News & Analysis as of

Corwin Doctrine Shareholder Litigation

Hogan Lovells

Delaware court holds Corwin does not cleanse claims based on “enduring alleged entrenchment devices”

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In In re Edgio Stockholders Litigation, No. 2022-0624-MTZ (Del. Ch. May 1, 2023) the Delaware Court of Chancery, in denying a motion to dismiss, evaluated a stockholder action to enjoin a transaction in light of one party’s...more

Hogan Lovells

Q1 2023 Quarterly Corporate / M&A decisions updates

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M&A and shareholder litigation is off to a busy start in 2023, with Delaware courts issuing several interesting opinions. The Delaware Supreme Court reversed a Delaware Court of Chancery decision, finding that the “maximum...more

Skadden, Arps, Slate, Meagher & Flom LLP

In Novel SPAC Ruling, Court Questions Fundamental SPAC Structure Under Delaware Law

With all the SPAC activity and scrutiny over the past several years, it was only a matter of time before the Delaware courts had an opportunity to weigh in on SPAC stockholder litigation. Early last year, in January...more

Morris James LLP

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

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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

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

In re Pattern Energy Group Inc: risks to directors and officers in not maximizing stockholder value - Corporate / M&A Decisions...

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In a 200+ page decision, the Court of Chancery in In re Pattern Energy Group Inc. Stockholders Litigation, (C.A. No. 2020-0357-MTZ (Del. Ch. May 6, 2021)) declined to dismiss putative shareholder class claims for breach of...more

Stinson - Corporate & Securities Law Blog

Votes Compelled by Stockholders Agreement Do Not Count Towards Corwin Cleansing

In connection with an M&A transaction, in In Re Pattern Energy Group Inc. Stockholders Litigation the Delaware Court of Chancery determined that that the plaintiff had stated a claim against the director defendants for breach...more

Morris James LLP

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

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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

Skadden, Arps, Slate, Meagher & Flom LLP

Key Developments in Delaware Corporation Law

Consistent with trends in recent years, in 2019 Delaware corporation law largely was shaped by post-closing suits for money damages against directors who had approved mergers and acquisitions. Two Delaware Supreme Court...more

A&O Shearman

M&A Watch: Seeking Your True Purpose? Delaware Offers Guidance on Section 220 Requests

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Following Corwin v. KKR Financial Holdings and other Delaware cases that have reinforced the standards that stockholder suits must meet to survive dismissal, would-be litigants have increasingly invoked Section 220 of the...more

Skadden, Arps, Slate, Meagher & Flom LLP

Inside the Courts – An Update From Skadden Securities Litigators - September 2019

This quarter’s issue includes summaries and associated court opinions of selected cases principally decided between May and August 2019....more

Troutman Pepper Locke

Delaware Recognizes Reality of Merger Negotiations in Upholding Application of Business Judgment Rule

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In In re Towers Watson & Co. Stockholders Litigation, 2019 WL 3334521 (Del. Ch. July 25, 2019), the Delaware Court of Chancery applied the business judgment rule to dismiss a stockholder suit challenging the $18 billion...more

Wilson Sonsini Goodrich & Rosati

Delaware Court of Chancery Allows Claims Against a Board, Financial Advisor, and Acquiror in a Company Sale

On June 21, 2019, Vice Chancellor Kathaleen S. McCormick of the Delaware Court of Chancery issued an opinion addressing a number of significant issues relating to the proper conduct of an M&A process. In denying all...more

Skadden, Arps, Slate, Meagher & Flom LLP

‘Partial and Elliptical Disclosures’ May Preclude Corwin Doctrine

Under Corwin v. KKR Financial Holdings LLC1 and its progeny, “when disinterested, fully informed, uncoerced stockholders approve a transaction absent a looming conflicted controller,” the irrebuttable business judgment rule...more

Fox Rothschild LLP

“Partial And Elliptical Disclosures” Prevents The Application Of Corwin Business Judgment Review

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In the recent decision of Morrison v. Berry, No. 445, 2017 (Del. July 9, 2018), the Delaware Supreme Court issued an opinion of import in connection with the Corwin doctrine. In Morrison, the High Court reversed a dismissal...more

Morris James LLP

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

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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

A&O Shearman

Finding Disclosures Inadequate To Merit Application Of Corwin, Delaware Supreme Court Reverses Court of Chancery Dismissal Of...

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On July 9, 2018, the Delaware Supreme Court reversed and remanded a decision by the Delaware Court of Chancery to dismiss stockholder class claims for breach of fiduciary duty brought against the former directors of The Fresh...more

A&O Shearman

Delaware Court Of Chancery Denies Corwin Motion To Dismiss, Finding Allegations Of Control Adequately Pleaded As To 22%...

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On March 28, 2018, Vice Chancellor Joseph R. Slights III of the Delaware Court of Chancery denied a motion to dismiss several derivative and class action claims brought by stockholders of Tesla, Inc. (“Tesla”) asserting that...more

Morris James LLP

Is Stockholder Litigation in Trouble in Delaware? An Update

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A series of recent Delaware court decisions have caused some plaintiffs law firms to decide stockholder litigation should no longer be filed in the Delaware courts. This article will first explain the background to their...more

A&O Shearman

Delaware Court Of Chancery Relies On Corwin To Dismiss Post-Closing Fiduciary Duty Claims After Finding Acquiror Was Not A...

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On March 9, 2018, Vice Chancellor Joseph R. Slights III, of the Delaware Court of Chancery, dismissed a stockholder class action complaint seeking damages for alleged breaches of fiduciary duty by directors of Rouse...more

A&O Shearman

Delaware Supreme Court Affirms Delaware Court Of Chancery's Dismissal Of Fiduciary Duty Breach Claims, Finding Non-Exculpated...

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On March 15, 2018, the Supreme Court of Delaware affirmed the Delaware Court of Chancery’s dismissal of a putative stockholder class action asserting claims for breach of fiduciary duty and quasi-appraisal against the...more

A&O Shearman

Declining To Find Enhanced Scrutiny Inapplicable To Post-Closing Damages Actions, Delaware Court Of Chancery Denies Motion For...

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On February 6, 2018, Vice Chancellor J. Travis Laster of the Delaware Court of Chancery denied a summary judgment motion by defendant Potomac Capital Partners II, LP (“Potomac”) in an action by stockholders challenging the...more

Morris James LLP

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

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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

A&O Shearman

Delaware Court Of Chancery Grants Books And Records Demand, Holding That Corwin Is Irrelevant To Section 220 Proceedings

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On December 29, 2017, Vice Chancellor Joseph R. Slights III of the Delaware Court of Chancery granted a stockholder’s demand to inspect books and records related to the acquisition of West Corporation (“West”) by Apollo...more

A&O Shearman

“You’re Not Fully Clean”: § 220 Inspection Demands Under Corwin

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On December 29, 2017, the Delaware Court of Chancery declined to extend the ruling in Corwin by finding that the approval of a merger by a vote of the disinterested stockholders does not act as an impediment to a properly...more

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