On January 24, 2024, the U.S. Securities and Exchange Commission (SEC) adopted final rules relating to special purpose acquisition companies (SPACs) and de-SPAC transactions. While the final rules substantially track the rules originally proposed in March 2022, the SEC elected not to adopt two provisions that had received significant attention and changed market behavior. The final rules also modified the SEC’s guidance and requirements for the inclusion of projections in all SEC filings by both SPAC and non-SPAC issuers.
https://ma-litigation.sidley.com/wp-content/uploads/sites/3/2022/12/MN-18360_Updated-Enhanced-Scrutiny-Blog-imagery_833x606_13.jpg606833Michael P. Heinzhttps://ma-litigation.sidley.com/wp-content/uploads/sites/3/2022/08/sidleyLogo-e1643922598198.pngMichael P. Heinz2024-01-30 10:13:002024-02-06 12:57:06SEC Adopts Final Rules Regarding Special Purpose Acquisition Companies and De-SPAC Transactions
I. Overview of Enforceability of Forum Selection Clauses
The Delaware Court of Chancery has promoted the use of forum selection clauses in corporate charters since its 2010 opinion In re Revlon Inc. Shareholders Litigation. Three years later, in Boilermakers v. Chevron, the Delaware Court of Chancery ruled that forum selection clauses in corporate bylaws are facially valid for types of shareholder litigation, including derivative claims, fiduciary claims, statutory claims under the Delaware General Corporation Law, and claims regarding internal affairs. In light of these decisions, Delaware forum selection clauses contained in corporate charters or bylaws of the type found facially valid in Boilermakers have been enforced by state courts in many states. But a recent decision from a California appellate court suggests that some California courts may be resistant to such provisions based on California public policy in favor of the right to a jury trial.
https://ma-litigation.sidley.com/wp-content/uploads/sites/3/2022/08/sidleyLogo-e1643922598198.png00Robert S. Velevishttps://ma-litigation.sidley.com/wp-content/uploads/sites/3/2022/08/sidleyLogo-e1643922598198.pngRobert S. Velevis2024-01-23 09:05:442025-09-30 14:34:50Protecting Its “Unwaivable Right to a Jury Trial,” California Waves Goodbye to a Delaware Forum Selection Clause
The Delaware Court of Chancery rang in the new year with a decision calling into question certain provisions in a company’s advance notice bylaws, which had been adopted in the face of an upcoming proxy fight. On the whole, the Kellner v. AIM Immunotech Inc. decision is yet another reminder of the critical importance of advance notice bylaws and that they are often enforced by Delaware courts. But companies should work with counsel to consider the impact of this decision on their own bylaws, bearing in mind that considerations may change based on the outcome of a now-pending appeal in Kellner.
https://ma-litigation.sidley.com/wp-content/uploads/sites/3/2022/08/sidleyLogo-e1643922598198.png00Charlotte K. Newellhttps://ma-litigation.sidley.com/wp-content/uploads/sites/3/2022/08/sidleyLogo-e1643922598198.pngCharlotte K. Newell2024-01-18 10:07:262024-01-18 10:15:34New Year’s Surprise: Portions of Cloudy Day Advance Notice Bylaw Amendments Called into Question
Last month, Vice Chancellor Glasscock dismissed shareholder claims in Teamsters Local 443 Health Services & Insurance Plan v. John C. Chou (Del. Ch. Nov. 17, 2023) (“Teamsters II”) after finding that a single-member special litigation committee (“SLC”) had sufficiently investigated the stockholder’s allegations before recommending dismissal. Vice Chancellor Glasscock’s decision is not the first time that the Court of Chancery approved a single-member SLC’s motion to dismiss a derivative suit. For example, in April 2023, Vice Chancellor Lori W. Will granted a single-member SLC’s motion to terminate a shareholder action In re Baker Hughes Derivative Litig., 2023 WL 2967780 (Del. Ch. Apr. 17, 2023).
