The Court of Chancery initially found that Wal-Mart stockholders who were attempting to prosecute derivative claims in Delaware could no longer do so because another court, a federal court in Arkansas, had reached a final judgment on the issue *829of demand futility first, and the stockholders were adequately represented in that action. But the derivative plaintiffs in Delaware assert that applying issue preclusion in this context violates their Due Process rights.
This dispute implicates complex questions of law and policy, including: the relationship among competing derivative plaintiffs (and whether they may be said to be in "privity" with one another); whether failure to seek board-level company documents renders a derivative plaintiff's representation inadequate; policies underlying issue preclusion, such as preventing duplicative litigation and promoting judicial economy; and our obligation to respect the judgments of other jurisdictions.
The Chancellor's Original Opinion1 granting Defendants'2 motion to dismiss, issued May 13, 2016, did not expressly focus on the Delaware Plaintiffs'3 Due Process arguments as a separate issue. We asked the Chancellor to supplement his opinion by focusing on the Due Process concerns. In his Supplemental Opinion,4 issued July 25, 2017, the Chancellor reiterated that, under the present state of the law, the subsequent plaintiffs' Due Process rights were not violated. Nevertheless, he advocates a different approach. Though acknowledging that no federal court has reached the same conclusion, the Chancellor suggested that we adopt a rule that a judgment in a derivative action cannot bind a corporation or other stockholders until the suit has survived a Rule 23.1 motion to dismiss. The Chancellor believes that such a rule would better protect derivative plaintiffs' Due Process rights, even when they were adequately represented in the first action.
We decline to adopt the Chancellor's recommendation that we refuse to give preclusive effect to other courts' decisions on demand futility and, instead, AFFIRM the Original Opinion granting Defendants' motion to dismiss for the reasons discussed below, including because, under the *830governing federal law, there is no Due Process violation.
I.
The facts of this case follow the familiar pattern when news reports expose scandal at a corporation.5 After the New York Times reported in April 2012 on an alleged bribery scheme and cover-up perpetrated by executives at Wal-Mart's Mexican unit,6 Wal-Mart de Mexico ("WalMex"), derivative suits followed. The Arkansas Plaintiffs7 filed eight derivative complaints in the United States District Court for the Western District of Arkansas, and seven derivative actions were filed in the Delaware Court of Chancery.8 The claims in Arkansas and Delaware were similar: they were primarily for breaches of fiduciary duty related to the Wal-Mart board's oversight of WalMex, though the litigation in Arkansas included additional claims under Sections 14(a) and 29(b) of the Securities Exchange Act of 1934, and a claim for contribution and indemnity.9 The Defendants filed motions seeking to have all litigation proceed in one forum10 and to stay the Arkansas litigation.11 The Arkansas court initially stayed its proceedings pending the litigation in Delaware.12
*831But the situation took a turn from the ordinary when the litigation over a books-and-records demand filed pursuant to 8 Del. C. § 220 (" Section 220") became unusually contentious after the plaintiff alleged deficiencies in the Company's first production, received August 1, 2012.13 This dispute included a trial,14 an appeal to this Court,15 and a subsequent motion for contempt against Wal-Mart.16 In all, the Section 220 litigation lasted nearly three years.
The Delaware Plaintiffs attempted to obtain the Company's books and records because then-Chancellor Strine had commented, "I don't know why the plaintiffs would ever wish to proceed" without first obtaining additional documentary evidence.17 He added, "[t]here is everything about the context of this case which requires great care and pleading,"18 and he urged the Delaware Plaintiffs to "take a sincere look at the books and records and file the strongest possible complaint that [they] could."19 The Arkansas Plaintiffs were aware of the Chancellor's warning.20
In the meantime, as the litigation over Wal-Mart's document production dragged on, the Eighth Circuit vacated the Arkansas federal district court's stay out of concern for the stalled Section 14(a) claim.21 The Eighth Circuit concluded that the district court's continued, blanket abstention was not proper under the Colorado River doctrine because the "Delaware and Federal Proceedings are not parallel" given that "Delaware courts have no jurisdiction to directly address the merits of the [Arkansas] Plaintiffs' Securities Act claims."22 But the Eighth Circuit noted that, on remand, the district court "may impose a more finite and less comprehensive stay, if it concludes that such a stay properly balances the rights of the parties and serves the interests of judicial economy."23
Back at the Arkansas district court, the Defendants modified their stay request and asked for a stay that would expire upon the Delaware court's ruling on demand *832futility. They argued that this more limited stay would thus satisfy the Eighth Circuit's directive.24 But the Arkansas court denied the Defendants' motion.25 The Defendants then moved to dismiss the Arkansas Complaint for failure to plead demand futility under Federal Rule of Civil Procedure 23.1.26
The Delaware Plaintiffs had expressed concern that, if the Arkansas court ruled first and found demand futility lacking, the Defendants were likely to argue in Delaware that the Arkansas court's ruling on demand futility should have preclusive effect through the doctrine of "collateral estoppel," also known as "issue preclusion" (used here interchangeably).27 The Delaware Plaintiffs also knew that the Arkansas court had warned in its June 4, 2014, order denying Defendants' stay that "[i]t is likely that the first decision on demand futility will be entitled to collateral estoppel effect."28 Yet the Delaware Plaintiffs refrained from intervening or otherwise expressing their concerns to the Arkansas court.29 On March 31, 2015, the Arkansas *833court granted Defendants' motion to dismiss, with prejudice.30
On May 1, 2015, nearly a month after the Arkansas dismissal, the Delaware Plaintiffs amended the operative Delaware Complaint, asserting a single derivative claim for breach of fiduciary duty. As anticipated, Defendants moved to dismiss. And, as also anticipated, Defendants argued that the Arkansas decision collaterally estopped the Delaware Plaintiffs from relitigating the issue of demand futility. They also contended that, if not precluded, Delaware Plaintiffs failed to plead demand futility.
