A recent article from Law 360 [$$$] broke down the important considerations from the 2020 appraisal decisions of the Delaware Supreme Court and Delaware Court of Chancery. One of the takeaways from authors Lewis Lazarus and Bryan Townsend of Morris James LLP was statutory appraisal remains “an active area of litigation in Delaware,” notwithstanding legislation
Devon Energy Corporation seeks to have the Delaware Chancery Court validate a shareholder vote after a notice snafu resulted in approximately 15% of shareholders receiving untimely notices on a $15 billion merger. After the merger closed between Devon Energy and WPX Energy, Inc. in January 2021, Devon Energy’s sub-contractor Broadridge Investor Communication Solutions, Inc. learned
With litigation over section 220 demands becoming more frequent and contentious, the Supreme of Court Delaware weighed in an en banc ruling and affirmed shareholders’ rights to inspect a company’s books and records. In this protracted dispute which we’ve previously blogged about, AmerisourceBergen Corporation took the Chancery Court’s ruling allowing shareholders the right to inspect
Pharmaceutical company Gilead’s “overly aggressive defense strategy” received the ire of Vice Chancellor McCormick of the Delaware Court of Chancery, who found in a recent decision [$$] that shareholders easily showed they had the right to access books and records to investigate possible wrongdoing in connection with Gilead’s marketing of HIV drugs, and allowed the
AmerisourceBergen Corp. has asked the Delaware Supreme Court to reverse a Chancery Court ruling allowing shareholders the right to investigate the company’s books and records for corporate wrongdoing in connection with the opioid crisis. Amerisource Bergen argued before the full five-member panel that Vice Chancellor Laster’s prior ruling went too far and invites harassment.
Books
The SEC has recently enacted rules that make it tougher for shareholders to submit ballot proposals. As we previously blogged about, the rules now approved by the SEC by a 3-2 vote: (1) increase the monetary amounts and length of investment required to submit shareholder proposals and (2) raise the threshold of shareholder support required
As COVID-19 continues to cause uncertainty in M&A transactions, investors should have a heightened interest in pursuing the rights available to them, including appraisal and inspection rights.
For instance, the Harvard Law Forum expects that buyers who agreed on transaction terms at pre-COVID-19 valuations might seek to terminate those transactions or renegotiate the price
Kramer Levin Naftalis & Frankel LLP posted on Lexology [$$$] about the availability of so-called drag-along rights in private equity deals, which would require minority shareholders to waive rights to appraisal or otherwise challenge controlling shareholder transactions. According to the post, these drag-along rights have become standard fare in stockholder or similar agreements for controlling
In a recent appraisal decision, Delaware Vice Chancellor Slights III awarded investors a 12% premium above deal price, fully adopting the discounted cash flow analysis Petitioners tendered, except for one minor adjustment. The case involved a three-way business combination of a privately held target turned public without minority shareholder approval. The court eschewed the use
In a lengthy decision, Delaware Vice Chancellor Laster ruled that shareholders had the right to inspect the formal board materials of AmerisourceBergen Corporation and conduct a 30(b)(6) deposition to determine whether they needed additional documents, including informal board materials and officer-level documents.
In Lebanon Cty. Emp. Ret. Fund v. AmerisourceBergen Corp., stockholders sought to