Bouchard Tosses 'Unocal' Arguments in Merger Challenge, Favoring Business Judgment Rule
The Delaware Court of Chancery has dismissed a lawsuit by former stockholders of Paramount Gold and Silver Corp., who had tried to sidestep the court's high bar for post-closing merger challenges.
April 13, 2017 at 05:30 PM
4 minute read
The Delaware Court of Chancery has dismissed a lawsuit by former stockholders of Paramount Gold and Silver Corp., who had tried to sidestep the court's high bar for post-closing merger challenges.
The ruling, issued Thursday by Chancellor Andre G. Bouchard, was the latest to invoke the board-friendly business judgment rule under the state Supreme Court's 2015 holding in Corwin v. KKR Financial Holdings. Under that standard, directors are generally protected from lawsuits, so long as a transaction had been approved by a majority of uncoerced, fully informed and disinterested stockholders.
In the case In re Paramount Gold and Silver, however, the plaintiffs attempted an end-run around what has proved to be a formidable obstacle in the early stages of stockholder litigation.
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