The Court of Chancery granted Defendants' motion to dismiss based on issue preclusion. In determining the preclusive effect of the Arkansas federal court's dismissal, the Court of Chancery looked to federal common law, which the Chancellor determined looks to the law of the rendering state in which the federal court exercised diversity jurisdiction (in this case, Arkansas).31 Thus, the trial court found that Arkansas state law governed, "[s]ubject to Constitutional standards of due process."32 The Chancellor held that Defendants satisfied the requisite elements for preclusion under Arkansas law, including privity.33
The Chancellor also observed that "[a]pplying the privity requirement to derivative actions involving two different stockholder plaintiffs raises the question [of] whether the required privity is between the two stockholders, or between each stockholder and the corporation."34 He agreed with the view that the first stockholder plaintiff does not represent the second stockholder plaintiff. Rather, "both plaintiffs sue on behalf of the corporation and are essentially interchangeable."35 The Chancellor summarized his conclusions on privity as follows:
[T]he overwhelming majority of decisions in other jurisdictions have found privity between different stockholder *834plaintiffs in derivative actions on the premise that the corporation is the real party in interest [in] both actions, a premise that the Arkansas Supreme Court has recognized expressly. The Restatement is inconclusive, and public policy arguments exist on both sides of the privity question. Taking all these points into consideration, it is my opinion that Arkansas courts likely would find that the privity requirement is satisfied here because that result accords with the clear weight of authority and resonates with the policy in Arkansas of using preclusion to ensure that issues are litigated only once.36
He observed that "most courts addressing the issue have concluded that the corporation is bound by the results of the first judgment in subsequent litigation, even if the result is to preclude a different stockholder's subsequent derivative claim."37 Regarding federal Due Process concerns, the Court of Chancery suggested that scrutinizing the adequacy of the prior representation serves as a proxy for ensuring that plaintiffs' Due Process rights are protected.38 Here, the Chancellor found that the Arkansas Plaintiffs were adequate representatives and, accordingly, implied that there was no Due Process violation.
On appeal, Delaware Plaintiffs argue that the Court of Chancery erred in finding: (a) privity between Arkansas and Delaware Plaintiffs; (b) adequate representation by the Arkansas Plaintiffs; and (c) that the issue of demand futility was "actually litigated" in Arkansas. They also argue that the Court of Chancery violated their Due Process rights, including by finding: (i) privity; and (ii) adequacy of representation.39 We review the trial court's dismissal based on issue preclusion, and its interpretation of federal Due Process principles, de novo .40
We first considered this appeal last spring, but we postponed a final ruling because the Delaware Plaintiffs' Due Process arguments gave us pause. In asserting that the Court of Chancery had violated their Due Process rights by finding privity between the Arkansas and Delaware plaintiffs, the Delaware Plaintiffs rely on Vice Chancellor Laster's opinion in EZCORP ,41 which the Chancellor had not *835addressed in his Original Opinion, likely because the Delaware Plaintiffs had submitted the Court of Chancery's opinion in EZCORP to the Chancellor after completion of the motion to dismiss briefing.
