News & Analysis as of

Derivative Suit DE Supreme Court

Cadwalader, Wickersham & Taft LLP

Delaware Supreme Court Expands MFW Applicability in Conflicted Controller Transactions

On April 4, 2024, the Delaware Supreme Court issued a much-anticipated decision, In re Match Group Derivative Litigation (“In re Match Group”), extending the MFW doctrine more broadly to all conflicted controller...more

Holland & Knight LLP

Delaware Bankruptcy Court Grants Creditors' Committee of Debtor LLC Derivative Standing

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In a recent opinion, In re Pack Liquidating, LLC (Pack Liquidating), the U.S. Bankruptcy Court for the District of Delaware held that under Official Committee of Unsecured Creditors of Cybergenics Corp. v. Chinery...more

Troutman Pepper

Delaware Supreme Court Confirms Dual MFW Protections Are Needed Outside of the Freeze-Out Merger Context for Application of...

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In In re Match Group, Inc. Derivative Litigation, the Delaware Supreme Court held that the dual procedural protections announced in the seminal case of Kahn v. M & F Worldwide Corp. (MFW) are required in order to shift the...more

A&O Shearman

Delaware Supreme Court Holds MFW Is Applicable To Controlling Stockholder Transactions Even Outside Of Freeze-Out Context

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On April 4, 2024, in an opinion authored by Chief Justice Collins J. Seitz, Jr., the Supreme Court of Delaware sitting en banc held that the framework articulated in Kahn v. M&F Worldwide Corp., 88 A.3d 635 (Del. 2014)...more

Lathrop GPM

Delaware Supreme Court Clarifies Standard of Review for Conflicted Stockholder Transactions with In re Match Group Opinion

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On April 4, 2024, the Delaware Supreme Court issued its opinion in In re Match Group, Inc. Derivative Litigation, clarifying that the heightened entire fairness standard of review applies to judicial review of any transaction...more

Proskauer - Corporate Defense and Disputes

Divided Delaware Supreme Court Decision Highlights Issues About Director Independence in Derivative Actions

The Delaware Supreme Court recently affirmed a Court of Chancery ruling granting a Special Litigation Committee’s motion to terminate a shareholder derivative action that had survived a motion to dismiss. The split decision...more

Allen Matkins

A First Sighting Of Zuckerberg Decision In California

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Last year, the Delaware Supreme Court adopted a tripartite test for assessing demand futility allegations in derivative actions. United Food & Commercial Workers Union v. Zuckerberg 262 A.3d 1034 (Del. 2021). Under this...more

Skadden, Arps, Slate, Meagher & Flom LLP

Insights: The Delaware Edition - May 2022

In this issue we discuss how plaintiffs are finding creative ways to obtain books and records, and appraisal cases where Delaware courts held that fair value rose between signing and closing. Other articles describe how the...more

Akin Gump Strauss Hauer & Feld LLP

In re Boeing: Revisiting Potential Director Liability Exposures

Recent rulings underscore the attention boards of directors and management must continue to pay to the risks faced by companies across all sectors of the economy and their potential impact on business operations...more

Skadden, Arps, Slate, Meagher & Flom LLP

Delaware Courts Simplify Rules for Derivative Actions, Analyze SPAC Fiduciary Duty Review and Clarify Books-and-Records...

Takeaways - The Delaware Supreme Court simplified the pleadings-stage test applied to derivative suits where no demand has first been made on the board. Disputes about stockholder books-and-records requests focus...more

Hogan Lovells

Q4 2021 Quarterly Corporate / M&A decisions updates

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Below is our Corporate / M&A decisions update covering decisions in the fourth quarter of 2021. This update is designed to highlight selected important M&A, corporate, and commercial court decisions on a quarterly basis....more

Morris James LLP

Delaware Corporate and Commercial Case Law Year in Review

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Our 2021 Top 10 list summarizes decisions from the Delaware courts likely to affect business transactions and business litigation going forward. Our criteria for selection are that the decision either meaningfully changed...more

Skadden, Arps, Slate, Meagher & Flom LLP

The Risk of Overlooking Oversight: Recent Caremark Decisions From the Court of Chancery Indicate Closer Judicial Scrutiny and...

