Justia Mergers & Acquisitions Opinion Summaries

This case concerned a contractual dispute among the parties to an indemnification agreement incident to a merger. Plaintiffs asserted claims for indemnification and defendants disputed whether the Indemnification Agreement covered those claims. As to plaintiffs' motion for summary judgment, the court found that the Indemnification Agreement was ambiguous in certain important respects and that there were genuine issues of fact regarding the parties' intent as to the relevant indemnification clauses. Therefore, the court denied plaintiffs' motion for summary judgment, but granted limited relief under Rule 56(d) regarding defendants' laches argument. View "ClubCorp, Inc. v. Pinehurst, LLC and Putterboy Ltd." on Justia Law

This case involved a dispute over earn-out payments related to a merger between Viacom and Harmonix where plaintiff was one of the selling stockholders of Harmonix. Plaintiff sued on behalf of the selling stockholders, alleging that Viacom and Harmonix purposefully renegotiated the distribution contract with EA so as to reduce the earn-out payments payable to the Harmonix stockholders, and thus breached the covenant of good faith and fair dealing implied in the Merger Agreement. The court dismissed plaintiff's claim and held that it would be inequitable for the court to imply a duty on Viacom and Harmonix's part to share with the selling stockholders the benefits of a renegotiated contract addressing EA's right to distribute Harmonix products after the expiration of the earn-out period. View "Winshall v. Viacom Int'l, Inc., et al." on Justia Law

This case involved the interpretation of two provisions in a merger agreement between defendant corporation and a company whose former stockholders were represented by plaintiff. The two provisions at issue dealt with contingent payments due in certain circumstances from defendant to those stockholders. The court found that the language of the merger agreement was unambiguous, and that per its provisions, defendant's obligations under the merger agreement were assumed by the acquiring company, thus avoiding the acceleration of the remaining revenue contingent payments. Therefore, the court denied plaintiff's motion for summary judgment and granted summary judgment in favor of defendant. View "Coughlan v. NXP B.V." on Justia Law

BKR appealed the entry of summary judgment against it in its action for breach of contract against Four Winds, tortious interference with a contractual relationship against Phaunos, deceptive and unfair trade practices and civil conspiracy against FourWinds and Phaunos, and unjust enrichment against Phaunos. The district court held that BKR could not prevail on its contract claim and that all the other claims failed as a result. The court held that the district court erred in granting summary judgment to FourWinds on BKR's contract claim because whether FourWinds pursued an investment opportunity that BKR introduced was a question of fact for a jury. The court also held that the district court's grant of summary judgment to FourWinds on BKR's non-contract theories of relief depended on the district court's erroneous view that BKR's contract claim was precluded as a matter of law. Accordingly, the grant of summary judgment to FourWinds was reversed and the case remanded for further proceedings. View "BKR Global, LLC v. FourWinds Capital Mgmt, et al." on Justia Law

This appeal required the court to determine what effect, if any, a retiree benefits-related provision included in an asset purchase agreement had on the acquiring company's retiree benefits plans governed under the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1000 et seq. The court held that the provision constituted a valid plan amendment. Moreover, the court held that the provision was assumed, not rejected, in bankruptcy. Accordingly, the court reversed and remanded. View "Evans, et al. v. Sterling Chemicals, Inc., et al." on Justia Law

This action arose out of a dispute between two companies involved in the development of pharmaceuticals. Plaintiff was a biodefense company engaged in the development and commercialization of medical countermeasures against biological and chemical weapons and defendant was also a biodefense company that concentrated on the discovery and development of oral antiviral and antibacterial drugs to treat, prevent, and complement vaccines for high-threat biowarfare agents. The court rejected plaintiff's claim that defendant breached a binding license agreement, but found that defendant did breach its obligations to negotiate in good faith and that defendant was liable to plaintiff under the doctrine of promissory estoppel. The court rejected defendant's claim that plaintiff breached its obligation to negotiate in good faith. The court denied plaintiff's claims for specific performance of a license agreement with the terms set forth in the time sheet or, alternatively, for a lump sum award of its expectation damages. The court concluded, however, that plaintiff was entitled to share in any profits relied on from the sale of the drug in question, after an adjustment for the upfront payments it likely would have had to make had the parties negotiated in good faith a license agreement in accordance with the terms of the term sheet. In addition, plaintiff was entitled to recover from defendant a portion of the attorneys' fees and expenses plaintiff incurred in pursuing the action. View "PharmAthene, Inc. v. SIGA Technologies, Inc." on Justia Law