In EZCORP , a plaintiff filed a derivative complaint against the outside directors of EZCORP. Between the briefing and argument on the defendants' motion to dismiss, the plaintiff proposed a voluntary dismissal of the complaint without prejudice. The defendants objected and sought a dismissal with prejudice "as to the world."42 Applying Court of Chancery Rule 15(aaa),43 the trial court ruled that the complaint should be dismissed with prejudice, but only as to the named plaintiff.44 In dicta, the Court of Chancery also observed that, both as a matter of Delaware law45 and Due Process, a derivative plaintiff may not bind a later derivative plaintiff unless and until the first derivative plaintiff survives a motion to dismiss, or the board of directors has given the plaintiff authority to proceed by declining to oppose the suit.46
The EZCORP decision relies on the dual, or two-fold, nature of derivative litigation, noting that the key distinction between the first and second phases of a derivative action is that "the first phase of the derivative action [is one] in which the stockholder sues individually to obtain authority to assert the corporation's claim."47 The Vice Chancellor reasoned that, "until the derivative action passes the Rule 23.1 stage, the named plaintiff does not have authority to sue on behalf of the corporation or anyone else."48
*836Thus, in EZCORP , the Vice Chancellor suggested that binding subsequent derivative plaintiffs to a dismissal based on demand futility in a case where they were not parties "deprive[s] them of the due process of law guaranteed by the Fourteenth Amendment."49 The Vice Chancellor relied on the United States Supreme Court decision in Smith v. Bayer Corp. ,50 which suggested that, as a matter of Due Process, "[n]either a proposed class action nor a rejected class action may bind nonparties."51 The Vice Chancellor believed that the same logic should apply to derivative actions that do not adequately plead demand futility. Thus, he stated that, "just as the Due Process Clause prevents a judgment from binding absent class members before a class has been certified, the Due Process Clause likewise prevents a judgment from binding the corporation or other stockholders in a derivative action until the action has survived a Rule 23.1 motion to dismiss, or the board of directors has given the plaintiff authority to proceed by declining to oppose the suit."52 The Court of Chancery's Original Opinion did not expressly discuss Bayer .
In response, Defendants argue that this Court, in Pyott II ,53 had already addressed the Due Process issue, at least implicitly. They observe that this Court recognized in Pyott II that numerous jurisdictions have held that, "because the real plaintiff in a derivative suit is the corporation, 'differing groups of shareholders who can potentially stand in the corporation's stead are in privity for the purposes of issue preclusion.' "54 Defendants observe that we had more recently affirmed a similar finding of privity in Asbestos Workers Local 42 Pension Fund v. Bammann .55 Further, they *837argue that Arkansas federal courts have repeatedly "held or presumed that '[c]ollateral estoppel prevents the issue of pre-suit demand futility from being relitigated.' "56
Regarding EZCORP , Defendants note that, even if its approach were advisable as a matter of Delaware policy, it does not accurately reflect federal law or the law of Arkansas. They elaborate that EZCORP turned only on Delaware law (specifically Court of Chancery Rule 15 (aaa) ), which allows the Delaware Court of Chancery to dismiss derivative suits as to the named plaintiff only. They point out that the Federal Rules of Civil Procedure (which governed the proceedings in Arkansas federal court) lack a similar provision, as do the procedural rules of Arkansas.
When first considering this appeal, we believed that there was some "force" to the Delaware Plaintiffs' argument that the Court of Chancery may have "conflated" the privity and Due Process analyses.57 We appreciate that Arkansas law is unsettled in this derivative context. Moreover, even the United States Supreme Court, in Taylor v. Sturgell ,58 cautioned that the term "privity" has been used to cover a range of different relationships and observed, for example, that "privity" has referred to substantive legal relationships justifying preclusion and, alternatively, the term has also been used more broadly "as a way to express the conclusion that nonparty preclusion is appropriate on any ground."59
As such, the United States Supreme Court, accordingly, avoided the term "privity"60 in Taylor , an opinion where it identified six recognized situations where nonparty preclusion does not violate the Due Process Clause of the United States Constitution.61 These six situations are when the party to be precluded: (1) agreed to be precluded by contract;62 (2) had a pre-existing substantive legal relationship with the prior litigant;63 (3) was adequately *838represented by the prior litigant who shared its interests;64 (4) assumed control over the prior litigation;65 (5) is attempting to act as a proxy for the prior litigant seeking to relitigate a given issue;66 or (6) is expressly prohibited by a statutory scheme that complies with Due Process.67 The United States Supreme Court stated that this is a nonexclusive list and that there may be other exceptions recognized by case law.68
In our Remand Order, we suggested that the "most analogous of these exceptions involves putative class actions"69 (i.e. , this third exception)-those "limited circumstances" where a "nonparty may be bound by a judgment because she was 'adequately represented by someone with the same interests who [wa]s a party' to the suit."70 Such representative suits include, among others, "properly conducted class actions"71 and "suits brought by trustees, guardians, and other fiduciaries."72
In Smith v. Bayer ,73 the United States Supreme Court considered whether putative, uncertified class actions fall within this exception as "properly conducted class action[s]," and it held that they do not.74 The Court stated that "a 'properly conducted class action,' with binding effect on nonparties [i.e. , consistent with Due Process], can come about in federal courts in just one way-through the procedure set out in Rule 23."75 In other words, "[n]either a proposed class action nor a rejected class action may bind nonparties."76 Only class actions certified under Rule 23 may bind unnamed members of the certified class actions under this exception to avoid breaching the Due Process rights of subsequent litigants. We questioned whether the same reasoning should be applied to derivative plaintiffs who fail to plead demand futility, given the similarities between a pre-demand futility derivative action and a pre-certified class action.
