Litigation developments: core M&A and corporate governance doctrines
Compliance Perspectives: Due Diligence and Ultimate Beneficial Ownership (UBO)
When a private company is being sold, it is necessary for its minority shareholders to be mindful of protecting their own individual interests when diverging from the controlling shareholder’s interests. Because the...more
On March 3, a committee of the Delaware State Bar Association (DSBA) announced revisions to Senate Bill 21 (SB 21) aimed at paring back some of the proposed protections seen as too controller-friendly....more
On January 21, 2025, the Delaware Supreme Court affirmed the Court of Chancery’s decision in In re Oracle Corp. Derivative Lit., finding that a less than 50% stockholder does not owe fiduciary duties absent evidence of either...more
Proposed amendments to the Delaware General Corporation Law (DGCL) introduce safe harbors for liability from transactions involving directors, officers and controlling stockholders and define and limit a stockholder’s right...more
Controlling stockholders owe fiduciary duties to other stockholders that minority stockholders do not. A holder of over 50% of a corporation’s voting power is clearly a controlling stockholder. As a consequence, transactions...more
As global markets continue to adapt to a new normal, a clear understanding of the structural nuances, risk considerations, and strategic objectives inherent in varying transaction structures enables investors to remain agile...more
The Background: After unsuccessfully trying to convince the special committee not to implement a plan to liquidate a business line, which the controlling stockholder believed would destroy value, the controlling stockholder...more
The Delaware Court of Chancery, in Palkon v. Maffei, et al., C.A. No. 2023-0449-JTL (Del. Ch. Feb. 20, 2024), determined that a reduction in the liability exposure of a fiduciary due to the conversion of a Delaware...more
Most institutions in our society make decisions upon the consent of the majority, from legislatures passing important bills to families deciding on what movie to watch on movie night. ...more
In a landmark decision, In re Sears Hometown & Outlet Stores, Inc. Stockholder Litigation,1 the Delaware Court of Chancery held that a controlling stockholder did not breach his fiduciary duties when he amended company bylaws...more
A takeover offer from a controlling shareholder presents a challenge to boards of directors who are tasked with protecting minority shareholders, particularly where some of the directors on the board may have relationships or...more
New legislation strengthening the compulsory acquisition regulatory framework in the Companies Act 1967 is welcome news for minority shareholders. On 9 May 2023 the Parliament of Singapore passed the Companies, Business...more
On September 20, 2021, the Delaware Supreme Court took the highly unusual step of overruling its prior decision in Gentile v. Rossette. An oft-criticized precedent from 2006, Gentile created an exception allowing minority...more
Hogan Lovells partners Courtney Devon Taylor and Christopher Pickens, from our Philadelphia and Northern Virginia offices respectively, discuss core M&A and corporate governance doctrines – and how they will continue to...more
A Win for Deal Certainty, Delaware Court of Chancery Orders Closing of Cake Supplier Acquisition; Under Armour to Pay $9M to Settle SEC Charges Involving Disclosure Failures; First Circuit Upholds Decision Applying Federal...more
For law bloggers, if there’s one thing more satisfying than writing about an important new court decision, it’s writing about an important new court decision that you won for your client....more
In 2014, the Delaware Supreme Court’s landmark Kahn v. M&F Worldwide Corp.1 (MFW) decision established that the deferential business judgment standard of review could apply to controlling stockholder “squeeze-out” mergers...more
A claim for aiding and abetting a breach of fiduciary duty fails if a plaintiff cannot allege an underlying breach. In that circumstance there is no breach to aid and abet. Where a plaintiff sufficiently alleges a breach,...more
The Delaware Court of Chancery (the Court) in In re Homefed Corporation Stockholder Litigation chronicles a controlling stockholder’s failed attempt to use the protections outlined in Kahn v. M & F Worldwide Corp. (MFW) to...more
In In re HomeFed Corp. Stockholder Litigation (“HomeFed”), the Delaware Court of Chancery considered on a motion to dismiss whether a squeeze-out merger by a controlling stockholder complied with the procedural framework set...more
IN RE DELL TECHNOLOGIES INC. CLASS V STOCKHOLDERS LITIGATION There has been a growing deference in Delaware courts for transactions approved by independent special committees and minority stockholders. In the context of a...more
Gilbert v. Perlman, C.A. No. 2018-0453-SG (Del. Ch. Apr. 29, 2020) - Delaware law imposes fiduciary duties upon controlling stockholders who use their power to control the corporate machinery. For that reason, determining...more
In a decision of interest to private equity investors, the Delaware Court of Chancery (the “Court”) adopted a new framework for determining whether minority stockholders are part of a control group with a separately...more
Investors in Japanese-listed companies have traditionally taken a passive approach to their investments, in part because Japanese business culture have long held an unfavorable view toward investors making demands or voicing...more
Tornetta v. Musk, C.A. No. 2018-0408-JRS (Del. Ch. Sept. 20, 2019). Under Delaware law, executive compensation decisions by a corporation’s board of directors generally are entitled to deferential judicial review, and even...more