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Delaware Supreme Court Provides Additional Guidance on Pleading Direct Claims Against Controllers and Control Groups

Sheldon v. Pinto Technology Ventures, L.P., No. 81, 2019 (Del. Oct. 4, 2019). The Delaware Supreme Court affirmed the Court of Chancery’s dismissal of an alleged direct claim for dilution of the voting and economic...more

'Scott v. DST Systems': Court Rejects Mootness Fee for Target’s Supplemental Disclosures Explaining Valuation Analyses

Disclosure-only settlements of M&A class actions have received increased scrutiny since decisions like the Delaware Court of Chancery’s 2016 Trulia opinion and the U.S. Court of Appeals for the Seventh Circuit’s Walgreens...more

Chancery Denies Motion to Dismiss Claim for Breach of Earn-Out When Unable to “Divine any Meaning” From Provision

Western Standard, LLC v. SourceHOV Holdings, Inc., C.A. No. 2018-0280-JRS (Del. Ch. July 24, 2019). Defendant Pangea acquired BancTec through a merger agreement that provided for an earn-out to former BancTec stockholders...more

Chancery Finds Controlling Stockholder Impliedly Consented to Jurisdiction Through Board’s Adoption of Delaware Forum-Selection...

In re Pilgrim’s Pride Corp. Derivative Litigation, Consol. C.A. No. 2018-0058-JTL (Del. Ch. Mar. 15, 2019). Stockholders that control Delaware corporations find themselves subject to fiduciary duties. According to this...more

Chancery Dismisses Books and Records Action Based on Pending Plenary Action

CHC Investments LLC v. Firstsun Capital Bancorp, C.A. No. 2018-0610-KSJM (Del. Ch. Jan. 24, 2019). One proper purpose for a books and records inspection under Section 220 of the Delaware General Corporation Law is to...more

Chancery Addresses Pre-Suit Demand Refusal Standard for Special Committees

City of Tamarac Firefighters’ Pension Trust Fund v. Corvi, C.A. No. 2017-0341-KSJM (Del. Ch. Feb. 12, 2019). Under Delaware law, stockholders who wish to pursue a derivative claim on the corporation’s behalf face an...more

Chancery Addresses Lawyer-Driven Effort Defense to Books and Records Inspection

Inter-Local Pension Fund GCC/IBT v. Calgon Carbon Corp., C.A. No. 2017-0910-MTZ (Del. Ch. Jan. 25, 2019). It is sometimes fair to characterize plaintiff-side representative litigation in the corporate context as...more

Chancery Addresses Books and Records Demand Under Section 220 by Papa John’s Founder

Schnatter v. Papa John’s Int’l, Inc., C.A. No. 2018-0542-AGB (Del. Ch. Jan. 15, 2019). As a general matter, under Section 220 of the DGCL, directors of a Delaware corporation enjoy the right to virtually unfettered access...more

High Court Again Denies 'Corwin' Deference Due to Material Omissions Concerning Sale Process

Earlier this year, the Delaware Supreme Court held that Corwin deference was not warranted where a recommendation statement to stockholders disclosed that a founder and board chairman abstained from recommending in favor of...more

Chancery Greenlights Use of Books and Records Demands to Buttress Post-'Corwin' M&A Challenges

Stockholder M&A challenges in the Delaware Court of Chancery have declined in the wake of the well-known Trulia (and its federal corollary Walgreens) and Corwin decisions, which respectively reduced incentives for pre-closing...more

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