The New Jersey Senate and Assembly have passed legislation that would put strict limitations on derivative suits by corporate shareholders involving New Jersey corporations. The proposed law, S-2326 / A-3123, which won unanimous approval of the Senate Commerce Committee, passed the Assembly on December 17, 2012,and the Senate on February 7, 2013. The measures are part of a three-bill package designed to make New Jersey more business friendly and more in line with certain neighboring states. The legislation, which is now on the Governor's desk for signing, would mandate that a complaining shareholder remain a shareholder for the duration of the proceedings and "fairly and adequately" represent the corporation's interest. If enacted, it will amend the statute governing New Jersey shareholder actions, N.J.S.A. 14A:3-6, imposing measures that could significantly curtail derivative actions in New Jersey. Among other notable changes, it would allow for dismissal of suit based on a determination that "maintenance of the derivative proceeding is not in the best interests of the corporation," which determination could be made by an "independent director," a majority of independent directors, a board-appointed committee or a court-appointed panel. It also would require that any plaintiff holding less than 5% of shares, or shares with a market value less than $250,000, post security for reasonable expenses, at the corporation's request.