Marc Boiron was quoted in a May 19, 2017 article in Law360 about two recent Delaware corporate law rulings that some say have already chased a number of shareholder merger claims out of the First State’s courts.
The two rulings —Corwin, which found that an informed shareholder vote to approve a deal “cleansed” it of many fiduciary duty claims, and Trulia, which was widely seen as having ended the practice of disclosure-only merger litigation settlements — came in quick succession, respectively in October 2015 and January 2016.
Since then, the number of big-ticket mergers facing a challenge in the Delaware Chancery Court has fallen by nearly half, from 61 percent in 2015 to 32 percent the following year, according to an academic paper by corporate law professors Matthew D. Cain, Jill E. Fisch, Steven Davidoff Solomon and Randall S. Thomas expected to be published by Vanderbilt University Law School next year.
Meanwhile, the research shows a substantial uptick in deals being challenged in federal courts — from 20 percent to 37 percent over the same time period.
“If you look at Trulia and Corwin, you see a massive dip in claims in the Chancery Court,” said Marc Boiron of Rutan & Tucker LLP, who usually works with boards on transaction matters. “Corwin killed a massive amount of litigation in Delaware. Unless it’s pretty clear there are significant disclosure violations, you aren’t going to bring a claim in Delaware.”