On August 15, the Texas Court of Appeals decertified a class of Brigham Exploration Co. shareholders, holding that the trial court failed to comply with a state rule requiring rigorous analysis of certification requirements. The suit stems from Brigham’s approval of a $36.50 per share tender offer from Statoil ASA in 2011. Shareholders sued shortly after Brigham announced the transaction, alleging that the board members breached their fiduciary duties by failing to disclose material information to shareholders. The trial court granted class certification and adopted the shareholders’ proposed trial plan, which omitted any discussion or analysis of defendants’ affirmative defenses. Defendants appealed and asserted that the omission evidenced the trial court’s failure to conduct a “rigorous analysis” before certification, as required by state rules. The court of appeals agreed with defendants and reversed the trial court, stating that it is improper to certify a class without knowing how claims can and will be tried, as Texas courts reject the “certify now and worry later” approach.
Brigham Exploration Co., et al. v. Boytim, et al., No. 03-13-00191-cv (Tex. Ct. App. 3d Dist. Aug. 15, 2014).