Accordingly, we posed the following question to the Chancellor:
In a situation where dismissal by the federal court in Arkansas of a stockholder *839plaintiff's derivative action for failure to plead demand futility is held by the Delaware Court of Chancery to preclude subsequent stockholders from pursuing derivative litigation, have the subsequent stockholders' Due Process rights been violated? See Smith v. Bayer Corp. , 564 U.S. 299 [131 S.Ct. 2368, 180 L.Ed.2d 341](2011).77
We requested a supplemental opinion on this question. In doing so, we underscored the "troubling" nature of this case.78 On the one hand, this Court has repeatedly admonished plaintiffs to use the "tools at hand" and to request company books and records under Section 220 to attempt to substantiate their allegations before filing derivative complaints.79 Delaware Plaintiffs heeded this advice and demanded Company books and records under Section 220. In contrast, the Arkansas Plaintiffs did not seek books and records, and their complaint was dismissed with prejudice.
On the other hand, we have acknowledged the importance of the Full Faith and Credit Clause of the U.S. Constitution,80 which implicates principles of comity and respect for the judgments of other courts. We have observed that, although Delaware has an "undisputed interest" in "governing the internal affairs of its corporations," that interest "must yield to the stronger national interests that all state and federal courts have in respecting each other's judgments."81 The importance of these intertwined issues and their policy implications deserved closer examination and the benefits of additional briefing if the Chancellor desired.
After requesting and receiving additional briefing from the parties, the Chancellor provided his thoughts in his Supplemental Opinion. He found that the weight of authority suggests that, no, the Court of Chancery does not violate the Due Process rights of later derivative plaintiffs if it concludes that a federal court's dismissal of a prior plaintiff's derivative action for failure to plead demand futility precludes subsequent stockholders from pursuing derivative litigation relating to the same issues-unless the prior representation was inadequate, i.e. , "unless the representative plaintiff's management of the first derivative action was 'so grossly deficient as to be apparent to the opposing party' or failed to satisfy one of the Restatement's other criteria for determining adequacy of representation."82
Nonetheless, the Chancellor recommended that this Court depart from the weight of authority and adopt the rule *840proposed in EZCORP .83 Although the Chancellor acknowledged that "no court has done so to date, and although the [Delaware] Supreme Court previously declined to embrace such a rule in the context of considering the question of privity in derivative litigation,"84 the Chancellor suggested that such a rule would "better safeguard the due process rights of stockholder plaintiffs and should go a long way to addressing fast-filer problems currently inherent in multi-forum derivative litigation."85
II.
We appreciate the Chancellor's thoughtful deliberations on this difficult matter. But we decline to embrace his suggestion that the EZCORP approach become the law governing the preclusive effect of prior determinations of demand futility, especially given that federal law governs our evaluation of Due Process concerns. Three federal circuit courts have already addressed whether granting preclusive effect to prior determinations of demand futility violates Due Process, and they each arrived at the same conclusion: the Due Process rights of subsequent derivative plaintiffs are protected, and dismissal based on issue preclusion is appropriate, when their interests were aligned with and were adequately represented by the prior plaintiffs.86 Most other cases on this issue have granted preclusive effect to a prior court's decision on demand futility, though many of these opinions do not expressly address Due Process.87
*841A. The Governing Law
As we observed above, "[t]he preclusive effect of a federal-court judgment is determined by federal common law."88 Though, by its terms, the Full Faith and Credit Clause of the United States Constitution does not explicitly apply to judgments of federal courts,89 the United States Supreme Court "has held that a state court is required to give a federal judgment the same force and effect as it would be given under the preclusion rules of the state in which the federal court is sitting."90
All parties and the Court of Chancery agreed that, under federal common law, a federal court sitting in diversity jurisdiction will apply the preclusion law of the state in which it sits. The Court of Chancery reasoned that the "issue requiring preclusion analysis here is the Arkansas district court's decision concerning demand futility relating to the Arkansas plaintiffs' fiduciary duty claim, which was brought under the district court's diversity jurisdiction."91 Though that is true, we observe that the Arkansas Complaint also asserted federal question and supplemental jurisdiction given the presence of the federal securities law claims. Thus, it is arguable that the federal common law of issue preclusion applies.92 However, we believe *842the result would be the same under both federal and Arkansas law. As discussed below, Arkansas law draws on federal law (as well as the Restatement), and the United States Supreme Court recently reiterated that the federal courts also look to the Restatement (Second) of Judgments for "the ordinary elements of issue preclusion."93
All parties also agree that examining privity does not end our inquiry. The United States Supreme Court has stated that "[t]he federal common law of preclusion is, of course, subject to due process limitations."94 Regarding issues of Due Process, federal law governs our analysis.95
As such, for issue preclusion to apply, the party asserting issue preclusion must satisfy the court that, first, all elements of issue preclusion are present and, second, Due Process requirements are satisfied.96 We address these requirements in turn.
