Parties to commercial agreements often include provisions that seek to remove or limit potential roadblocks to injunctive relief in the event of a breach. A recent decision from the Delaware Chancery Court shows that one such provision — the waiver of a bond requirement for a preliminary injunction — is not ironclad.
https://ma-litigation.sidley.com/wp-content/uploads/sites/3/2022/08/sidleyLogo-e1643922598198.png00Jim Ducayethttps://ma-litigation.sidley.com/wp-content/uploads/sites/3/2022/08/sidleyLogo-e1643922598198.pngJim Ducayet2022-08-18 11:44:522023-09-08 10:58:02To Bond Or Not To Bond: Enforceability Of Contractual Waivers Of Bond Requirements For Injunctive Relief
The Delaware Court of Chancery recently denied a motion to dismiss stockholder derivative claims against Carvana Co. arising out of a stock offering Carvana announced in March 2020. The Court found that, based on the plaintiff’s allegations, it was reasonably conceivable that the stock offering had been orchestrated to take advantage of pandemic-related market volatility to benefit investors hand-selected by Carvana’s controlling stockholders. In doing so, the Court rejected the defendants’ arguments of demand futility and provided useful guidance regarding the types of allegations necessary to establish a director’s lack of independence.
https://ma-litigation.sidley.com/wp-content/uploads/sites/3/2022/08/sidleyLogo-e1643922598198.png00Ian M. Rosshttps://ma-litigation.sidley.com/wp-content/uploads/sites/3/2022/08/sidleyLogo-e1643922598198.pngIan M. Ross2022-08-02 10:03:192023-09-08 10:58:54“Thick-As-Thieves” Narrative Persuades Court That Director Independence Is In Question in Carvana
Readers who have been around for the past couple of decades will recall well a simpler time in our national politics, when the leader of the free world contended that he had not lied when telling aides, regarding a relationship with a White House intern, that “There’s nothing going on between us” because “It depends on what the meaning of ‘is’ is.”
https://ma-litigation.sidley.com/wp-content/uploads/sites/3/2022/08/sidleyLogo-e1643922598198.png00Andrew W. Sternhttps://ma-litigation.sidley.com/wp-content/uploads/sites/3/2022/08/sidleyLogo-e1643922598198.pngAndrew W. Stern2022-07-28 12:18:292023-09-08 10:59:55Grammarian’s Delight: It Depends On What The Meaning Of “And” Is
This post continues our prior discussion of Vice Chancellor Laster’s motion to dismiss denial in Goldstein v. Denner. “Part II” of that decision focuses on interesting – and rarely addressed – matters relating to Delaware law insider trading claims pursuant to Brophy v. Cities Service Co, 70 A.2d 5 (Del. Ch. 1949).
In a recent split decision in Diep v. Trimaran Pollo Partners LLC et al., the Delaware Supreme Court, sitting en banc, addressed the level of independence required of members of Special Litigation Committees recommending dismissal of shareholder derivative actions. (more…)
https://ma-litigation.sidley.com/wp-content/uploads/sites/3/2022/08/sidleyLogo-e1643922598198.png00Heather Benzmiller Sultanianhttps://ma-litigation.sidley.com/wp-content/uploads/sites/3/2022/08/sidleyLogo-e1643922598198.pngHeather Benzmiller Sultanian2022-07-13 10:27:502023-09-08 11:01:33Don’t Let the Fox in the Henhouse: Lessons from the El Pollo Loco Decision on Special Litigation Committee Independence
Sidley is pleased to share the June 2022 issue of Sidley Perspectives on M&A and Corporate Governance, a quarterly newsletter designed to keep you current on what we consider to be the most important legal developments involving M&A and corporate governance matters. (more…)
New structures, new rules? Delaware’s Chancery Court provides guidance on disclosure, conflicts, and risk allocation. We take a look at the latest Delaware rulings and what they say about SPAC directors’ fiduciary duty, as well as COVID’s effect on M&A deals, and how corporations and boards can mitigate their liability. Join host and Sidley partner, Sam Gandhi, as he speaks with two of the firm’s thought leaders on these subjects — Jim Ducayet and Charlotte Newell. (more…)
https://ma-litigation.sidley.com/wp-content/uploads/sites/3/2022/08/sidleyLogo-e1643922598198.png00Jim Ducayethttps://ma-litigation.sidley.com/wp-content/uploads/sites/3/2022/08/sidleyLogo-e1643922598198.pngJim Ducayet2022-02-15 13:28:122022-12-05 11:24:53Litigation Trends in Delaware and How Businesses and Boards Can Mitigate Risk
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To Bond Or Not To Bond: Enforceability Of Contractual Waivers Of Bond Requirements For Injunctive Relief
Parties to commercial agreements often include provisions that seek to remove or limit potential roadblocks to injunctive relief in the event of a breach. A recent decision from the Delaware Chancery Court shows that one such provision — the waiver of a bond requirement for a preliminary injunction — is not ironclad.
