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November 21, 2024 Rain | 46°F
The 193rd General Court of the Commonwealth of Massachusetts

Section 14: Benefit enforcement proceeding

Section 14. (a)(1) The duties under this chapter and the general public benefit purpose and any specific public benefit purpose of a benefit corporation may be enforced only in a benefit enforcement proceeding.

(2) Except in a benefit enforcement proceeding, no person shall bring an action or assert a claim against a benefit corporation or its directors or officers with respect to:

(i) failure to pursue or create general or specific public benefits set forth in its articles; or

(ii) a violation of a duty or standard of conduct under this chapter.

(3) A benefit corporation shall not be liable for monetary damages under this chapter for any failure of the benefit corporation to pursue or create a general public benefit or a specific public benefit.

(b) A benefit enforcement proceeding shall be commenced or maintained only:

(1) directly by the benefit corporation; or

(2) derivatively by:

(i) a shareholder;

(ii) a director;

(iii) a person or group of persons that owns beneficially or of record 5 per cent or more of the equity interests in an association of which the benefit corporation is a subsidiary; or

(iv) other persons as specified in the articles of organization, bylaws or shareholder agreement of the benefit corporation.