B. Issue Preclusion
"Collateral estoppel, or issue preclusion, bars relitigation of issues, law, or fact actually litigated in the first suit."97
*843The Chancellor noted that collateral estoppel requires the "following four elements": "1) the issue sought to be precluded must be the same as that involved in the prior litigation; 2) that issue must have been actually litigated; 3) the issue must have been determined by a valid and final judgment; and 4) the determination must have been essential to the judgment."98 Though many Arkansas cases indicate that there are "four elements" of issue preclusion,99 the Court of Chancery adopted the view of the parties and suggested that issue preclusion under Arkansas law requires another two elements: (i) privity; and (ii) adequacy of the prior representation. We thus assume that these elements are also required for issue preclusion to be applied.100
The Arkansas Supreme Court in *844Crockett v. C.A.G. Investments, Inc.101 said that privity "exists when two parties are so identified with one another that they represent the same legal right."102 Here, the parties have sparred over whether the requisite showing of privity is satisfied by demonstrating that privity exists among competing sets of derivative plaintiffs, or that privity exists between the corporation and its stockholders acting as derivative plaintiffs. The Arkansas Supreme Court has not yet addressed "privity" in this context. Thus, confronting this unsettled question of issue preclusion law, the parties agreed, as did the Chancellor, that the Arkansas courts would look to the Restatement (Second) of Judgments (the "Restatement") for guidance.103 Arkansas courts also look to other jurisdictions104 and consider policy implications.105
The Restatement does not use the term "privity." Yet the parties and the Chancellor focused on Section 41, which explains that a nonparty "who is represented by a party is bound by and entitled to the benefits of a judgment as though he were a party."106 Section 41 then lists five situations where a nonparty is said to have been represented by a prior party,107 thereby allowing preclusion of a nonparty provided certain preconditions are met.108 One such situation is Section 41(1)(e), where the prior party was a "representative of a class of persons similarly situated, designated as such with the approval of the court , of which the [nonparty] is a member."109
As to the possibility of privity among successive sets of derivative plaintiffs, the Delaware Plaintiffs argue that a subsequent derivative plaintiff lacks privity with *845an earlier derivative plaintiff who did not survive a motion to dismiss because that earlier derivative plaintiff was not "designated" as a representative by the court, as under the Restatement Section 41(1)(e) scenario.110 Delaware Plaintiffs posit that, just as in class actions, where such judicial designation (or "judicial authority") is conferred through the class certification procedures of Federal Rule of Civil Procedure 23, the "right of stockholders to try to sue derivatively cannot be extinguished by a foreign judgment if no representative authority was conferred."111 Delaware Plaintiffs argue that such representative authority is conferred only after the derivative complaint survives a motion to dismiss for failure to plead demand futility: "a stockholder's right to seek leave to compel assertion of the corporate claim is an individual one ... and the plaintiff does not represent any person until obtaining that leave,"112 i.e. , by a court's finding that the plaintiff's complaint has survived a motion to dismiss.
Regarding the possibility of privity between the Delaware Plaintiffs and Wal-Mart, which was a party to the prior litigation, Delaware Plaintiffs argue that they lacked such privity because they "were unrepresented" by Wal-Mart in the prior litigation and "Wal-Mart was named merely as a nominal defendant, with adverse interests [to Delaware Plaintiffs]-not the identity of interests that is the hallmark of privity."113
Defendants counter by pointing to "the prevailing rule" that "stockholder-plaintiffs are in privity on the issue of demand futility because they 'are acting on behalf of the corporation ... and the underlying issue of demand futility is the same regardless of which shareholder brings suit.' "114 And they argue that, given that no Arkansas authorities conflict with this approach, the Chancellor was right when concluding in his Original Opinion that "the Arkansas Supreme Court would follow the majority rule that privity attaches to subsequent derivative stockholders."115
We see the privity analysis as follows: Privity under Arkansas law "exists when two parties are so identified with one another that they represent the same legal right."116 Arkansas' approach appears to be a flexible and practical inquiry that eschews strict reliance on formal categories of representative relationships and focuses on "the reasons for holding a person bound by a judgment," including fairness concerns.117 Similarly, while the United *846States Supreme Court has abandoned the term "privity,"118 federal courts applying federal common law, like courts in Arkansas, have focused on whether the person arguably precluded is so identified in interest with the former litigant that she represents the same legal right.119 Viewing derivative litigation in stages, and analyzing what is happening at each stage, helps to explain why privity exists here.120
At the first stage of a derivative action (assertion of demand futility), the stockholder-derivative plaintiff is permitted to litigate only the board's capacity to control the corporation's claims. The corporation is always the sole owner of the claims.121 In other words, the suit is always about the corporation's right to seek redress for alleged harm to the corporation. As the Arkansas Supreme Court has stated, "inherent in the nature of the [derivative] suit itself [is] that it is the corporation whose rights are being redressed rather than those of the individual plaintiff."122
The demand requirement (contained in Federal Rule of Civil Procedure 23.1 )123 reflects the requirement that a *847corporation's important business decisions should be made by its board of directors.124 Such decisions include the decision to sue a corporation's directors on behalf of the corporation.125 At the start of the derivative suit, the stockholder-derivative plaintiff only has standing, as a matter of equity, to set in motion the judicial machinery on the corporation's behalf.126 The stockholder-derivative plaintiff may assume control of the corporation's claim only if he demonstrates that demand on the board would be futile. But, through the entire process, the corporation alone is the real party in interest because the suit is always on its behalf.
