In Chester County Employees’ Retirement Fund v. KCG Holdings, Inc. et al the Delaware Court of Chancery considered the interplay between the Corwin and Revlon doctrines. In July 2017, Virtu Financial, Inc. (“Virtu”) acquired KCG Holdings, Inc. (“KCG”) for $20 per share. A former KCG stockholder alleged KCG’s directors failed... Read More
The FTC published its views on divestiture packages used to obtain clearance under the HSR Act. According to the FTC: “Before putting pen to paper, parties should discuss with Bureau staff what assets, rights, and personnel should be included in the divestiture package. For instance, assets outside the market of... Read More
In July 2015, Toshiba Corporation (“Toshiba”) revealed that it had overstated its profits by billions of dollars. As a result, Toshiba implemented a plan to sell a subsidiary to Canon Inc. (“Canon”). In March 2016, Toshiba sold to Canon its subsidiary Toshiba Medical Systems Corporation (“TMSC”), and Canon paid Toshiba... Read More
In Shareholder Representative Services LLC v. RSI Holdco, LLC et al, the Delaware Court of Chancery considered when a buyer can use the acquired company’s privileged pre-merger attorney-client communications in post-closing litigation against the sellers. The question arises because at closing all computer systems and email servers are acquired by... Read More
On May 15, 2019, President Donald Trump issued an Executive Order on Securing the Information and Communications Technology and Services Supply Chain. The order provides in part (emphasis added): The following actions are prohibited: any acquisition, importation, transfer, installation, dealing in, or use of any information and communications technology or... Read More
The SEC has proposed rule amendments that revise required financial disclosure upon the acquisition and disposition of businesses in M&A transactions. The proposed changes would, among other things: update the significance tests under these rules by revising the investment test and the income test, and conforming the significance threshold and... Read More
In Batty v. UCAR International Inc. et al the Delaware Court of Chancery considered the terms of a severance agreement. The agreement, which was entered into in 2000, set the compensation that plaintiff Batty, who was employed by certain of the defendants for 34 years, would receive from the defendants... Read More
In Olenik V. Lodzinski et al, the Delaware Supreme Court reversed the Court of Chancery finding the conditions required for business judgment review of a transaction with a controlling shareholder had not been conducted in accordance with Kahn v. M&F Worldwide Corp. from the outset and therefore the entire fairness... Read More
The Financial Accounting Standards Board issued a proposed Accounting Standards Update on the recognition and measurement of deferred revenue in business combinations. The proposed ASU clarifies when acquiring organizations should recognize a contract liability in a business combination. In the proposal, an organization should recognize deferred revenue from acquiring another... Read More
In Re Tangoe, Inc. Stockholders Litigation was one of those situations where everything that could go wrong did. According to the Plaintiff, the Tangoe directors breached their fiduciary duties to Tangoe stockholders by steering the Company into an ill-advised take-private acquisition with a negative premium by Marlin Equity and recommended... Read More