Corporate Defense and Disputes

Important developments in U.S. securities law, white collar criminal defense, regulatory enforcement and other emerging issues impacting financial services institutions, publicly traded companies and private investment funds

Tag Archives: M&A

N.Y. Court of Appeals Adopts Business Judgment Rule, with Conditions, for Going-Private Mergers

The New York Court of Appeals has followed Delaware in holding that the business-judgment rule applies to going-private mergers as long as certain shareholder-protective measures are met. The court’s May 5, 2016 decision in In the Matter of Kenneth Cole Productions, Inc. Shareholder Litigation, Case No. 54, adopts the standard set forth by the Delaware Supreme … Continue Reading

Investors Fight Back – Court Battle Could Determine Scope of HSR Act Exemption

When an enforcement action for a violation of the Hart-Scott-Rodino Act is announced, chances are the matter has already come to a close – by the time the action becomes public, the agency and the parties usually have agreed upon financial penalties and other sanctions to be levied. But that is not the case for … Continue Reading

Delaware Court of Chancery Rejects Another Disclosure-Only M&A Settlement and Warns of “Increasingly Vigilant” Scrutiny

The Delaware Court of Chancery last week dealt another blow to disclosure-only settlements of merger litigation and refused to approve a proposed class-action settlement arising from Zillow, Inc.’s acquisition of Trulia, Inc. The court’s decision held that the supplemental disclosures that formed the basis of the settlement were not “material or even helpful to Trulia’s … Continue Reading

A Farewell to Alms? Peppercorn Settlements of M&A Litigation

An apparently frustrated Delaware Vice Chancellor recently approved yet another disclosure-only settlement of yet another challenge to a merger, but seemed intent on signaling that such proposed class-action settlements might not fare so well in the future.  Vice Chancellor Glasscock’s September 17, 2015 decision in In re Riverbed Technology, Inc. Stockholders Litigation (Del. Ch. Ct.) repeatedly … Continue Reading

Delaware Supreme Court Holds Tooley Direct vs. Derivative Rule Is No Bar to Parent Corporation’s Contract Claim

As previously reported, in NAF Holdings, LLC v. Li & Fung (Trading) Limited, 772 F.3d 740 (2d Cir. 2014), the Second Circuit certified to the Delaware Supreme Court an unusual question regarding whether the direct vs. derivative test for stockholder claims would bar a direct breach of contract claim by a parent corporation whose subsidiary … Continue Reading

Goodyear Pays for the Acts of its Subsidiaries in a $16 Million FCPA Settlement

Following recent trends, the U.S. Securities and Exchange Commission brought an administrative proceeding against a U.S. issuer for the alleged corrupt activities of its foreign subsidiaries. Earlier this week, Goodyear Tire & Rubber Company agreed to pay the SEC over $16 million to settle charges alleging that it violated the accounting provisions of the Foreign … Continue Reading

Applying Delaware’s Direct vs. Derivative Analysis to Contract Claims

In NAF Holdings, LLC v. Li & Fung (Trading) Limited, 2014 WL 6462825 (2d Cir. Nov. 19, 2014), the Second Circuit considered, but did not decide, whether the usual direct/derivative analysis governing minority stockholder claims against corporate fiduciaries should also apply to bar a contract claim against an unaffiliated outsider.  Finding itself unable to resolve this issue … Continue Reading

DOJ Releases Second FCPA Opinion of 2014

The U.S. Department of Justice recently publicized its second Foreign Corrupt Practices Act Opinion Procedure Release of 2014.  In the Release, the DOJ reiterated that an acquiring company may not inherit FCPA liability when the DOJ did not have jurisdiction over the target company’s prior corrupt activities. The DOJ has repeatedly asserted that, through principles … Continue Reading
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