The "dual" nature of the derivative action does not transform a stockholder's standing to sue on behalf of the corporation into an individual claim belonging to the stockholder. The named plaintiff, at this stage, only has standing to seek to bring an action by and in the right of the corporation and never has an individual cause of action. This highlights a fundamental distinction from class actions, where the named plaintiff initially asserts an individual claim and only acts in a representative capacity after the court certifies that the requirements for class certification are met.127
However, when multiple derivative actions are filed (in one or more jurisdictions), the plaintiffs share an identity of interest in seeking to prosecute claims by and in the right of the same real party in interest-i.e. , as representatives of-the corporation. Here, the Delaware and Arkansas Plaintiffs sought to enforce the same legal rights by stepping into Wal-Mart's shoes to assert the corporation's claims related to the same alleged misconduct and investigation. Though not a formal "representative" of other stockholders at this stage because the real party in interest is the corporation, differing groups of stockholders who seek to control the corporation's cause of action share the same interest and therefore are in privity.
Even before Crockett , in Arkansas Department of Human Services v. Dearman ,128 the Arkansas Court of Appeals said in a compellingly straightforward fashion that privity "means a person so identified in interest with another that he *848represents the same legal right," also titled an "identity of interest."129 There, the court found privity between a mother and the state's Department of Human Services ("DHS") as they shared an "identity of interest": both the mother and DHS sought "to prove allegations of sexual abuse against the father of the children, to remove them from his custody, and to protect the best interests of the children."130 Further, the subsequent litigant, DHS, had "notice of the earlier action and the opportunity to participate."131 Thus, the Dearman court found privity where a subsequent litigant with notice of the first action sought to relitigate the same issue on behalf of the same real party in interest, the children. The Arkansas Supreme Court applied the Dearman test in Crockett .132 Although the Arkansas Supreme Court has not addressed the application of collateral estoppel in the derivative context, we think that application of Arkansas' flexible approach set forth in Crockett and Dearman suggests that there is privity here as a matter of Arkansas law. This is so given the identity of interest derivative plaintiffs share in having a stockholder control the corporation's claim instead of the directors, and given that the real party in interest, the corporation, was a party to the litigation.133
A review of federal common law reinforces this view. The five federal circuit courts that have considered whether privity exists between sets of successive derivative plaintiffs have all found the requisite privity under the applicable law, whether state law or federal common law.134 In Sonus , the First Circuit found privity between two successive derivative plaintiffs suing on behalf of the same corporation because "[u]nder Massachusetts law, a derivative suit is prosecuted 'in the right of a corporation,' "135 and "the plaintiff in a derivative suit represents the corporation, which is the real party in interest."136 In other words, privity existed because both derivative plaintiffs sought to represent *849the same legal right-that of the corporation, which was the real party in interest. In Arduini , the Ninth Circuit relied on Sonus to find the same.137
In Dana v. Morgan , a century-old Second Circuit case, the second derivative plaintiff argued that "the judgment of the New York court [i.e. , the first court] does not affect him, as he was not a party to it, a privy to it, or represented in it."138 However, the court determined, "[t]he answer is that the corporation whose interest he seeks to represent in this suit was a party to that [prior New York] action and is concluded by it and that that concludes him."139 After all, "there can be but one adjudication in the rights of the corporation."140 In Nathan v. Rowan , the Sixth Circuit cited Dana in holding that, "[i]n shareholder derivative actions arising under Fed. R. Civ. P. 23.1, parties and their privies include the corporation and all nonparty shareholders."141 And, in Smith v. Waste Management , the Fifth Circuit found privity, but did not explain why.142 Thus, we are satisfied that privity exists here and that the requirements of issue preclusion are met.143
We address the last purported element, the adequacy of representation requirement, as part of the federal Due Process overlay. As the Chancellor acknowledged, "[his] consideration of due process in Wal-Mart I [the Original Opinion] was embedded in the determination of adequacy of representation."144
C. The Federal Due Process Requirement
As mentioned, "[t]he federal common law of preclusion is subject to due process limitations."145 Such limitations derive from the Due Process Clause of the Fourteenth Amendment, which provides that no state shall "deprive any person of life, liberty, or property without due process of law ...."146 "The opportunity to be heard is an essential requisite of due process of law in judicial proceedings."147
*850Non-party issue preclusion, by its nature-i.e. , depriving a party of the ability to litigate an issue-conflicts with the "historic tradition," rooted in Due Process, "that everyone should have his own day in court."148 Therefore, as a general rule, "one is not bound by a judgment in personam in a litigation in which he is not designated as a party or to which he has not been made a party by service of process."149 But this general "rule against nonparty preclusion" is subject to several exceptions, such as those outlined in Taylor -exceptions where the application of nonparty issue preclusion is said to comply with the requirements of Due Process.150
One of these exceptions-the so-called "third exception"-covers "certain limited circumstances" where "a nonparty may be bound by a judgment because she was 'adequately represented by someone with the same interests who [wa]s a party' to the suit."151 Thus, this exception has two prongs: (a) same interests, and (b) adequate representation of those interests.