(more…)
Jim Ducayet
Chicago
jducayet@sidley.com
Chris D. Barnes
“Thick-As-Thieves” Narrative Persuades Court That Director Independence Is In Question in Carvana
The Delaware Court of Chancery recently denied a motion to dismiss stockholder derivative claims against Carvana Co. arising out of a stock offering Carvana announced in March 2020. The Court found that, based on the plaintiff’s allegations, it was reasonably conceivable that the stock offering had been orchestrated to take advantage of pandemic-related market volatility to benefit investors hand-selected by Carvana’s controlling stockholders. In doing so, the Court rejected the defendants’ arguments of demand futility and provided useful guidance regarding the types of allegations necessary to establish a director’s lack of independence.
(more…)
Ian M. Ross
Miami
iross@sidley.com
Grammarian’s Delight: It Depends On What The Meaning Of “And” Is
Readers who have been around for the past couple of decades will recall well a simpler time in our national politics, when the leader of the free world contended that he had not lied when telling aides, regarding a relationship with a White House intern, that “There’s nothing going on between us” because “It depends on what the meaning of ‘is’ is.”
(more…)
Andrew W. Stern
New York
astern@sidley.com
Delaware Chancery Court Addresses Insider Trading Claims Under Brophy
This post continues our prior discussion of Vice Chancellor Laster’s motion to dismiss denial in Goldstein v. Denner. “Part II” of that decision focuses on interesting – and rarely addressed – matters relating to Delaware law insider trading claims pursuant to Brophy v. Cities Service Co, 70 A.2d 5 (Del. Ch. 1949).
(more…)
Jon Muenz
New York
jmuenz@sidley.com
Lia M. Higgins
Don’t Let the Fox in the Henhouse: Lessons from the El Pollo Loco Decision on Special Litigation Committee Independence
In a recent split decision in Diep v. Trimaran Pollo Partners LLC et al., the Delaware Supreme Court, sitting en banc, addressed the level of independence required of members of Special Litigation Committees recommending dismissal of shareholder derivative actions. (more…)
Heather Benzmiller Sultanian
Chicago
hsultanian@sidley.com
Maseeh Moradi
Chicago
mmoradi@sidley.com
Sidley Perspectives on M&A and Corporate Governance
Sidley is pleased to share the June 2022 issue of Sidley Perspectives on M&A and Corporate Governance, a quarterly newsletter designed to keep you current on what we consider to be the most important legal developments involving M&A and corporate governance matters. (more…)
Enhanced Scrutiny Contributors
delawarelit@sidley.com
Litigation Trends in Delaware and How Businesses and Boards Can Mitigate Risk
New structures, new rules? Delaware’s Chancery Court provides guidance on disclosure, conflicts, and risk allocation. We take a look at the latest Delaware rulings and what they say about SPAC directors’ fiduciary duty, as well as COVID’s effect on M&A deals, and how corporations and boards can mitigate their liability. Join host and Sidley partner, Sam Gandhi, as he speaks with two of the firm’s thought leaders on these subjects — Jim Ducayet and Charlotte Newell.
(more…)
Jim Ducayet
Chicago
jducayet@sidley.com
Samir A. Gandhi
New York
sgandhi@sidley.com
Charlotte K. Newell
New York
cnewell@sidley.com
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Andrew W. Stern
astern@sidley.com
Charlotte K. Newell
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Elizabeth Y. Austin
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Jaime A. Bartlett
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Jim Ducayet
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Yolanda C. Garcia
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James Heyworth
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Alex J. Kaplan
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Jodi E. Lopez
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Ian M. Ross
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Hille R. Sheppard
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Heather Benzmiller Sultanian
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Robert S. Velevis
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Robin E. Wechkin
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