A Delaware Chancery Court judge on Tuesday denied business judgment protections to the directors of telecommunications firm Tangoe Inc., saying plaintiffs could possibly show that the board withheld important information from investors during a $256 million bid to take the company—which was under intense scrutiny from regulators—private.
The ruling, from Vice Chancellor Joseph R. Slights III, refused the Tangoe board’s motion to dismiss a shareholder class action from former Tangoe investors who claim they were shortchanged in the company’s April 2017 sale to Marlin Equity Partners. Under the 2015 Delaware Supreme Court decision in Corwin v. KKR Financial Holdings, Slights said, directors failed to show that they had failed to adequately explain the deal to investors amid a time of extraordinary turmoil for the company.
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