The Texas Business Court has granted Toby Neugebauer's motion for expedited discovery in a lawsuit brought by Fermi seeking to block shareholder accountability, handing the Fermi Board its second consecutive procedural defeat after an earlier loss in federal court. The ruling centers on a Bylaw Amendment the Fermi Board adopted that imposes a 70% supermajority voting requirement to expand the size of the board.
What Expedited Discovery Means Here
Expedited discovery is a court order requiring a defendant to produce documents and answer questions on an accelerated schedule, bypassing the months-long standard timeline that ordinary civil litigation allows. The practical implication for Neugebauer is meaningful: Fermi will be required to disclose materials related to the bylaw amendment sooner rather than later, narrowing the board's room to stall while its governance maneuver remains in effect.
The 70% Supermajority: Why the Threshold Is the Fight
A supermajority voting requirement raises the bar for a corporate action above a simple majority. Fermi's Bylaw Amendment specifically sets that bar at 70% approval before the board can be expanded. Such provisions are typically contested on the grounds that they entrench incumbent directors — when the threshold for a shareholder-driven board change is set high enough, a minority of shareholders loyal to current management can block any restructuring effort. That is precisely the shareholder accountability question at the center of Neugebauer's case.
Fermi's Pivot from Federal to State Court
The Fermi Board's decision to initiate this lawsuit followed a loss in federal court. Rather than accepting that result, the board pivoted to the Texas Business Court — a specialized venue designed to handle complex commercial disputes — in an apparent effort to neutralize Neugebauer's shareholder challenge through a different judicial forum. The Texas Business Court's decision to grant expedited discovery suggests that strategy has not produced the delay the board may have sought.
The discovery order means Fermi's internal record on the 70% supermajority amendment will face earlier scrutiny than the board's litigation posture might have anticipated.