 21.5525. BURDEN OF PROOF IN CERTAIN DERIVATIVE | |
| 14 | 14 | PROCEEDINGS. Notwithstanding any other law, in a derivative | |
| 15 | 15 | proceeding by a shareholder that alleges an act or omission related | |
| 16 | 16 | to the improper consideration of environmental, social, and | |
| 17 | 17 | governance criteria in the performance of the act or omission, the | |
| 18 | 18 | burden of proof is on the corporation to prove the act or omission | |
| 19 | 19 | was in the best interest of the corporation. | |
| 20 | 20 | SECTION 2. Section 21.5525, Business Organizations Code, as | |
| 21 | 21 | added by this Act, applies only to an action commenced on or after | |
| 22 | 22 | the effective date of this Act. An action commenced before the | |
| 23 | 23 | effective date of this Act is governed by the law as it existed | |
| 24 | 24 | immediately before the effective date of this Act, and the former | |
| 25 | 25 | law is continued in effect for that purpose. | |
| 26 | 26 | SECTION 3. This Act takes effect September 1, 2025. |