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Chancery Finds that Buyer Breached Purchase Agreement by Denying Sellers’ Rights to Participate in a Defense

LPPAS Representative, LLC v. ATH Holding Co. LLC, C.A. 2020-0241-KSJM / Shareholder Representative Services LLC v. ATH Holding Co. LLC, C.A. No. 2020-0443-KSJM (Del. Ch. May 2, 2023) - Delaware law recognizes parties’...more

Chancery Prioritizes Efficiency in Ruling on Discovery Motions

Brown v. Matterport, Inc., 2021-0595-LWW (Del. Ch. Jun. 5, 2023) - The plaintiff sued alleging that the defendants had used lockup restrictions to improperly prevent him from selling shares....more

Supreme Court Affirms Decision That the SolarCity Acquisition was Entirely Fair

The Delaware Supreme Court recently affirmed the Delaware Court of Chancery’s 2022 post-trial decision that Tesla’s 2016 all-stock acquisition of SolarCity Corp. satisfied the entire fairness standard of review, and thus did...more

Chancery Finds Delaware’s Officer Consent Statute Extends Beyond “Formal Officers” to De Facto or Acting Officers

Harris v Harris, C.A. No. 2019-0736-JTL (Del. Ch. January 19, 2023) - Delaware's Officer Consent Statute provides for service of process on anyone who "accepts election or appointment as an officer of a corporation…or who...more

Chancery Finds Stockholder Conferred a Substantial Corporate Benefit by Challenging the Joint Vote of Two Classes of Common Stock...

Garfield v. Boxed Inc., C.A. No. 2022-0132-MTZ (Del. Ch. Dec. 27, 2022). Section 242(b)(2) of the DGCL requires the separate approval of different classes of stock for charter amendments that, inter alia, “increase or...more

Chancery Finds Plaintiff Failed To State A Non-Exculpated Claim Against Special Committee Defendants In Complaint Challenging A...

Ligos v. Tsuff, C.A. No. 2020-0435-SG (Del. Ch. Dec. 1, 2022) - The Delaware Supreme Court’s Cornerstone Therapeutics decision established that, although a transaction involving a controller must satisfy entire fairness...more

In New AmerisourceBergen Decision, Chancery Applies 'Separate Accrual' Laches Analysis for 'Caremark' Red-Flags Claims

In the latest Delaware corporate decision concerning AmerisourceBergen’s role in the nation’s opioid epidemic, the Delaware Court of Chancery largely rejected arguments that laches barred fiduciary duty claims against...more

Chancery Rules That Delisted and Long-Dark Corporation Failed To Show Harm Warranting a Confidentiality Order for Basic Financial...

Rivest v. Hauppauge Digital, Inc., C.A. No. 2019-0848-PWG (Del. Ch. Sept. 1, 2022) - Plaintiff stockholder sought to inspect the books and records of a defendant company, requesting a narrow universe of annual and...more

Chancery Dismisses Claims Alleging Directors Approved Spring-Loaded Stock Options Before Press Releases on COVID-19 Vaccine...

In re Vaxart, Inc. S’holder Litig., Consol. C.A. No. 2020-0767-PAF (Del. Ch. June 3, 2022) - A small biotechnology company issued a press release that connected the company to the federal government’s Operation Warp Speed...more

On Motion To Dismiss, Court of Chancery Holds That Alleged Disclosure Violations Were Insufficient To Rebut Corwin Protections Of...

Teamster Members Ret. Plan v. Randall S. Dearth et al., C.A. No. 2020-0807-MTZ (Del. Ch. May 31, 2022) - Under the Supreme Court’s decision in Corwin and its progeny, a transaction approved by a fully informed, uncoerced...more

Delaware Supreme Court Permits Substitution of Bankruptcy Trustee as Plaintiff to Resolve “Procedural Conundrum”

Lenois v. Lawal, No. 33, 2021 (Del. Dec. 9, 2021) - A company’s bankruptcy filing during an appeal of a dismissal of a derivative action presents questions of who, if anyone, has the standing to pursue the company’s...more

Chancery Dismisses Derivative Action Arising from $1.2 Billion Stock Sale Based on Plaintiffs’ Failure to Plead Demand Futility

In re Kraft Heinz Co. Deriv. Litig., Cons. C.A. No. 2019-0587-LWW (Del. Ch. Dec. 15, 2021) - The Court of Chancery dismissed an insider-trading action on the grounds that plaintiffs failed to plead that a majority of a...more

Stockholders Lack Derivative Standing to Challenge Transactions Whose Terms Were Set Before They Became Stockholders

