Showing 5 posts in Parsons.
The 21st Tulane Corporate Law Institute Begins Tomorrow
Here is the brochure for the program, which takes place April 2-3. The panelists are among the most respected and knowledgeable legal minds and financial experts involved in corporate law and M&A, including Chief Justice Myron T. Steele and Justice Jack B. Jacobs of the Delaware Supreme Court and Vice Chancellors Leo E. Strine, Jr., Stephen P. Lamb, and Donald F. Parsons, Jr., of the Delaware Court of Chancery.Share
Court of Chancery Denies Standing For Lost Shares
Postorivo v. AG Paintball Holdings Inc., C.A. No. 2991-VCP (Del. Ch. February 29, 2008)
It has long been recognized that a stockholder may lose her standing to bring derivative litigation by losing her shares in a merger. There is a recognized exception to this rule for mergers designed just to eliminate derivative litigation.
Here, the plaintiff sold the assets of his company in return for cash and stock in the buyer. The stock was held in escrow and when a dispute arose, the buyer revoked the stock as compensation for its claims against the seller. When the seller brought a derivative suit, the court dismissed it as he no longer owned stock in the buyer. Thus, the court refused to make another exception to the rule that a derivative plaintiff must continue to be a stockholder through out the litigation.
Court of Chancery Dismisses Suit Over Decision To Not Pursue A Merger
Gantler v. Stephens, C .A. No. 2392-VCP (February 14, 2008).
This decision illustrates the confusion that exists over the scope of review of a board's decision to not pursue a merger and largely eliminates the uncertainty. Briefly, the board here decided not to pursue a merger opportunity and the potential acquirer then withdrew its offer. The court held that the business judgment rule applied to the decision not to take the offer. In doing so, the court declined to apply the heightened scrutiny used under the Unocal decision as the board did not take any defensive steps to stop the suitor from going forward on its own.
Instead, the court held that to invoke a higher level of review, the plaintiff must show the board acted in bad faith or was not properly advised. Mere allegations that the board made the wrong decision are insufficient. More ›Share
Court of Chancery Upholds Agreement To Agree
Pharmathene Inc. v. SIGA Technologies. Inc., C.A. No. 2627-VCP (January 16, 2008).
Whether an agreement to agree may be enforced seems like an odd question. After all, if the parties really had an agreement then why not just say so and not use a term sheet or other vague type of "agreement to agree" to express their intent. This decision illustrates just why that may occur because the parties apparently were uncertain if they really wanted to bind themselves to one another just yet. Nonetheless, they did list all the essential terms of what they wanted in their contract in a term sheet and when they seemed to have acted to carry out their deal, the court here indicated it will enforce an agreement to agree when to let one party walk away seems inequitable.Share