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Delaware Business Court Insider

Chancery: Common Stock Worthless in 'Jacobson v. Akademos' and Transaction Was Entirely Fair

Jacobs v. Akademos is a post-trial opinion that addresses a squeeze-out merger where Akademos’ (the company) common stockholders were provided zero consideration. Vice Chancellor Travis Laster found that the common stock was worthless for appraisal purposes and that the transaction was entirely fair.
5 minute read

Delaware Business Court Insider

The Importance of Contractual Language in Analyzing Post-Closing Earnout Disputes

A recent Delaware Superior Court decision emphasizes the importance of the language in the parties’ contract in assessing the buyers’ efforts with respect to the earnout.
6 minute read

Delaware Business Court Insider

Delaware Supreme Court Upholds Court of Chancery’s Refusal to Blue Pencil an Unreasonable Covenant Not to Compete

The plaintiff contended that the court should “blue pencil” a contractual noncompete to give the plaintiff the benefit of his bargain, even if the contract was overly broad. The defendant contended that when a party did not negotiate in any way the terms of the covenant not to compete and received minimal consideration in exchange, and the covenants themselves were overly broad, the Court of Chancery has discretion to decline to enforce the covenants entirely.
4 minute read

Delaware Business Court Insider

Chancery Stays Action Pending Resolution of a Motion to Dismiss in a First-Filed Action to Which the Defendant Is Not a Party

Prior to initiating the Delaware Chancery Court action, Eastern Wholesale sued one of Hudson's affiliates—but not Hudson—in North Carolina. Shortly after the filing of the Chancery action, Hudson moved to dismiss or stay. And due to potential overlapping legal and factual issues, Chancellor Kathaleen St. J. McCormick entered a stay.
5 minute read

Delaware Business Court Insider

Chancery Court Exercises Discretion in Setting Bond in a Case Involving Share Transfer Restriction

The Vice Chancellor's decision illustrates the court's discretion and, in this instance, common-sense approach to requiring a bond in the context of provisional relief.
6 minute read

Delaware Business Court Insider

Following 'Purdue Pharma,' Del. Bankruptcy Court Clarifies Standard Applicable to 'Opt-Out' Releases of Claims Against Nondebtors

The court was careful to confine its ruling to precisely the foregoing, and expressed no opinion on plan releases other than nonconsensual ones. In particular, the court was careful to note, "Nothing in what we have said should be construed to call into question consensual third-party releases offered in connection with a bankruptcy reorganization plan."
8 minute read

Delaware Business Court Insider

Repurchase Option in LLC Agreement Tied to Nondisparagement Provision Does Not Violate the Absolute Litigation Privilege

In this recent decision from the Delaware Court of Chancery, Seva Holdings v. Octo Platform Equity Holdings, the court considered whether a membership interest repurchase right under an LLC agreement triggered by breach of a nondisparagement restriction was enforceable, or whether the repurchase scheme violated the absolute litigation privilege.
5 minute read

Delaware Business Court Insider

Court of Chancery's Recent Use of Res Judicata in 'Chai v. Maginn'

This article delves into the Delaware Court of Chancery's recent use of res judicata to remind readers of the doctrine's applications and implications.
8 minute read

Delaware Business Court Insider

Court of Chancery Rejects 'Caremark' Liability for Imperfect Compliance With Legal Obligations

In dismissing for failure to plead demand futility, Vice Chancellor Lori W. Will explained that that allegations of independent directors' knowledge of "imperfect compliance" did not provide a reasonable inference of bad faith "intentional lawbreaking."
5 minute read

Delaware Business Court Insider

Politician Trading: If You Can't Stop Them, Join Them

One company, Autopilot, is taking advantage of Congress members' advantage with a method for Joe Q. Public to trade like a politician.
10 minute read

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