In re SmileDirectClub, Inc., 2021 WL 2182827 (Del. Ch. May 28, 2021) - Under the “contemporaneous ownership rule,” to have standing to bring derivative claims, stockholders in a Delaware corporation must own stock at the...more

Delaware Supreme Court Adopts Post-Merger Derivative Standing Framework From In re Primedia, Inc. Shareholders Litigation

Morris v. Spectra Energy Partners (DE) GP, LP, No. 489, 2019 (Del. Jan. 22, 2021) - In Delaware corporate law, “the standing inquiry has assumed special significance,” especially in the post-merger context. The Delaware...more

Mindbody Deal Case Provides Conflict Takeaways For Boards

The Delaware Court of Chancery's recent decision in In re: Mindbody Inc. Stockholders Litigation is important reading for lawyers whose practices include evaluating, addressing and — when necessary — litigating potential...more

Chancery Questions Utility of Aronson Test, Dismisses Derivative Suit of Facebook Stockholder for Failure To Allege Demand...

United Food and Comm. Workers Union v. Zuckerberg, C.A. No. 2018-0671-JTL (Del. Ch. Oct. 26, 2020) - In its recent decision in United Food and Comm. Workers Union v. Zuckerberg, the Court of Chancery discussed the legal...more

Chancery Rebukes Party for “Distracting” and “Detrimental” Rule 11 Arguments

POSCO Energy Co., Ltd. v. FuelCell Energy, Inc., C.A. No. 2020-0713-MTZ (Del. Ch. Oct. 22, 2020) - Under Court of Chancery Rule 15, a Delaware plaintiff may request leave from the Court to amend or supplement a complaint....more

Chancery Rules Failure to Disclose “Intrinsic Value” Precludes Corwin Defense – But Does Not Necessarily Suggest a Breach of the...

In In re USG Corp. S’holder Litig., 2020 WL 5126671 (Del. Ch. Aug. 31, 2020), the Court of Chancery granted the director-defendants’ motions to dismiss post-closing money damages claims arising out of the sale of USG...more

In a Books and Records Action, Court Critiques Defendant’s Motion to Dismiss, and Declines to Order Inspection of Documents Not...

Paraflon Investments, Ltd. v. Linkable Networks, Inc., C.A. No. 2017-0611-JRS (Del. Ch. Apr. 3, 2020). Sometimes it bears repeating that Section 220 actions are intended to be summary proceedings to evaluate a...more

Chancery Allows Fiduciary Duty Claims to Proceed against Minority Members Who Blocked Financings in Order to Bankrupt Company and...

Skye Mineral Investors, LLC v. DXS Capital (U.S.) Ltd., C.A. No. 2018-0059-JRS (Del. Ch. Feb. 24, 2020) (Slights, V.C.). Where parties to an LLC agreement do not unambiguously disclaim fiduciary duties, then Delaware law...more

Chancery Further Explains the “Proper Purpose” Requirement for Section 220 Demands

Lebanon County Employees’ Retirement Fund v. AmerisourceBergen Corp., C.A. No. 2019-0527-JTL (Del. Ch. Jan. 13, 2020). Section 220 of the Delaware General Corporation Law (“DGCL”) provides stockholders seeking information...more

Chancery Declines to Apply Corwin Where a Stockholder-Plaintiff Adequately Alleged the Existence of a “Control Group”

Garfield v. BlackRock Mortgage Ventures, LLC, C.A. No. 2018-0917-KSJM (Del. Ch. Dec. 20, 2019). Under Delaware law, when a controlling stockholder benefits personally from the transaction in a manner not shared by minority...more

Chancery Dismisses Stockholder Claims that a Minority Owner was a Controlling Stockholder or that a Majority of the Board was...

In re: Essendant, Inc. Stockholder Litigation, C.A. No. 2018-0789-JRS (Del. Ch. Dec. 30, 2019). When as here a Delaware corporation’s charter contains an exculpation provision under Section 102(b)(7) of the Delaware...more

Chancery Finds Proper Purpose in Books and Records Demand to Investigate Potential Wrongdoing in CBS-Viacom Merger, Orders...

Bucks Cty. Employees Ret. Fund v. CBS Corp., C.A. No. 2019-0820-JRS (Del. Ch. Nov. 25, 2019). A stockholder seeking books and records in Delaware states a proper purpose for inspection by demonstrating a credible basis to...more

Chancery Finds Request for “Corrective Action” to be a Litigation Demand, Dismisses Derivative Claims for Failure to Plead...

Solak v. Welch, et al., C.A. No. 2018-0810-KSJM (Del. Ch. Oct. 30, 2019). Under the Delaware Supreme Court’s decision in Spiegel v. Buntrock, 571 A.2d 767 (Del. 1990), a stockholder who makes a demand upon the board to...more

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