Controlling Stockholder Avoids Liability Despite Overreach Into Special Committee Brokered-Settlement
Triggering Delaware's entire fairness review in stockholder litigation was once considered outcome determinate, but that view has waned. Numerous…
November 08, 2023 at 09:00 AM
6 minute read
ContributorsTriggering Delaware's entire fairness review in stockholder litigation was once considered outcome determinate, but that view has waned. Numerous decisions have shown that defendants can overcome the unified fair process and fair price components of entire fairness review and avoid sizeable judgments. Despite a finding of liability against a controlling stockholder arising out his overreach into a committee's process, the defense in In re Straight Path Communications Consolidated Stockholder Litigation, 2023 WL 6399095 (Del. Ch. Oct. 3, 2023) followed a well-worn path to success: proving the transaction's fair price.
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