News & Analysis as of

In re Novell, Inc. S’holder Litig., C.A. No. 6032 (Del. Ch. Nov. 25, 2014) (Noble, V.C.)

In this memorandum opinion, the Court of Chancery granted summary judgment in favor of defendants on claims alleging that directors acted in bad faith by favoring a bidder in a sale process for reasons other than the pursuit...more

Lee v. Pincus et al., C.A. No. 8458-CB (Del. Ch. Nov. 14, 2014) (Bouchard, C.)

In this memorandum opinion, the Court of Chancery partially granted defendants’ motion to dismiss, holding that (i) plaintiff had stated a claim for breach of fiduciary duty against the Director Defendants because it was...more

In re Sanchez Energy Deriv. Litig., C.A. No. 9132-VCG (Del. Ch. Nov. 25, 2014) (Glasscock, V.C.)

In this memorandum opinion, the Court of Chancery held that plaintiff stockholders failed to plead particularized facts sufficient to demonstrate demand futility and dismissed the plaintiffs’ fiduciary duty, aiding and...more

Delaware Court of Chancery Rejects Entire Fairness Review in Absence of Conflicted Transaction

On October 24, the Delaware Court of Chancery dismissed a lawsuit filed by certain minority stockholders of Crimson Exploration, Inc. in In re: Crimson Exploration Inc. Stockholder Litigation, C.A. No. 8541-VCP (Del. Ch. Oct...more

Delaware Court Establishes "Taxonomy" For Controlling Stockholder Claims

In a recent decision, the Delaware Court of Chancery (Parsons, V.C.) dismissed a shareholder class action complaint alleging that a target company’s board of directors and private equity firm controlling stockholder breached...more

The Ropes Recap: Mergers & Acquisitions Law News - October 2014

In this issue: - Delaware Legislative Update - Amendments to DGCL Effective August 1, 2014 - News from the Courts - Additional Guidance on Kahn v. M&F Worldwide Corp. - Exculpation...more

The Delaware Court of Chancery Finds Two Transactions Were Not Entirely Fair, but Awards No Damages Where the Prices of the...

On September 4, 2014, the Delaware Court of Chancery issued two lengthy post-trial opinions, both authored by Vice Chancellor John W. Noble, finding that recapitalization or restructuring transactions did not satisfy the...more

Forum Selection Bylaws–More Good News

Fending off merger-related shareholder lawsuits keeps getting easier. Just a week ago, the Delaware Chancery Court upheld the enforceability of the bylaw of a Delaware corporation headquartered in North Carolina that selected...more

Breaking: Chancery Court Issues Decision on Claims Against Independent Directors in Controlling Stockholder Transactions

Delaware decisional law on entire fairness review of controlling shareholder transactions has been complicated in part by the subtle distinction between facially disinterested directors (who are liable only where a specific,...more

Delaware Supreme Court Rules That Privileged Documents Must Be Produced To Shareholders Investigating Corporate Misconduct

The Delaware Supreme Court recently held that, in certain circumstances, shareholders may be able to obtain access to privileged, internal documents in order to investigate potential breaches of fiduciary duty. In Wal-Mart...more

Buttonwood Tree Value Partners, L.P. v. R.L Polk & Co., Inc., C.A. No. 9250-VCG (Del. Ch. Aug. 7, 2014) (Glasscock, V.C.)

In this letter opinion, the Court of Chancery dismissed disclosure and aiding and abetting claims brought against a corporation in connection with a self-tender. In granting the defendant-corporation’s motion to dismiss, the...more

Fiduciary Duties in the Context of Dent v. Ramtron Int’l Corp.

The Delaware Court of Chancery recently addressed a number of claims commonly made in the “ubiquitous” stockholder litigation that follows announcement of a public merger or acquisition transaction. In Dent v. Ramtron Int’l...more

Corporations Don't Independently Owe Fiduciary Duties to Stockholders

On Aug. 7, Vice Chancellor Sam Glasscock III issued a letter opinion in the matter Buttonwood Tree Value Partners LP v. R.L. Polk & Co., C.A. No. 9250-VCL, that is not attention-grabbing because it wrestles with some nuanced...more

Director Liability for Cybersecurity Risks

If a corporation is the target of a cyberattack resulting in a data breach, its board may be the target of a shareholder derivative action claiming breach of fiduciary duty. A recent example is Palkon v. Holmes, No....more

Texas Supreme Court's Recent Shareholder Oppression Opinions Reaffirm Primacy of Common Law Fiduciary Duties Under Gearhart

In three recent cases, the Texas Supreme Court has made it clear that for claims of "minority shareholder oppression" — essentially, acts of a majority shareholder group that are harmful to a minority shareholder without...more

Delaware Likes Garner/California Not So Much

In 1970, Richard Nixon was president, the 26th Amendment was still not part of the Constitution, and the Fifth Circuit Court of Appeals issued its opinion in Garner v. Wolfinbarger, 430 F.2d 1093 (5th Cir. 1970). In that...more

Delaware Court Dismisses Shareholder Class Action Suit Attacking Corporate Merger

Almost every proposed corporate merger is met with a shareholder suit against the acquiring company, merger target and the target’s board of directors in which the shareholders assert that the board breached its fiduciary...more

The Ropes Recap: Mergers & Acquisition Law News - Second Quarter 2014

In this issue: -Delaware Legislative Update -Delaware Supreme Court Upholds Facial Validity of Fee-Shifting Provisions in Bylaws of Delaware Non-Stock Corporation -News from the Courts: -Court...more

Chancery Court Provides Additional Room for Shareholders Challenging Change of Control Transactions

What you need to know: In its recent decision in Chen v. Howard-Anderson, Delaware’s Court of Chancery held that directors and officers may be found to have acted in bad faith, thereby breaching their fiduciary duty of...more

Exclusive Forum Provisions: A New Item for Corporate Governance and M&A Checklists

Public companies increasingly are adopting “exclusive forum” bylaws and charter provisions that require their stockholders to go to specified courts if they want to make fiduciary duty or other intra-corporate claims against...more

Bishop Gassis v. Corkery, C.A. No. 8868-VCG (Del. Ch. May 28, 2014) (Glasscock, V.C.)

In this post-trial decision in a proceeding pursuant to 8 Del. C. § 225, the Court of Chancery held that the board of the Sudan Relief Fund, Inc. (the “Fund”), a charitable corporation, validly removed the plaintiff as a...more

Delaware Court of Chancery Rules That a Major Debt Holder and 48 Percent Stockholder Is a Controlling Stockholder and Owes...

In Hamilton Partners, L.P. v. Highland Capital Management, L.P., the Delaware Court of Chancery denied a motion to dismiss breach of fiduciary duty claims brought by former stockholders of American Home Patient, Inc. (AHP)...more

Corporate and Financial Weekly Digest - Volume IX, Issue 25

In this issue: - Delaware Court of Chancery Rules That a Major Debt Holder and 48 Percent Stockholder Is a Controlling Stockholder and Owes Fiduciary Duties to Minority Stockholders - Delaware Court of Chancery...more

Representing the Targeted Executive: Diplomacy Matters

It seemed like a good idea. Provide a local media outlet with a peek under the company's hood—give a tour of the facilities, answer questions about operations, preview a few promising transactions. When the article ran,...more

Delaware Court Rules Nevada Law Governs But Applies Delaware Law

Although there are many significant differences between the corporate laws of Nevada and Delaware, the Nevada Supreme Court has often looked across the country to Delaware. Thus, the Nevada high court has adopted Delaware’s...more

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