Fund managers occasionally like to provide input into the strategy and direction of companies in their portfolios, such as by speaking regularly with management or even appointing individuals to the board. There can be significant consequences under Delaware law, however, should that involvement veer into the realm of “control.” That is because, much like a company’s directors, investors that are deemed to be “controlling shareholders” owe fiduciary duties to minority stockholders – and can be liable for damages if those duties are breached. In a guest article, Jack Yoskowitz and Laura Miller, partner and associate, respectively, at Seward & Kissel, explain the “control group” concept, summarize key Delaware court decisions involving the concept and provide several takeaways for fund managers. See our three-part series on parental liability in the E.U.: “‘Undertakings’ and Potential Scope of Risk for PE Sponsors” (May 21, 2019); “Rebuttable Presumption of Decisive Influence and Four Misconceptions About Avoiding Liability” (Jun. 4, 2019); and “Mitigating Liability at Various Stages of Portfolio Company Ownership” (Jun. 11, 2019).