Francis Pileggi

Subscribe to all posts by Francis Pileggi

Doctrine of Laches Bars Quasi-Appraisal Remedy

In Houseman v. Sagerman, C.A. No. 8897-VCG (Del. Ch. Nov. 19, 2015), the Delaware Court of Chancery described the form of remedy known as a quasi-appraisal. The Court of Chancery explained that quasi-appraisal is not itself a cause of action, but is instead a remedy that, where appropriate, awards stockholders damages based on the going-concern value … Continue Reading

Top Three Delaware Corporate Decisions for 2015

For the last ten years or so on these pages, I have selected annually the top Delaware corporate law decisions. This is a somewhat subjective exercise in light of the estimated 200 or more notable corporate and commercial decisions issued each year by Delaware’s Supreme Court and Court of Chancery. This year the top three … Continue Reading

Chancery Determines that BJR Applies Instead of Revlon Standard

The Court of Chancery in the recent decision styled In re Zale Corporation Stockholders Litigation, C.A. No. 9388-VCP (Del. Ch. Oct. 29, 2015), in a rare grant of a motion for reargument pursuant to Rule 59, dismissed a financial advisor after the court had previously denied the same motion to dismiss the financial advisor. The current ruling is … Continue Reading

Chancery Enforces Covenant Not To Compete

The Chancery opinion in Revolution Retail Systems, LLC v. Sentinel Technologies, Inc., C.A. No. 10605-VCP (Del. Ch. Oct. 30, 2015), discusses many issues in connection with the breach of contract for the sale of a business. The sale involved an ongoing collaborative relationship. Although Texas law applied to many aspects of the case, the court cited … Continue Reading

Delaware Supreme Court to Hear Argument on When Stockholders Can Demand Records of Aborted Merger

Tomorrow, the Delaware Supreme Court will hear oral argument on an appeal of the decision of the Court of Chancery which denied a request by a stockholder for books and records, pursuant to DGCL Section 220, related to the aborted merger of AbbVie, Inc., a pharmaceutical spin-off of Abbott Labs, and Shire, a pharmaceutical company based in Ireland. … Continue Reading

Chancery Dismisses Challenge to Board Decision to Settle Claims

In Shaev v. Adkerson, C.A. No. 10436-VCN (Del. Ch. Oct. 5, 2015), the Delaware Court of Chancery dismissed claims for breach of fiduciary duty including the disclosure obligations of the board which granted stock units valued at approximately $35 million in connection with its decision to settle potential claims that could have been brought for … Continue Reading

Board-Centered Approach to Activist Investors

Frank Reynolds of Thomson Reuters has written an article that provides a detailed synopsis of the presentation last week by Professor Jeffrey Gordon of Columbia Law School in which the good professor discusses the triumph of Delaware’s board-centered model in connection with activist investors. The speech was presented as the 31st Annual Francis G. Pileggi … Continue Reading

Delaware Supreme Court Rules on Director Independence

The Delaware Supreme Court issued two decisions a few days ago, in the Sanchez and Corwin cases. The Sanchez case addressed the topic of director independence and when pre-suit demand is excused in the context of long-term personal relationships. Prof. Usha Rodrigues provides scholarly insights on the Sanchez case that she graciously shared with us.  By way … Continue Reading

31st Annual F.G. Pileggi Distinguished Lecture in Law

The Delaware Journal of Corporate Law of Widener University Delaware Law School presents the 31st Annual Francis G. Pileggi Distinguished Lecture in Law Title of Lecture: “Shareholder Activism: the Triumph of Delaware’s Board-Centered Model and the New Role for the Board of Directors” Presented by: Professor Jeffrey N. Gordon Richard Paul Richman Professor of Law, … Continue Reading

Delaware Supreme Court Addresses Standard of Review for Board’s Consideration of Stockholder Demand

The Delaware Supreme Court’s opinion in Espinoza v. Dimon, et al., No. 425, 2015 (Del. Sept. 15, 2015), addressed a certified question of corporate law from the United States Court of Appeals for the Second Circuit. Although the Delaware Supreme Court refused to provide a complete answer to the precise question presented, based on factual issues that … Continue Reading

Chancery To Be Less Likely to Approve Fees in Disclosure Only Cases

In re Riverbed Technology, Inc., Stockholders Litigation, Cons. C.A. No. 10484-VCG (Del. Ch. Sept. 17, 2015). This Delaware Court of Chancery opinion is noteworthy because it provides notice to corporate litigators in Delaware that any future requests for court approval of a class action settlement, or for attorneys’ fees in connection with a class action … Continue Reading

Recent Developments at Intersection of D & O Coverage and Delaware Corporate Litigation

Courtesy of Frank Reynolds of Thomson Reuters, we have highlights of the American Conference Institute’s two-day D&O Liability Insurance conference, that addresses recent developments in corporate litigation, including Delaware court decisions, that have an impact on the insurance industry. An excerpt from Frank’s article, hyperlinked above, should be of interest: Corporate and insurance law specialists have long paid close … Continue Reading

Court Strikes Impertinent Portion of Complaint

In Carlyle Investment L.L.C. v. Moonmouth Company S.A., C.A. No. 7841-VCP (Del. Ch. Sept. 10, 2015), the Delaware Court of Chancery grants the rare motion to strike a part of the complaint that the court considers scandalous or impertinent pursuant to Court of Chancery Rule 12(f). See Slip op. at 45-46. In addition, the court addresses other topics of interest … Continue Reading

Post-Trial Intervention Denied

The Court of Chancery rejected a request for post-trial intervention under Court of Chancery Rule 24, in the matter styled Shawe v. Elting, et al., C.A. No. 9686-CB (Del. Ch. Sept. 2, 2105). Rule 24 is a useful rule to be familiar with for corporate and commercial litigation in general. This is the third decision in this case … Continue Reading

Rare Rejection of Advancement Claim

In the recent Chancery decision of Lieberman v. Electrolytic Ozone, Inc., C.A. No. 10152-VCN (Del. Ch. Aug. 31, 2015), the court rejected claims for advancement by former officers and directors who sought to have their former company pay for the attorneys’ fees they incurred in defending a suit brought against them by the company for whom … Continue Reading

Chancery Determines Proper Board Members in Section 225 Action

The Delaware Court of Chancery in Kerbawy v. McDonnell, C.A. No. 10769-VCP (Del. Ch. Aug. 18, 2015), addresses whether written consents of stockholders were effective in replacing the board members of the company involved.  The case features the interplay between DGCL § 225 and § 228 in this corporate litigation over control of the company. DGCL … Continue Reading

Short Observation on Long Delaware Chancery Decisions

Based on the more than ten years that I have been highlighting corporate and commercial decisions on these pages, primarily from Delaware’s Supreme Court and Court of Chancery, I am aware that the main reason busy readers visit these pages is not for metaphysical ruminations. This short observation has at least some practicality. Over the last three weeks or … Continue Reading

Chancery Appoints Custodian to Break Deadlock of Profitable Corporation

In re: Shawe & Elting LLC, C.A. No. 9661-CB (Del. Ch. Aug. 13, 2015). There are many important principles of Delaware corporate law addressed in this 104-page post-trial opinion, but for the benefit of busy readers, I will highlight those aspects of this decision that have the widest practical applicability to those involved in corporate and … Continue Reading