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Standard of Review Corporate Governance

A&O Shearman

Delaware Court Of Chancery Holds That Corwin Cleansing Applies To Claims Related To Reduction Of Acquisition Price

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On June 21, 2024, Vice Chancellor Nathan A. Cook of the Delaware Court of Chancery granted a motion to dismiss a putative stockholder class action asserting breach of fiduciary duty claims against the officers and directors...more

Lathrop GPM

Delaware Supreme Court Clarifies Standard of Review for Conflicted Stockholder Transactions with In re Match Group Opinion

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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

A&O Shearman

Court Of Chancery Rescinds CEO Compensation Package Under Entire Fairness Review

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In a January 30, 2024, post-trial ruling, Vice Chancellor Kathaleen St. J. McCormick of the Delaware Court of Chancery rescinded a compensation package valued at $55.8 billion awarded by Tesla, Inc. to its CEO,...more

A&O Shearman

Applying Unocal, Delaware Court Of Chancery Upholds Board’s Denial Of Stockholder’s Director Nomination Notice Pursuant To Amended...

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On December 28, 2023, Vice Chancellor Lori W. Will of the Delaware Court of Chancery issued a post-trial ruling upholding the decision by the board of directors of AIM Immunotech Inc. to reject a director nomination notice...more

A&O Shearman

Delaware Supreme Court Affirms Decision Rejecting Fiduciary Duty Claims As To Allegedly Conflicted Acquisition Because It...

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On June 6, 2023, in an opinion authored by Justice Karen L. Valihura, the Supreme Court of Delaware sitting en banc unanimously affirmed judgment in favor of defendant, the CEO/Founder and then-Chairman (the “Chairman”) of...more

A&O Shearman

Delaware Court Of Chancery Concludes Founder And Largest Shareholder Was Not A Controller In Connection With Allegedly Conflicted...

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On May 12, 2023, Vice Chancellor Sam Glasscock III of the Delaware Court of Chancery ruled in favor of defendant, the founder and largest shareholder (the “Founder”) of a technology company (the “Company”), on derivative...more

A&O Shearman

Delaware Court Of Chancery Holds That Corwin Cleansing Does Not Apply To Claims For Injunctive Relief Related To Alleged Defensive...

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On May 1, 2023, Vice Chancellor Morgan T. Zurn of the Delaware Court of Chancery denied a motion to dismiss a putative stockholder class action asserting a breach of fiduciary duty claim against the directors of a...more

Skadden, Arps, Slate, Meagher & Flom LLP

Court of Chancery Dismisses Caremark Claims Because of Reporting Systems

Delaware courts have historically been reluctant to allow Caremark (or “board oversight”) claims to gain traction, describing such a claim as “possibly the most difficult theory in corporation law upon which a plaintiff might...more

Skadden, Arps, Slate, Meagher & Flom LLP

Current Bounds on Books and Records Demands

For decades, Delaware courts have encouraged stockholders to use the “tools at hand” — before initiating lawsuits — by obtaining corporations’ books and records through 8 Del. C. § 220 (Section 220). As described in prior...more

Skadden, Arps, Slate, Meagher & Flom LLP

Insights: The Delaware Edition - December 2022

In this issue, we discuss recent Delaware court decisions further developing the bounds around books and records demands. Other articles focus on recent developments concerning advance notice bylaws and the standards used by...more

DarrowEverett LLP

Life May Not Be Fair, But Interested Party Transactions Should Be

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When a court reviews contested business transactions of a Delaware corporation, they typically rely on one of two standards of review: the “business judgment rule” or the “entire fairness standard.” The business judgment rule...more

A&O Shearman

Delaware Court Of Chancery Dismisses Stockholder Challenge To Certificate Of Incorporation Amendment Prolonging Voting Control By...

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On April 11, 2022, Vice Chancellor Paul A. Fiorvanti of the Delaware Court of Chancery dismissed a stockholder challenge to an amendment of the certificate of incorporation of The Trade Desk, Inc. (the “Company”).  According...more

Skadden, Arps, Slate, Meagher & Flom LLP

Delaware Courts Continue To Enforce Unambiguous Advance Notice Bylaws, But Incumbent Director Conduct Remains Subject to Equitable...

In early 2020, in BlackRock Credit Allocation Income Tr., et al. v. Saba Capital Master Fund, Ltd., the Delaware Supreme Court reiterated that Delaware courts will enforce clear and unambiguous advance notice bylaws according...more

A&O Shearman

Delaware Court Of Chancery Rejects Challenge To Board’s Enforcement Of Advance Notice Bylaw

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On October 13, 2021, Vice Chancellor Joseph R. Slights of the Delaware Court of Chancery denied a request for injunctive relief in a stockholder action against the board of CytoDyn (the “Company”).  Rosenbaum v. Cyotodyn...more

Cadwalader, Wickersham & Taft LLP

Blasius Is Alive and Well in Delaware: Delaware Supreme Court Chides Chancery for Turning Away Stockholder’s Claims Without...

Despite being one of the more well-known doctrines in corporate law, the rule articulated in Blasius—that directors who act with the primary purpose of interfering with a stockholder vote must have a compelling justification...more

Womble Bond Dickinson

Recent Director and Executive Compensation Lawsuits Heighten Need for Robust Corporate Governance

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Over the past two years, there has been an uptick in the number of lawsuits challenging director and executive compensation. Cases such asIn Re: Investors Bancorp, Stein v. Blankfein, Hertz v. Frissora and, most recently,...more

White and Williams LLP

Delaware Chancery Court Opens Discussion of Enhanced-Independence Director Deference for Controller Transactions

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Delaware courts evaluate a self-dealing transaction with a controlling stockholder through the lens of entire fairness — meaning that both the deal process and price must be deemed fair. The burden of proving entire fairness...more

Snell & Wilmer

Director Compensation Update

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The following is an update to an important Delaware case relating to the applicable standard of review for challenged actions involving the setting of director compensation. ...more

Skadden, Arps, Slate, Meagher & Flom LLP

Activists at the Gate: Court of Chancery Weighs In on Claims Involving Activist Stockholders

Several recent decisions applying Delaware law offer helpful insight about the impact that activist investor involvement has on board decision-making leading to a transaction and how those decisions will be reviewed by the...more

Skadden, Arps, Slate, Meagher & Flom LLP

Insights: The Delaware Edition - October 2015

We are pleased to share with you the inaugural issue of Insights: The Delaware Edition, a periodic publication addressing significant Delaware deal litigation and corporation law developments. In This Issue: - Q&A...more

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