The case alleged that Emergent’s Board and senior management failed to implement any internal compliance or sterility testing programs, such that the Board was not even informed as the government and customer inspectors found repeated safety violations, lax quality control procedures, and a failure to take steps to ensure vaccine safety. The failure of the Board to exercise oversight led to the destruction of tens of millions of doses of Johnson & Johnson and AstraZeneca COVID-19 vaccine at a time when supplies of the vaccine were critically low—leading to untold harm to Emergent. The claims were developed through a books-and-records investigation under 8 Del. C. § 220, which uncovered evidence that the board lacked meaningful reporting and oversight structures for manufacturing compliance and safety.
After the case was stayed pending a related securities fraud class action, plaintiffs obtained additional information that strengthened the claims and drove a coordinated mediation alongside related derivative actions pending in Maryland federal and state courts. The litigation ultimately resulted in a $15 million recovery and a comprehensive package of corporate governance reforms designed to address the underlying oversight failures. These reforms included enhancements to the board’s risk management committee, strengthened management oversight, facility-level controls, formalized training and reporting protocols, and changes to board and management compensation policies to align incentives with compliance and safety. The settlement received final approval on August 7, 2025, by Judge Blake in the U.S. District Court for the District of Maryland, In re Emergent BioSolutions, Inc. Stockholder Derivative Litigation, Case No. 8:21-cv-01595.