Professor Stephen Bainbridge, a nationally recognized corporate law expert whose scholarship is often cited in Delaware decisions, opines on Delaware corporate law aspects of the apparent negotiation by Facebook’s CEO of the recent purchase of Instagram, over a weekend, with the head of Instagram directly, and without the army of lawyers and advisers–and without the involvement of the board, that are usually part of the process of an acquisition valued at $1 billion.

In particular, the good professor describes the similarities of the deal negotiated over the weekend by two CEOs–without the apparent involvement of their respective boards, and the iconic Delaware Supreme Court decision of Smith v. Van Gorkom, 488 A.2d 858 (Del. 1985). A link is provided to Professor Bainbridge’s article on the case, in which Delaware’s High Court exposed the directors of Trans Union to personal liability for their breach of fiduciary duty because the directors failed to fully inform themselves of all reasonably available information before deciding to recommend a merger, and thus did not enjoy the protection of the business judgment rule.