https://ma-litigation.sidley.com/wp-content/uploads/sites/3/2023/09/MN-18360_Updated-Enhanced-Scrutiny-Blog-imagery_833x606_17.jpg606833Ian M. Rosshttps://ma-litigation.sidley.com/wp-content/uploads/sites/3/2022/08/sidleyLogo-e1643922598198.pngIan M. Ross2024-01-10 10:27:132024-03-13 17:18:36Don’t Go It Alone? Or Do. Delaware Chancery Court Rules That A Single-Member Special Litigation Committee’s Recommendation Passes Muster
When an M&A deal closes, is it done? Not always. More and more disputes are arising after closing, which results in lost time and expense for both buyers and sellers as they realize they don’t actually have a done deal. Not all disputes after closing can be avoided, but their effects can be minimized with the right due diligence, transparency in the process, and knowing the mechanisms for resolving them efficiently.
https://ma-litigation.sidley.com/wp-content/uploads/sites/3/2022/08/sidleyLogo-e1643922598198.png00Samir A. Gandhihttps://ma-litigation.sidley.com/wp-content/uploads/sites/3/2022/08/sidleyLogo-e1643922598198.pngSamir A. Gandhi2024-01-09 10:06:002024-01-09 10:07:00Is Your M&A Contract Vulnerable to Post-Closing Litigation? We Break it Down
In a significant decision the week before the Christmas holiday, the Delaware Supreme Court, sitting en banc, reversed the Delaware Court of Chancery’s dismissal of Lebanon County Employees’ Retirement Fund v. Collis et al. (“Lebanon”), reinstating stockholder derivative claims against the directors of AmerisourceBergen Corporation arising out of the Company’s wholesale distribution of prescription opioids in the United States. Interested readers can view our blog’s prior discussion of the Court of Chancery’s dismissal here.
https://ma-litigation.sidley.com/wp-content/uploads/sites/3/2022/08/sidleyLogo-e1643922598198.png00Vincent J. Margiottahttps://ma-litigation.sidley.com/wp-content/uploads/sites/3/2022/08/sidleyLogo-e1643922598198.pngVincent J. Margiotta2024-01-04 09:05:352025-09-30 14:35:15A Judicial Notice That Judicial Notice Has Its Limits
https://ma-litigation.sidley.com/wp-content/uploads/sites/3/2023/12/MN-18360_Updated-Enhanced-Scrutiny-Blog-imagery_833x606_5.jpg606833Elizabeth Y. Austinhttps://ma-litigation.sidley.com/wp-content/uploads/sites/3/2022/08/sidleyLogo-e1643922598198.pngElizabeth Y. Austin2023-12-26 10:12:542024-02-06 12:55:57Unfettered Does Not Mean Unlimited: Two New Delaware Decisions Shed Light on the Limitations of Inspection Rights
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SEC Adopts Final Rules Regarding Special Purpose Acquisition Companies and De-SPAC Transactions
On January 24, 2024, the U.S. Securities and Exchange Commission (SEC) adopted final rules relating to special purpose acquisition companies (SPACs) and de-SPAC transactions. While the final rules substantially track the rules originally proposed in March 2022, the SEC elected not to adopt two provisions that had received significant attention and changed market behavior. The final rules also modified the SEC’s guidance and requirements for the inclusion of projections in all SEC filings by both SPAC and non-SPAC issuers.
(more…)
Michael P. Heinz
New York, Chicago
mheinz@sidley.com
Joshua G. DuClos
Century City
jduclos@sidley.com
Sonia Gupta Barros
Washington, D.C.
sbarros@sidley.com
W. Hardy Callcott
San Francisco
wcallcott@sidley.com
Jim Ducayet
Chicago
jducayet@sidley.com
Nathan J. Greene
New York
ngreene@sidley.com
James Heyworth
New York
jheyworth@sidley.com
David Ni
New York
dni@sidley.com
Protecting Its “Unwaivable Right to a Jury Trial,” California Waves Goodbye to a Delaware Forum Selection Clause
I. Overview of Enforceability of Forum Selection Clauses
The Delaware Court of Chancery has promoted the use of forum selection clauses in corporate charters since its 2010 opinion In re Revlon Inc. Shareholders Litigation. Three years later, in Boilermakers v. Chevron, the Delaware Court of Chancery ruled that forum selection clauses in corporate bylaws are facially valid for types of shareholder litigation, including derivative claims, fiduciary claims, statutory claims under the Delaware General Corporation Law, and claims regarding internal affairs. In light of these decisions, Delaware forum selection clauses contained in corporate charters or bylaws of the type found facially valid in Boilermakers have been enforced by state courts in many states. But a recent decision from a California appellate court suggests that some California courts may be resistant to such provisions based on California public policy in favor of the right to a jury trial.