The privity analysis discussed above underscores the commonality and alignment of interests among successive sets of derivative plaintiffs. As explained above, we are satisfied that there is sufficient alignment of interest under both Arkansas and federal common law. Therefore, with this commonality-of-interest safeguard satisfied, the evaluation of the adequacy of the prior representation becomes the primary protection for the Due Process rights of subsequent derivative plaintiffs.152
The United States Supreme Court in Taylor articulated three "minimum" requirements for showing that "[a] party's representation of a nonparty is 'adequate'
*851for preclusion purposes."153 First, the interest of the nonparty and her representative must be aligned.154 Second, "either the party understood herself to be acting in a representative capacity or the original court took care to protect the interests of the nonparty."155 And third, "sometimes" notice is required.156
Here, as mentioned, the privity analysis reinforces and satisfies the alignment-of-interests requirement.
Second, as to whether the derivative plaintiffs here understood that they were acting in a representative capacity although not yet authorized to control the corporate cause of action, the record makes clear that both sets of plaintiffs understood that a judgment in their case could impact the other stockholders.157 The Arkansas Plaintiffs had been warned by the federal court of the likelihood that the court's decision would have preclusive effect.158 And, as noted, the Delaware Plaintiffs acknowledged that likelihood and expressed concern to both the Delaware Court of Chancery and the Delaware Supreme Court about the "severe risk" that an Arkansas judgment on demand futility would precede a Delaware ruling, and the Arkansas judgment would have preclusive effect.159 Moreover, the Arkansas court took care to protect the interests of the nonparty Delaware Plaintiffs by granting a stay while they pursued their Section 220 litigation in Delaware. The federal court initially stayed the Arkansas proceedings "pending the resolution of the state-court actions in the Delaware Court of Chancery."160 Thus, that court was willing to stand down and let the Delaware litigation proceed to conclusion.161
Third, federal courts have signaled that derivative suits are situations where notice is not required to comply with Due Process.162 We need not resolve that issue as it *852is undisputed that Delaware Plaintiffs had notice of the Arkansas action in this instance.
Federal courts have also looked to Sections 42(1)(d) and (e), and Comments e and f, of the Restatement for further guidance on what qualifies as "adequate" representation in order to comply with Due Process.163 Indeed, the Restatement explains that its requirements are "closely related to, if indeed they are not particularized expressions of, the requirements of due process."164 In addition to providing that there cannot be a "substantial divergence of interests" between the representative and the represented,165 the Restatement states that the prior representative must not have "failed to prosecute or defend the action with due diligence and reasonable prudence" such that "the opposing party was on notice of facts making that failure apparent."166 Comment f to Section 42(1)(e) provides additional commentary describing what constitutes inadequate conduct of litigation.167 First, the comment speaks to the quality of the representation, by specifying that the representation must not have been "grossly deficient," and then explaining what that entails.168 Second, the comment speaks to conflicts of interest , such as whether the prior judgment was the product of collusion between the representative and the opposing party and whether, "to the knowledge of the opposing party, the representative s [ought] to further his own interest at the *853expense of the represented person."169 "[W]hether the representation has been inadequate is a question of fact to be decided in light of the issues presented in the case and the factual and legal contentions that might reasonably have been expected to be presented."170
Based on our reasoning, we affirm the Chancellor's ultimate conclusion that the Arkansas Plaintiffs were adequate representatives because, in addition to the absence of any conflicts or other misalignment of interests among the competing sets of plaintiffs in seeking to represent Wal-Mart, (i) the quality of their representation was not grossly deficient, and (ii) their economic interests were not antagonistic to other stockholders.
i. The Arkansas Plaintiffs' failure to seek books and records from the Company does not render them grossly deficient representatives.
