In other words, courts will not “second-guess” the decisions of disinterested directors made with reasonable diligence in ascertaining the facts and believed to be in the corporation’s best interests. (This is so even if the directors make a bad or “stupid” decision.) [Cal. Prac. Guide: Corps. (The Rutter Group 2015) Ch. 6-C (emphasis added) ] But the process is critical. The business judgment rule “presuppose[s] that judgment—reasonable diligence—has in fact been exercised” and “[a] director cannot close his eyes to what is going on about him in the conduct of the business of the corporation and have it said that he is exercising business judgment.” Burt, 237 Cal.App.2d 828, 852-53, 47 Cal.Rptr. 392. See also In re Bridgeport Holdings, Inc., 388 B.R. 548, 569 (Bankr.D.Del.2008) (<HOLDING>) (citation omitted). The process that directors
recognizing that pursuant to the business judgment rule the decisions of business professionals on the board of directors should be presumed valid holding the privilege belonged to both the corporate client  a closely held charitable foundation  and its directors because at the time of the privileged communication the directors collectively were the client holding under delaware law that corporate officers owe the same fiduciary duties as directors holding under delaware law that if the directors individually and the board collectively fail to inform themselves fully and in a deliberate manner then they lose the protection of the business judgment rule  holding that under delaware law the fiduciary duties of officers are the same as those of directors