In 1996, the Delaware Court of Chancery issued its seminal decision in In re Caremark International Inc. Derivative Litigation, establishing the conditions for director oversight liability under Delaware law. Adopted a decade...more

Skadden, Arps, Slate, Meagher & Flom LLP

Inside the Courts – An Update From Skadden Securities Litigators - December 2021

This quarter’s issue includes summaries and associated court opinions of selected cases decided in August and September 2021. Appraisal Rights - Delaware Supreme Court Enforces Sophisticated Investors’ Waiver of Appraisal...more

Hogan Lovells

Brookfield Asset Management Inc. v. Rosson: Gentile overturned, eliminating dual-natured claims

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In Brookfield Asset Management Inc. v. Rosson, the Delaware Supreme Court unanimously overturned its 2006 decision in Gentile v. Rossette, thereby eliminating the dual nature “Gentile carve-out” that allowed for both direct...more

Hogan Lovells

United Food & Com. Workers Union v. Zuckerberg: Exculpatory clause does not render demand futile

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In United Food & Com. Workers Union v. Zuckerberg, No. 404, 2020 (Del. Sup. Sep. 23, 2021), the Delaware Supreme Court adopted a new, three-part test for determining when a shareholder is required to make a pre-suit demand on...more

Dechert LLP

Securities & Derivative Litigation: Quarterly Update - Q3 2021

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Delaware Supreme Court Articulates a New Standard for Demand Futility and Overturns Gentile v. Rosson - In the third quarter, two new cases from the Delaware Supreme Court altered the legal landscape of derivative actions...more

Goodwin

Delaware Court of Chancery Dismisses Marriott Data Breach Derivative Suit

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Delaware Court of Chancery Dismisses Marriott Data Breach Derivative Suit; DOJ Announces Creation of National Cryptocurrency Enforcement Team; Fifth Circuit Applies New Standard for Disgorgement Orders In Securities Cases to...more

Lowenstein Sandler LLP

Delaware’s New Universal Demand-Futility Test

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On Sept. 23, the Delaware Supreme Court endorsed a new universal three-part demand-futility test in United Food and Commercial Workers Union and Participating Food Industry Employers Tri-State Pension Fund v. Zuckerberg, et...more

K&L Gates LLP

Delaware Supreme Court Adopts a New "Universal" Test for Establishing Demand Futility Granting Directors Greater Protection...

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The Supreme Court of Delaware recently adopted a new three-part “universal” test to determine whether pre-suit demand upon a company’s board should be excused as futile. The new test, endorsed by the Court in United Food and...more

Goodwin

Delaware Court of Chancery Finds that Director’s Email on Outside Email System Remains Confidential

Goodwin on

Delaware Court of Chancery Finds that Director’s Email on Outside Email System Remains Confidential; Delaware Supreme Court Overrules Longstanding Precedent Regarding Derivative Versus Direct Standing; SEC Files Crowdfunding...more

Skadden, Arps, Slate, Meagher & Flom LLP

Delaware Supreme Court Issues Two Opinions Simplifying Delaware Law on Derivative Claims

In one week, the Delaware Supreme Court handed down two important opinions simplifying Delaware law on derivative claims. On September 23, 2021, in United Food and Commercial Workers Union and Participating Food Industry...more

Fenwick & West LLP

Delaware Supreme Court Endorses a New Three-Part Demand Futility Test

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On September 23, 2021—in United Food and Commercial Workers v. Zuckerberg—the Delaware Supreme Court endorsed a new universal three-part demand futility test. The decision will likely have far-reaching consequences, including...more

Holland & Knight LLP

Delaware Supreme Court Adopts Universal 3-Part Test to Assess Demand Futility

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In a Sept. 23, 2021, decision that may make it easier for Delaware boards of directors to obtain an early dismissal of derivative suits brought against them, the Delaware Supreme Court in United Food and Commercial Workers...more

Goodwin

United Food’s “New” Delaware Demand Futility Test: The More Things Change, the More They Stay the Same

Goodwin on

On September 23, 2021, in United Food and Commercial Workers Union v. Zuckerberg et al., the Delaware Supreme Court restated and refined the demand futility test for bringing shareholder derivative claims when it affirmed the...more

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