Edited by Sean Griffith, Jessica Erickson, David H. Webber and Verity Winship
Chapter 13: Changing attitudes: the stark results of thirty years of evolution in Delaware M & A litigation
This chapter compares the way in which the Delaware Supreme Court applied enhanced scrutiny in M & A settings during the decade that followed the creation of the intermediate standard of review with the Delaware Supreme Court’s current approach to similar issues. The chapter cautions that the attitudes displayed in the early landmark decisions, and the results they reached, no longer hold. Current Delaware law supports the use of a single bidder sale process, prioritizes the contract rights of acquirers over the rights of sellside stockholders, and rules out targeted preliminary injunctions. In place of vigorous judicial enforcement, current Delaware law defers to the stockholders to protect themselves by voting down deals that adversely affect their interests. The chapter posits that while multiple factors contributed to this shift, the two most salient are the rise of institutional investors and the generalized failure of stockholder-led M & A litigation.
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