Our Delaware Corporate and Alternative Entity Law attorneys closely follow the opinions coming from Delaware’s Supreme Court and Court of Chancery.
Our 2018 Year in Review is a collection of brief summaries of selected cases concerning Delaware Corporate and Alternative Entity Law. While this list is a selection of important cases, our intent is to provide our readers with the rationale behind a court’s holding to ultimately provide information that may be helpful in strategic and business decisions concerning litigation and commercial arrangements. Our Delaware Corporate and Alternative Entity Law attorneys are experienced in all aspects of Delaware law, including representing our clients in a variety of business transactions and Delaware opinion work. The Delaware Corporate and Alternative Entity Law attorneys also represent public and private Delaware corporations, LLCs, LPs and GPs in corporate, commercial, shareholder and other litigation in the Delaware Court of Chancery.
Sent to Bed Without Dessert: The Delaware Court of Chancery Denies Attempt to Hold Ice Cream Maker Liable for Contaminated Product (12/14/18) By Matthew Rifino
The Court of Chancery emphasizes that its dismissal of the claims against the parent corporation was well-grounded in Delaware law in that a principal may not be held vicariously liable for its agent’s non-tortious breach of a contract.
Delaware Court of Chancery Finds That Buyer Validly Terminated Merger Agreement Due to Material Adverse Effect (11/29/18) By Bernard C. Devieux
The Akorn opinion, a must-read for M&A practitioners, is said to be the first time the Court of Chancery has permitted a buyer to terminate a public company merger agreement based on a material adverse effect.
Sellers Alleged Breach of Stock Purchase Agreement Did Not Excuse Buyer in M&A Transaction from Its Own Performance; Right of Set-Off Did Not Apply to Unliquidated Claims (11/16/18) By Philip D. Amoa
Post Holdings provides a valuable lesson for buyers in merger-and-acquisition transactions in that any right of set-off or netting provision could provide a right of set-off for unliquidated claims.
Delaware Court of Chancery Explains “Best Efforts” and “Sound Business Practices” and Provides Other Valuable Lessons for Delaware Limited Partnerships (11/16/18) By Philip D. Amoa
In Wenske, the court addresses and interprets the meaning of “best efforts” and “sound business practices” in the context of a limited partnership agreement that failed to define those terms.
Limits of Stockholder Ratification Defense When Directors Make Equity Awards to Themselves (5/5/18) By Philip D. Amoa
This case reaffirms that directors awarding shares to themselves under an equity incentive plan should seek stockholder approval or ratification as to specific awards, leaving little to no discretion to the directors themselves.
Corbat and the Caremark Tradition: Directorial Negligence Does Not Mean Bad Faith (5/2/18) By Philip D. Amoa
The Delaware Court of Chancery underscores the high burden to adequately allege a Caremark claim, long familiar to practitioners as perhaps the most difficult theory in corporation law for which a plaintiff hopes to win a judgment.
That’s the Way the Cookie Crumbles: When Neither Party Prevails in the “Predominance of the Litigation,” Each Side Must Bear Its Own Attorneys’ Fees (4/27/18) By Daniel J. Brown
The Mrs. Fields Brands highlights that under Delaware law, contractual fee-shifting provisions will be enforced only when a party predominately prevails in the litigation.
Advancement Rights in Delaware Limited Partnerships (4/27/18) By Philip D. Amoa
Key takeaways from Weil involve the unilateral imposition of terms on an indemnitee’s advancement rights; for example, companies do not have the right to impose conditions on advancement other than the obligation to repay.
The Delaware Supreme Court Underscores the Significance of the Deal Price (2/23/18) By Hayley J. Reese
Although the Supreme Court refused to create a strict rule presuming the fairness of the transaction price, Dell reinforces the significance of the deal price in assessing fair value.
HBMA Holdings LLC v. LSF9 Stardust Holdings (2/7/18) By Andrew S. Dupre
A cautionary tale for commercial litigators, HBMA Holdings emphasizes the importance of including an express mention of indemnification in notices of arbitration.
If you have any questions about these topics, please contact a member of the Delaware Corporate and Alternative Entity Law team or your lawyer at McCarter & English, LLP.