Mya Skye, a social media entrepreneur, develops a new app that allows users to share and compare personal health information such as blood pressure, heart rate, and hydration levels in real time. She offers to sell the app to Forbes Ltd for $150 million. The directors of Forbes Ltd consider the proposal and perform extensive market research to assess the financial viability of the app. They conclude that the app is overpriced and decline Mya's offer. Three months later the app has exploded in users and is now valued at $500 million. The shareholders of Forbes Ltd are furious. The directors of Forbes Ltd are now concerned that they may have breached their duty to act with care, skill and diligence.

Advise the directors of Forbes Ltd if they can rely on the business judgement rule

Answer rating: 100% (QA)

The business judgment rule is a legal principle that provides protection to directors and officers of a corporation when making business decisions It ... View the full answer