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The parties to an appraisal of AOL Inc. stock have each filed motions seeking a rehearing of the case, asking a Delaware Court of Chancery judge to reassess the financial inputs that led him to set fair value below the $50-per-share price Verizon Communications Inc. paid to acquire the company.

Attorneys for dissenting AOL shareholders on March 2 said in an eight-page brief that Vice Chancellor Sam Glasscock III had committed a pair of “computational errors” in his Feb. 23 decision, causing more than $3 to be shaved off of the value of their shares at the time of the 2015 transaction.

AOL, on the other hand, lobbied Glasscock to scale back his finding of fair value at $48.70 per share, based on market evidence that it said went overlooked in his 51-page memorandum opinion last month. The fair value of AOL's shares instead should have been $45.54, the company's lawyers said.

The dueling motions come amid a turbulent time for petitioners looking to pursue their appraisal rights, after a pair of Delaware Supreme Court rulings signaled tighter scrutiny of the cases. In those rulings, known as Dell and DFC, the high court indicated a strong preference for using deal price as a strong indicator of fair value in an arm's length transaction.

Glasscock, however, determined that the AOL sale was not “Dell compliant” and conducted his own discounted cash flow, or DCF, analysis to reconcile wildly divergent valuations from petitioners and the company. He used the deal price only as a “check” on his calculations.

Stuart M. Grant, who represents a group of AOL shareholders that voted against the $4.4 million Verizon deal, said in a motion for reargument that Glasscock had undervalued AOL's 10-year “display deal” agreement to run the sales of display, mobile and video ads on Microsoft Corp. properties.

And he argued that Glasscock improperly attributed no value to another deal pending for AOL to replace Google's search engine with Microsoft's Bing, despite a finding that it was part of AOL's operative reality at the time of the merger.

“If a plan is part of the operative reality of the company at the time of valuation, it cannot be disregarded,” wrote Grant, managing director of Grant & Eisenhofer.

“The court erred because there is, in fact, undisputed record evidence regarding the cash flow impact of Microsoft Search.”

Attorneys for AOL said they did not initially plan to challenge the ruling, which was seen as a loss for the investors. But they said they changed their minds after the petitioners submitted an “implausible” valuation that ignored compelling market evidence to support AOL's position.

Glasscock's fair-value finding was “appreciably higher” than the $45.54 that the company's stock was actually worth when the sale closed, AOL said in a brief signed by Potter Anderson & Corroon attorney Kevin R. Shannon. He said Glasscock's opinion had already attributed more than $200 million in equity value to the display deal, a value that Shannon said was unprecedented for AOL, given the negligible impact of previous deals to compensate for declines in its legacy email business.

“It is therefore remarkable that petitioners seek to revisit this holding,” Shannon said in his motion for reconsideration.

“Under the guise of requesting that the court correct these supposed 'computational errors,' petitioners ask the court to throw out its holding that Verizon paid more than fair value for AOL,” he said. “Petitioners thus ask the court, using a DCF model, to find that a public company was undervalued in an arm's-length transaction—precisely the outcome that the Supreme Court rejected in its ruling in Dell.”

Grant, however, has been very critical of Dell and its implications for appraisal actions. Last month, he blasted as “absurd” an opinion from Vice Chancellor J. Travis Laster, which also found fair value below the deal price, and has since filed for reargument, suggesting in his brief that Laster does not agree with the legal theory he applied in the case.

Counsel for appraisal petitioners have generally argued that the Supreme Court rulings in Dell and DFC encourage judges to find fair value below the deal price, effectively stripping dissident investors of a statutory remedy available under state law.

Attorneys for the companies counter that the rulings were needed to stem the rising tide of appraisal arbitrage, where firms would buy up large amounts of companies' stock on news that a sale was imminent in order to exercise appraisal rights under the Delaware General Corporation Law. They point to a steep decline in such cases as evidence that the Supreme Court has struck the proper balance in Dell and DFC.