Delaware Business Litigation Report

Court of Chancery Denies Stay Even When Not First Filed

In re: The Topps Company Shareholder Litigation, C.A. No. 2786-VCS (Del. Ch. May 9, 2007).

The race is not always won by the first to start. In this case the Court of Chancery declined to stay a Delaware case attacking a proposed merger even though a similar New York case had been filed earlier. Explaining that the internal affairs doctrine leaves to the state of incorporation the right to decide internal corporate legal issues, the Court of Chancery held it would proceed with this case.

The opinion is noteworthy for the long footnotes reciting all the more recent decisions where the Delaware Courts have granted stockholders relief, apparently in defense of attacks on the Court for being pro-management. Of course, the Court need no defense, but it is interesting that it took the time. Share