M&A 2023-2024 Delaware Update: Caremark Duties, Busted Deal Litigation, SPAC Challenges, Unenforceable Con Ed Provisions
Implications of Major Decisions for Negotiating and Structuring Transactions
Course Details
- smart_display Format
On-Demand
- signal_cellular_alt Difficulty Level
Intermediate
- work Practice Area
Commercial Law
- event Date
Thursday, May 23, 2024
- schedule Time
1:00 p.m. ET./10:00 a.m. PT
- timer Program Length
90 minutes
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This 90-minute webinar is eligible in most states for 1.5 CLE credits.
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This CLE webinar will discuss significant Delaware court decisions rendered in 2023 and the first part of 2024 and the implications for current and future M&A practice. The panel will discuss the anticipated impact of recent Delaware court rulings on Caremark duties of oversight, breach of fiduciary duty claims arising from disclosures in SPAC transactions, Revlon judgments, lost premium damages and Con Ed provisions, "busted deal" disputes, and other issues.
Ms. DeBona’s practice focuses on representing corporate entities and their directors and officers in corporate governance and commercial litigation in the Delaware Court of Chancery.
Ms. Fortunato's ties to the local community and legal experience allow to her provide targeted legal advice to her corporate clients while keeping in focus her clients’ broader business concerns and interests. Her corporate practice focuses on the representation of corporations and alternative entities, directors, managers, stockholders and members in both commercial and corporate disputes in Delaware state and federal courts, with a concentration on matters in the Court of Chancery. Ms. Fortunato has particular experience in prosecuting and defending books and records demands and actions.
Ms. German’s practice focuses on corporate governance litigation and counseling, navigation of corporate fiduciary duties, and representation of companies and their officers and directors in stockholder class actions, derivative suits, and complex commercial litigation in the Delaware Court of Chancery and the Delaware Supreme Court. She also represents clients in stockholder class actions, derivative suits, and securities actions in the state and federal courts throughout the country. In addition, Ms. German specializes in advising companies faced with stockholder litigation and books and records demands, as well as director and officer demands for advancement and indemnification; conducting investigations on behalf of management, boards of directors, and special board or management committees; and representing companies and their boards of directors in stockholder actions and "busted deal" litigation.
In 2023 the Delaware courts issued several notable decisions defining the scope of Caremark oversight liability and the ability of a corporation to control any such litigation. The courts expanded oversight liability to include corporate officers and held that the scope of liability varies with an officer's responsibilities.
The Court of Chancery issued several opinions in "busted deal" litigation addressing situations where buyers sought to escape from contracts to acquire corporations because of purposed breaches of representations and warranties. In two such cases, the court determined that the buyers were not required to close because the representations and warranties made at signing that were affirmed as true at closing did not include any materiality qualifier.
There were several new rulings relating to SPAC challenges. In five cases, the Delaware courts held that the entire fairness standard applied to breach of fiduciary duty claims arising from de-SPAC transactions and that there were reasonably conceivable claims for breach of the fiduciary duty of loyalty arising from materially misleading public filings issued in connection with each transaction.
Plaintiffs prevailed in two cases seeking damages for violation of fiduciary duties evaluated under the Revlon standard of review. In both cases, the court found that the officers of the target preferred the eventual acquirer and took actions that steered the target to the officers' favored counterparty for unique, personal reasons.
In a novel issue, the court of chancery held that a Con Ed provision in a merger agreement that permitted the target company to sue for lost premium damages in a busted deal while disclaiming stockholders as third-party beneficiaries was unenforceable by either the target or its stockholders because it would allow for damages in excess of expectation damages.
Listen as our panel of experienced M&A attorneys reviews significant Delaware court decisions issued during 2023 and the first part of 2024 and their impact on M&A practice.
- Overview of trends in M&A litigation
- Key 2023 and 2024 rulings
- Continued evolution of Caremark duties
- Revlon judgments
- SPAC/de-SPAC litigation trends
- Match
- "Busted deal" litigation
- Lost premium provision held unenforceable
- Implications of recent cases and best practices for M&A transactional attorneys and litigators
The panel will review these and other highly relevant issues:
- How have the Delaware courts addressed the standard of review in recent cases?
- How will the 2023 and 2024 Delaware decisions reshape how deals are structured and litigated?
- What are best practices for M&A transactional attorneys and litigators in 2024 and beyond?
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