(more…)
Robert S. Velevis
Dallas
rvelevis@sidley.com
Maggie Gianvecchio
Dallas
mianvecchio@sidley.com
New Year’s Surprise: Portions of Cloudy Day Advance Notice Bylaw Amendments Called into Question
The Delaware Court of Chancery rang in the new year with a decision calling into question certain provisions in a company’s advance notice bylaws, which had been adopted in the face of an upcoming proxy fight. On the whole, the Kellner v. AIM Immunotech Inc. decision is yet another reminder of the critical importance of advance notice bylaws and that they are often enforced by Delaware courts. But companies should work with counsel to consider the impact of this decision on their own bylaws, bearing in mind that considerations may change based on the outcome of a now-pending appeal in Kellner.
(more…)
Charlotte K. Newell
New York
cnewell@sidley.com
Maya S. Shair
Associate
mshair@sidley.com
Loren Braswell
Don’t Go It Alone? Or Do. Delaware Chancery Court Rules That A Single-Member Special Litigation Committee’s Recommendation Passes Muster
Last month, Vice Chancellor Glasscock dismissed shareholder claims in Teamsters Local 443 Health Services & Insurance Plan v. John C. Chou (Del. Ch. Nov. 17, 2023) (“Teamsters II”) after finding that a single-member special litigation committee (“SLC”) had sufficiently investigated the stockholder’s allegations before recommending dismissal. Vice Chancellor Glasscock’s decision is not the first time that the Court of Chancery approved a single-member SLC’s motion to dismiss a derivative suit. For example, in April 2023, Vice Chancellor Lori W. Will granted a single-member SLC’s motion to terminate a shareholder action In re Baker Hughes Derivative Litig., 2023 WL 2967780 (Del. Ch. Apr. 17, 2023).
(more…)
Ian M. Ross
Miami
iross@sidley.com
Eric Gordon
Is Your M&A Contract Vulnerable to Post-Closing Litigation? We Break it Down
When an M&A deal closes, is it done? Not always. More and more disputes are arising after closing, which results in lost time and expense for both buyers and sellers as they realize they don’t actually have a done deal. Not all disputes after closing can be avoided, but their effects can be minimized with the right due diligence, transparency in the process, and knowing the mechanisms for resolving them efficiently.
(more…)
Samir A. Gandhi
New York
sgandhi@sidley.com
Robert S. Velevis
Dallas
rvelevis@sidley.com
Frank J. Favia, Jr.
Alexis Cooper
Chicago
acooper@sidley.com
A Judicial Notice That Judicial Notice Has Its Limits
In a significant decision the week before the Christmas holiday, the Delaware Supreme Court, sitting en banc, reversed the Delaware Court of Chancery’s dismissal of Lebanon County Employees’ Retirement Fund v. Collis et al. (“Lebanon”), reinstating stockholder derivative claims against the directors of AmerisourceBergen Corporation arising out of the Company’s wholesale distribution of prescription opioids in the United States. Interested readers can view our blog’s prior discussion of the Court of Chancery’s dismissal here.
(more…)
Vincent J. Margiotta
New York
vmargiotta@sidley.com
Andrew W. Stern
New York
astern@sidley.com
Unfettered Does Not Mean Unlimited: Two New Delaware Decisions Shed Light on the Limitations of Inspection Rights
As this blog has highlighted, a number of judicial decisions on statutory demands to inspect books and records under Delaware’s Section 220 in recent years have emphasized the broad scope of types of materials to which courts will permit access, and the consequences faced by companies that have attempted to restrict access. Two recent Delaware Court of Chancery decisions provide a welcome reminder of the limitations on the scope of the inspection right. These cases are Jose Mellado, D.M.D. v. ACPDO Parent Inc. and Greenlight Capital Offshore Partners, LTD. v. Brighthouse Financial, Inc.
(more…)
Elizabeth Y. Austin
Chicago
laustin@sidley.com
Rachel A. Rein
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Alex J. Kaplan
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