everal 2024 decisions by the Delaware Court of Chancery led some prominent corporate leaders to express frustration over perceived increased liability standards for corporate officers and directors, even publicly advising new...more
Delaware Supreme Court holds business judgment rule applies to decision to reincorporate a company out of Delaware made on a “clear day.” For a non-ratable benefit to give rise to a conflict and trigger entire fairness,...more
This case stems from the proposed reincorporations of Tripadvisor, Inc. and Liberty TripAdvisor Holdings, Inc. from Delaware to Nevada, which were first presented to the corporations’ respective stockholders for approval in...more
Nearly one year ago, Vice Chancellor J. Travis Laster decided to apply Delaware's most onerous standard of review, entire fairness, to the decisions of TripAdvisor, Inc. and Liberty TripAdvisor Holdings, Inc. to reincorporate...more
Delaware’s rigorous fairness standards for transactions involving controlling shareholders have recently come to the forefront of the Chancery Court’s docket. The Transaction...more
Kormos v. Playtika Hldg. UK II Ltd., C.A. 2023-0396-SG (Del. Ch. May 3, 2024) - In this decision involving breach of fiduciary duty claims against two officers, the Court granted the individual defendants’ motions to...more
In In re Match Group Deriv. Litig., the Delaware Supreme Court affirmed in part and reversed in part the lower court’s decision on the appropriate standard of review and the application of Kahn v. M & F Worldwide Corp., 88...more
The electric vehicle company Canoo went public in a de-SPAC transaction in December 2020. After its stock price fell, a stockholder in the SPAC who chose not to redeem his stock sued the SPAC board and its controller for...more
On April 4, 2024, the Delaware Supreme Court issued a much-anticipated decision, In re Match Group Derivative Litigation (“In re Match Group”), extending the MFW doctrine more broadly to all conflicted controller...more
In a recent decision, the Delaware Supreme Court clarified the proper standard to apply to a non-freeze-out merger transaction involving a controlling stockholder. Litigators who practice in the Delaware Court of Chancery are...more
In 2014, the Delaware Supreme Court held in Kahn v. M&F Worldwide Corp. (“MFW”) that a court will apply the entire fairness standard of review to freeze-out merger transactions between a controlled corporation and its...more
In In re Match Group, Inc. Derivative Litigation, the Delaware Supreme Court held that the dual procedural protections announced in the seminal case of Kahn v. M & F Worldwide Corp. (MFW) are required in order to shift the...more
On April 4, 2024, the Delaware Supreme Court issued its opinion in In re Match Group, Inc. Derivative Litigation, clarifying that the heightened entire fairness standard of review applies to judicial review of any transaction...more
In a case with implications for companies with controlling stockholders, the Delaware Supreme Court held that the MWF Doctrine applies to any transaction involving a controlling shareholder receiving a non-ratable benefit,...more
On April 4, 2024, the Delaware Supreme Court issued its decision in In re Match Group, Inc. Derivative Litigation, holding that the MFW framework established in Kahn v. M&F Worldwide Corp. (MFW) applies to all controlling...more
In a letter ruling, the Delaware Chancery Court held that where neither the target nor the acquiror was a Delaware entity, the transaction documents between the parties could not confer jurisdiction in the Chancery Court...more
TripAdvisor and its controlling corporation, both publicly traded Delaware companies, announced plans to convert to Nevada corporations. Shareholders sued to enjoin the conversions, alleging that the boards of directors had...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
In the case of TripAdvisor Inc., the Delaware Court of Chancery held that the corporation’s decision to reincorporate in Nevada is subject to the entire fairness standard. The court found that, based on the facts pled,...more
The Case: A Tesla stockholder sued Tesla's board of directors to rescind a performance-based stock option grant awarded to Elon Musk, Tesla's CEO. The option award was worth a total of $56 billion and offered the opportunity...more
The Delaware Chancery Court invalidated a substantial equity award to Elon Musk – the largest in history. It applied the entire fairness test instead of the more deferential business judgment rule, finding that Musk...more
More often than not, the centerpiece of an intra-owner business dispute is a claim that those in control of the business breached their fiduciary duties to the company or the minority owners. While often easy to assert, the...more
On January 30, 2024, the Chancellor of the Delaware Court of Chancery struck down the $55.8 billion compensation plan that Tesla, Inc.’s board of directors had granted to Tesla’s well-known CEO, Elon Musk, finding that the...more
Special purpose acquisition companies (“SPACs”) have been in the litigation spotlight recently. As SPAC disputes play out in courts nationwide, one especially interesting field of play is in the Delaware Chancery courts where...more
Triggering Delaware’s entire fairness review in stockholder litigation was once considered outcome determinate, but that view has waned. Numerous decisions have shown that defendants can overcome the unified fair process and...more