Delaware Plaintiffs argue that the Arkansas Plaintiffs demonstrated "grossly deficient," inadequate representation by failing to seek additional books and records despite the Chancellor's warning.171 They contend that this choice amounts to more than mere "[t]actical mistakes or negligence" or failure "to invoke all possible legal theories or to develop all possible sources of proof"-situations that the Restatement views as insufficient grounds to deny preclusive effect to a prior judgment.172
Delaware courts have repeatedly urged parties to use Section 220 to seek relevant books and records before filing derivative complaints. The Delaware Plaintiffs contend that, although the New York Times article detailed conduct by certain officers and employees and included excerpts to certain key company documents, the documents did not address board-level conduct. Thus, they argue that the Arkansas Plaintiffs should have known they would be unable to meet the pleading requirements to establish demand futility, as then-Chancellor Strine had warned.
We might see this as a closer call if the Arkansas Plaintiffs had not obtained any documents, particularly since the complaints were focused on the state-law Caremark claims.173 But that is not the case. At the argument on the initial motion to stay in Arkansas, for example, Arkansas Plaintiffs' counsel acknowledged that she shared then-Chancellor Strine's view that "oftentimes it is very hard to implicate the board without seeing some internal documents showing that the board knew of the wrongdoing," but she argued that this situation was different: she stated that internal *854memoranda in the public domain (linked from the New York Times article) "show beyond any doubt that the board of directors was told about the widespread bribery and they were told about the coverup of the widespread bribery back in 2005."174 Arkansas Plaintiffs' counsel stated, "we thought about [obtaining documents through Section 220 ] long and hard," but determined that, "[i]n this case we didn't need it because we had these underlying documents."175
The Chancellor concluded that "it does not follow that plaintiffs are necessarily inadequate representatives because their counsel chose not to follow a recommended strategy in a different action, even one suggested by a preeminent corporate jurist, particularly when they are litigating in a different jurisdiction before a different judiciary."176 As the Chancellor recognized, the Arkansas Plaintiffs were represented by more than a dozen attorneys from several firms, and no one argued that they were not experienced counsel. In fact, one lead counsel had successfully litigated a key Delaware Section 220 case, and one of the lead Arkansas Plaintiffs had been lead plaintiff in the Pyott case.
Here, the Arkansas Plaintiffs considered making a Section 220 demand, but they decided against it because they considered the documents in the New York Times article sufficient.177 It turns out they were wrong. Although it might have been a tactical error, the Arkansas Plaintiffs' decision to forgo a Section 220 demand in this instance does not rise to the level of constitutional inadequacy.178 Reasonable litigants can differ on such tactical decisions.
ii. The Arkansas Plaintiffs did not seek to advance their interests at the expense of the Delaware Plaintiffs.
The Delaware Plaintiffs argue that Arkansas Plaintiffs "acted to further their own economic interest in litigating in Arkansas," against the Chancellor's warning that plaintiffs should seek Company books and records.179 Delaware Plaintiffs assert that "[t]he moment they did so, an irreconcilable conflict arose between the Arkansas Plaintiffs and other Wal-Mart stockholders."180 The Restatement provides that a prior judgment may be denied preclusive effect where, "to the knowledge of the opposing party, the representative seeks to further his own interest at the expense of *855the represented person."181 The plaintiffs' interests, as distinguished from the counsels' interests, were identical, as discussed above. Moreover, we see no support for any suggestion that the Arkansas Plaintiffs had an interest adverse to Wal-Mart or that they would benefit from harming the Company and, by extension, from harming Delaware Plaintiffs.
In their supplemental briefing following remand, the Delaware Plaintiffs argue that the Court of Chancery erred in "halting" discovery regarding the alleged "conflicts of the Arkansas Plaintiffs' counsel."182 They further contend that the discovery stay was improper given the Chancellor's "heavy reliance on an affidavit of Arkansas Plaintiffs' counsel," whom they had no opportunity to cross-examine.183 But the Delaware Plaintiffs confined this argument to a footnote in their opening brief on appeal.184 Thus, the argument is waived,185 and we do not address the question of whether discovery might have been appropriate (and, if so, to what extent) as to the asserted conflict among Arkansas Plaintiffs' counsel.
III.
In conclusion, as we said in Pyott II , our state's interest in governing the internal affairs of Delaware corporations must yield to the "stronger national interests that all state and federal courts have in respecting each other's judgments."186 This delicate balance would be impaired were we to adopt the Chancellor's suggestion to follow the EZCORP dicta as the rule for determining the preclusive effect of other courts' dismissals based on demand futility.
Accordingly, we affirm the Court of Chancery's dismissal of the Delaware Plaintiffs' complaint. Defendants satisfied the requirements for invoking issue preclusion under either Arkansas law or federal common law. The federal law on the Due Process implications of issue preclusion demonstrates that the application of issue preclusion here does not violate the Due Process rights of the Delaware Plaintiffs. We greatly appreciate the thought and time that the Chancellor and the parties devoted to this important matter.