Finance & Banking Mergers & Acquisitions Civil Procedure

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Delaware Chancery Court Rejects Disclosure-Only Settlement in Trulia/Zillow Merger Litigation, Making Clear Such Settlements Will...

On January 22, 2016, Delaware Chancellor Andre C. Bouchard rejected a proposed “disclosure-only” settlement in In re Trulia Stockholder Litigation. The decision confirms the Chancery Court’s growing skepticism for...more

In re Trulia, Inc. Stockholder Litigation, C.A. No. 10020-CB (Del. Ch. Jan. 22, 2016) (Bouchard, C.)

This opinion represents the Court of Chancery’s latest and most definitive move toward greater scrutiny of disclosure-based settlements of stockholder class actions challenging public company mergers and acquisitions. In...more

Delaware Court of Chancery Rejects Another Disclosure-Only M&A Settlement and Warns of “Increasingly Vigilant” Scrutiny

The Delaware Court of Chancery dealt another blow to disclosure-only settlements of merger litigation and refused to approve a proposed class-action settlement arising from Zillow, Inc.'s acquisition of Trulia, Inc. ...more

Buyer Beware! Purchasers in Asset Sales Liable for Multiemployer Pension Plan Withdrawal Liability

Two recent appellate court decisions have made it easier for multiemployer pension plans to impose withdrawal liability on a purchaser in an asset deal. In Tsareff v. ManWeb Services, Inc., the Seventh Circuit expanded its...more

Rural/Metro: Delaware Supreme Court Affirms $76 Million Award Against Financial Advisor: Holds That Financial Advisors Are Not...

On November 30, 2015, the Delaware Supreme Court issued an opinion affirming the Court of Chancery’s decision in In re Rural/Metro Corporation Stockholders Litigation. In the earlier decisions, the Court of Chancery found...more

M&A Update: Delaware Supreme Court Upholds Rural Metro Decision, but Financial Advisors Can Breathe a Sigh of Relief

In a November 30, 2015 decision, the Delaware Supreme Court upheld the Delaware Chancery Court’s $76 million damages award against RBC Capital in In re Rural/Metro Corp. S’holders Litig. The ruling, however, notably rejected...more

Financial Advisor Conflicts of Interests: Rural/Metro and Other Recent Cases

In a series of recent decisions, Delaware courts have emphasized the potential risks arising when a board’s financial advisor has a conflict of interests. The board of an acquired entity generally will enjoy the...more

Second Circuit Upholds Common-Interest Privilege for Borrower’s Sharing of Legal Advice with Consortium of Lenders

The Second Circuit held last week that a borrower did not waive the attorney-client privilege by providing documents to a consortium of lender banks that shared a common legal interest with the borrower in the tax treatment...more

Inside M&A - October 2015

Overview of SPACs and Latest Trends - A number of recent successful business combination transactions involving special-purpose acquisition companies (SPACs) led by prominent sponsors have driven a resurgence in the SPAC...more

Delaware Court of Chancery Cautions Directors: Be Vigilant in Recognizing Advisor’s Conflict of Interests

Shareholders challenged the merger of Zale Corporation with Signet Jewelers Ltd. In a decision dated October 1, 2015, the Delaware Court of Chancery credited allegations that the board of directors of Zale breached its...more

Global Private Equity Newsletter - Fall 2015 Edition: Buyer Beware – Court Lowers Hurdle to Make Claim for Withdrawal Liability...

In Tsareff v. ManWeb Services, Inc., the U.S. Court of Appeals for the Seventh Circuit held that an asset purchaser’s pre-closing knowledge of a seller’s potential multiemployer plan withdrawal liability could be sufficient...more

The Ninth Circuit Hammers Out A New Successorship Liability Test Under The MPPAA

The Ninth Circuit, in Resilient Floor Covering Pension Trust Fund Board of Trustees v. Michael’s Floor Covering, Inc., Case No. 12-17675 (9th Cir. Sept. 11, 2015), joined the Seventh Circuit in finding that an asset...more

Disclosure-Only Settlements Face Continued Scrutiny In Delaware

On Thursday, September 17, 2015, in In re Riverbed Technology, Inc. Stockholders Litigation, the Delaware Chancery approved a disclosure-only settlement related to the go-private deal for Riverbed Technology, Inc. Although...more

Court Of Appeals Affirms Business Court Award Of $1 Million In Fees To Class Counsel

It seems like forever ago that the then venerable North Carolina institution, Wachovia Bank, failed and was acquired by Wells Fargo. (This was actually seven years ago). But just last week came what might be the final...more

Asset Purchasers May Be Found Liable as “Successors”

Recent court decisions suggest that parties engaged in corporate asset sale transactions involving potential multiemployer pension plan liability should give extra consideration to the structure and terms of their...more

LongPath Capital, LLC v. Ramtron Int'l Corp., C.A. No. 8094-VCP (Del. Ch. June 30, 2015) (Parsons, V.C.)

In this appraisal action, the Court of Chancery determined that the negotiated merger price less synergies yielded the fair value of Ramtron International Corporation (“Ramtron”) for purposes of Section 262 of the Delaware...more

Court Of Chancery Upholds Primacy Of Purchase Price Adjustment Clause

The buyer’s rights under a stock purchase agreement sometimes seem in conflict. This decision resolves such a conflict by holding that under the terms of the agreement, the purchase price adjustment process trumps the buyer’s...more

Mello-Roos Act Can Lawfully Finance Eminent Domain Actions

California Appellate Court Affirms Public Water District's Action to Buy Private Water Company - The Mello-Roos Act can be used to finance acquisitions by eminent domain, the Second District Court of Appeal affirmed in a...more

Georgia Banking Regulator Revokes License of Pennsylvania Mortgage Lender

On April 13, the Georgia Department of Banking and Finance (Department) entered into a Consent Order (Order) with a Pennsylvania-based mortgage lender and its owners for failing to file a timely application with the state...more

Court Of Chancery Adopts Merger Price In Appraisal Proceedings As Fair Value

After a complete analysis of the usual issues in an appraisal case involving a DCF valuation, the Court here concluded that the result was close enough to the actual price paid in the merger to warrant adoption of the merger...more

Court Of Chancery Explains Step-Transaction Theory

Not infrequently a plaintiff will argue that 2 transactions are so interrelated that his rights have been violated by structuring the deal to take 2 steps to accomplish it....more

Delaware Court Examines Implied Covenant of Good Faith Related to Earn-Out

In Fortis Advisors LLC, as the equity representative v. Dialog Semiconductor PLC, the Delaware Court of Chancery examined the implied covenant of good faith in the context of an earn-out provision included in a merger...more

The Ropes Recap: Mergers & Acquisitions Law News - January 2015

In this issue: - News from the Courts - Delaware Supreme Court Clarifies Fiduciary Duties in Sale Context and Overturns Judicial Imposition of Auction in Deal with Passive Market Check - Illinois Court...more

“Appraisal Arbitrage” Receives Boost from Delaware Court of Chancery

An increasingly popular hedge fund strategy, commonly referred to as “appraisal arbitrage,” recently received a significant boost from the Delaware Court of Chancery. Appraisal arbitrage refers to the practice of buying...more

Indiana Department of Revenue Rules Forced Disposition is Nonbusiness Income

In Letter of Finding No. 02-20140306 (Dec. 31, 2014), the Indiana Department of Revenue (Department) determined that income from the sale of two operating divisions of a business pursuant to an order of the Federal Trade...more

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