Archives: Merger Litigation

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Plaintiffs Argue District Court Lacked Authority to Set Aside Their Mootness Fee Settlement

As I have detailed in prior posts, in the latest variant in the merger objection litigation game, the plaintiffs agree to dismiss their lawsuit after the defendant companies make additional disclosures and agree to pay the plaintiffs’ counsel a “mootness fee.” The absence of any court involvement in the case resolution makes this an attractive … Continue Reading

Plaintiffs’ Lawyers, Merger Objection Litigation, and Mootness Fees

In a prior post, I noted recent academic research detailing the rise of mootness fee dismissals in federal court merger objection litigation. In these merger-related lawsuits, the plaintiffs agree to dismiss their suit based on the defendants’ agreement to make changes to the merger documents – thus, making the merger suit moot – and to … Continue Reading

Percentage of 2018 Deals Drawing Merger Objection Suits Held Steady

One of the most significant corporate litigation phenomena over recent years has been the rise of merger objection litigation, as result of which nearly every public company merger objection transaction has drawn at least one lawsuit. According to the latest study of merger litigation from Cornerstone Research, this phenomenon continued in 2018, with the same … Continue Reading

Delaware Federal Court Rejects Merger Objection Plaintiffs’ Mootness Fee Request

As discussed in prior posts, after the Delaware courts evinced their distaste for the type of disclosure-only settlements that had until then typically resolved merger objection lawsuits, the plaintiffs’ lawyers changed their game. They began filing their merger objection lawsuits in federal court rather than in state court, and then rather than settling the cases, … Continue Reading

Is This the Beginning of the End of the Merger Objection Lawsuit Mootness Fee Racket?

In a recent post, I detailed the latest variant in the merger objection litigation game, in which the plaintiffs’ agree to dismiss their lawsuit in exchange for the defendants’ agreement to make additional disclosures and pay the plaintiffs’ counsel a mootness fee. The absence of any court involvement in this process makes this an appealing … Continue Reading

Mootness Fees: The Latest in the Merger Objection Litigation Phenomenon

One of the most significant phenomena in the world of corporate and securities litigation has been the rise of merger objection litigation. As has been well-documented, merger objection litigation reached the point in recent years that virtually every public company merger transaction drew at least one lawsuit. The circumstances surrounding merger objection litigation began to … Continue Reading

Cornerstone Research: After Years of Increases, Number of Delaware Appraisal Actions Decline

Between 2010 and 2016, the number of shareholder appraisal actions filed in Delaware courts increased every year, but in 2017 and again in 2018, the number of appraisal actions declined, according to a recent report from Cornerstone Research. The decline arguably is a result of recent Delaware Supreme Court decisions in which the court reversed … Continue Reading

Guest Post: Merger Objection Lawsuits Getting Tougher for Plaintiffs’ Attorneys

As I have previously noted on this blog, merger objection litigation imposes significant costs on the defendant companies and their insurers. In the following guest post, Patrick Gallagher of the integrated communications and investor relations firm Dix & Eaton takes a look at recent developments in the merger objection litigation arena. I would like to … Continue Reading

Percentage of M&A Deals Attracting Litigation Continued to Decline in 2017

The percentage of M&A transactions valued over $100 million attracting at least one merger objection lawsuit continued to decline in 2017, according to a recent Cornerstone Research study. The July 18, 2018 study, entitled “Shareholder Litigation Involving Acquisitions of Public Companies: Review of 2017 M&A Litigation” (here), also reports that the average number of lawsuits … Continue Reading

Florida Court Adopts Delaware’s Strict Standard for Review of Disclosure-Only Settlements

In a series of rulings that culminated in the January 2016 decision in the Trulia case, the Delaware courts evinced their hostility to the disclosure-only settlements that so often characterize the resolution of merger objection lawsuits. Since that time claimants have been filing the merger objection suits in courts outside Delaware. The question has been … Continue Reading

The Growing Costs of Merger Objection Litigation

As most readers are aware, litigation involving objection to mergers and acquisitions transactions has been proliferating in recent years, to the point that virtually every deal draws at least one lawsuit. While many of these actions are nuisance lawsuits, they are not without their costs. Indeed, according to one recent study, the costs to defend … Continue Reading

Is Shareholder Litigation in Delaware in Trouble?

In prior posts (for example here), I noted that a series of Delaware court decisions culminating in the Court of Chancery’s January 2016 opinion in the Trulia case signaled the state’s courts’ hostility to disclosure-only settlements in merger objection lawsuit, which in turn has encouraged merger objectors to file their lawsuits in other jurisdictions. The … Continue Reading

New York Court Rejects “Utterly Useless” Disclosure-Only Merger Objection Suit Settlement

In a series of rulings culminating in the January 2016 decision in Trulia (about which refer here), Delaware’s courts have evinced their hostility to the kind of disclosure-only settlement in which merger objection suits are frequently resolved. Since that time, plaintiffs’ lawyers increasingly have filed merger-objection lawsuits outside of Delaware, either in federal court or … Continue Reading

Is Deal Litigation in Delaware Done?

As documented on this site (for example, here and here) and elsewhere, deal litigation has been shifting from Delaware Chancery Court to courts in other states and to federal courts. This shift is largely the result of two Delaware court decisions, the Delaware Supreme Court’s 2015 decision in Corwin v. KKR Financial Holdings LLC  (here) … Continue Reading

Are New York Courts Keeping the World Safe for Nuisance Value Merger Objection Lawsuits?

In a series of decision culminating in Chancellor Bouchard’s January 2016 ruling in the Trulia case (about which refer here), Delaware’s courts have shown their hostility to disclosure-only settlements in merger objection lawsuits. These Delaware developments led some observers to speculate that we might have seen the end of the litigation trend in which nearly … Continue Reading

A “Tidal Wave of Change” in Merger Objection Litigation

In response to concerns that virtually every merger transaction was attracting at least one lawsuit, Delaware’s legislature and judiciary acted to try to cut down on the merger objection litigation in the state’s courts. In 2015, Delaware’s legislature adopted a provision expressly allowing corporations organized under the state’s law to adopt bylaw provisions designating Delaware’s … Continue Reading

Latest Twist in the Merger Objection Lawsuit Saga: New York Appellate Court Approves Disclosure-Only Settlement

After the Delaware courts in a series of decisions culminating in the January 2016 ruling in the Trulia case showed their hostility to disclosure-only settlements of merger objection lawsuits, commentators asked whether this development might mean the end of the merger objection lawsuit curse. Since that Delaware court’s decision in the Trulia case, plaintiffs’ lawyers … Continue Reading
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