Salladay v. Lev, 2020 Del. Ch. LEXIS 78, 2020 WL 954032 (Del. Ch. Feb. 27, 2020) (Glasscock, V.C.)

  • Salladay v. Lev, 2020 Del. Ch. LEXIS 78, 2020 WL 954032 (Del. Ch. Feb. 27, 2020) (Glasscock, V.C.)

The Delaware Court of Chancery recently confirmed in Salladay v. Lev that conditioning a conflicted (but non-controller) transaction upon approval by a fully empowered, disinterested and independent special committee can restore the business judgment standard of review for the transaction (rather than the more burdensome entire fairness standard that would otherwise apply). However, the court (in an opinion by Vice Chancellor Glasscock) found that such special committee “cleansing” works only if the special committee protections are put in place prior to the commencement of discussions about what might constitute an acceptable price. In Salladay, the court held that the company chairman’s discussions with the acquirer regarding price created a price collar before the special committee was formed that set the tone for future negotiations, and therefore, the special committee’s approval of the transaction did not restore the business judgment standard of review.

via Cooley, Potter Anderson, Morris James, GD&C, S&C

MFW-M&F-Swomley

Francis Pileggi writes:

A recent Delaware Supreme Court decision, in a one-page Order, affirmed a decision by the Court of Chancery that appears to have been the first application of a deferential standard announced by Delaware’s high court in the case of Kahn v. M & F Worldwide Corp., Del. Supr., No. 334, 2013 (March 14, 2014), highlighted on these pages. The one-page en banc Order of affirmance was entered in the matter of Swomley v. Schlecht, et al., [SynQor], No. 180, 2015, Order (Del. Nov. 19, 2015).

In re KKR Financial Holdings LLC Shareholder Litigation, 2014 WL 5151285 (Del. Ch. Oc. 14, 2014) (Bouchard, C.)

事業上の繋がりがある会社との買収事案において,買収者が支配株主ではないと認められ,また,過半数の取締役について独立性が認められ,経営判断原則が適用となった事例。

For the reasons explained below, I conclude that it is not reasonably i nferable from the complaint that KKR was a controlling stockholder of KFN or that a majority of the KFN board was not disinterested or independent . I also conclude that, even if the majority of the KFN board was not disinterested or independent, business judgment review still applies because the merger was approved by a majority of disinterested KFN stockholders in a fully informed vote . Thus, all three claims in the complaint will be dismissed for failure to state a claim upon which relief can be granted

via Stephen Bainbridge, Wachtell Lipton Rosen & Katz, Delaware Business Litigation Report

In re MFW Shareholders Litigation, 67 A.3d 496 (Del. Ch. 2013)

デラウェア州衡平法裁判所のStrine首席裁判官が,2013年5月29日のIn re MFW Shareholders Litigation, 67 A.3d 496 (Del. Ch. 2013) (Strine, C.)において,合併を用いた審査基準で,business judgment ruleを用いるための次の6つの条件を示しました。

(i) the controller conditions the procession of the transaction on the approval of both a special committee and a majority of the minority stockholders, (ii) the special committee is independent, (iii) the special committee is empowered to freely select its own advisors and to say no definitively, (iv) the special committee meets its duty of care, (v) the vote of the minority is informed, and (vi) there is no coercion of the minority.

Freezeoutsにおける審査基準に興味があるのであれば,とても興味深い判決だと思います。

via The CLS Blue Sky Blog, Delaware Business Litigation Report, DealLawyers.com, ProfessorBainbridge.com, M&A Law Prof Blog, DP&W, RL&F, Delaware Corporate & Commercial Litigation Blog, ST&B, PWRWG, S&C, L&W, WSGR, SASMF