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Compaq Computer Case Analysis

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Compaq Computer v. Horton, 631 A.2d 1 (Del., 1993)

See: https://casetext.com/case/compaq-computer-corp-v-horton

1. Who has the burden of establishing the propriety or lack of propriety of a demand?
2. What is the test for proper purpose?
3. Can a proper purpose be adverse to the corporation's interest?
4. Did either party act unethically? Explain.
5. Can a proper purpose ever be adverse to the corporation's interests?

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Provides an analysis of the Compaq Computer v. Horton Case.

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Compaq Computer Corp. v. Horton, 631 A.2d 1 (Del., 1993)

1. Who has the burden of establishing the propriety or lack of propriety of a demand?
a. The burden of proof shall be on the corporation to establish that the inspection such stockholder seeks is for an improper purpose. 8 Del. C § 220.
b. If there is any doubt, it must be resolved in favor of the statutory right of the stockholder to have an inspection.

2. What is the test for proper purpose?
a. Any stockholder ... shall, upon written demand under oath stating the purpose ...

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