DynaVision (X) sued Brenda Smith, Robert Thomas, and Bryan Ownbey, (Y) alleging that they breached a fiduciary duty to tell X that Shelby Peeples (Z) had financed the purchase of its interest and moreover, that Y's failure to disclose Z's involvement fraudulently induced X to sell its interest to Y. X also brought suit against Z, the case before the court, alleging that Z violated federal securities law, state securities law, and state common law by denying involvement in the transaction and causing X to sell its interest to Y. X lost both cases on summary judgment because Y's alleged misrepresentation about Z's involvement in the buy-out did not cause X to sell its interest. Rather, X sold because it was in X's economic self-interest to do so. X needed Y's skills; had X purchased Y's interest, it would have had no one to run the carpet factory or to market its product. X therefore had no economically viable option but to sell. After assessing the merits of X's claims, the court affirmed the judgment granting summary judgment. View "Ledford, et al. v. Peeples, Jr." on Justia Law

This action arose out of the sale of Giant Cement Holding, Inc. (Giant) by defendant Cementos Portland Valderrivas (CPV) to defendant Corporacion Uniland S.A. Sagarra Inversiones, S.L. (Sagarra) challenged the transaction on the basis of CPV's self-dealing because of its position as the majority shareholder on both sides of the transaction. Sagarra purported to bring this action individually and derivatively on behalf of nominal defendant Uniland Acquisition Corp. (Uniland Delaware). The court held that to the extent the Complaint asserted a multiple derivative action on behalf of Uniland Delaware, it must be dismissed because Sagarra did not have standing to raise those claims based on the court's review of Spanish law. The court held that for the same reasons, Counts I and II, which assert multiple derivative claims on behalf of Uniland Delaware, were dismissed. The court's determination with respect to Sagarra's lack of standing as to Counts I and II was equally applicable to Count III. The court finally held that because Count IV raised fiduciary duty claims under Spanish law, the better course of action was for the court to exercise its discretion and dismiss Count IV. Therefore, defendants' motion to dismiss the Complaint was granted and an implementing order would be entered. View "Sagarra Inversiones, S.L. v. Cementos Portland Valderrivas, S.A., et al." on Justia Law

Intercontinental Exchange, Inc. and the Board of Trade of the City of New York, Inc. (collectively, defendants), merged in 2007. Plaintiff was a member of the Board of Trade before the merger and the merger agreement required that if a member, including plaintiff, wished to continue in the newly merged enterprise, the member had to submit an Election Form specifying that preference by a stated deadline. Plaintiff did not receive the Election Form until after the deadline had passed and thereafter, defendants learned that many members, including plaintiff, had failed to submit the Election Form. Defendants waived the deadline and then, in an ad hoc manner and without notice to any member, imposed a new deadline. Defendants subsequently decided that plaintiff's Form was untimely and, of all the post-deadline-filled Forms, plaintiff's Form was the only one that defendants deemed untimely and refused to honor. Thereafter, plaintiff filed an action alleging breach of contract and the Court of Chancery ruled in favor of defendants. The court concluded, however, that defendants waived the initial deadline and also failed to retract that waiver by providing reasonable notice of their new deadline. Because the retraction of the waiver was invalid as a matter of law, plaintiff's Election Form was timely. Accordingly, the judgment of the Court of Chancery was reversed and the matter remanded for further proceedings. View "Amirsaleh v. Bd of Trade of the City of New York Inc., et al." on Justia Law

This case arose out of a sale-leaseback transaction that occurred in 2001. On July 10, 2011, the seller-lessees' parent company announced plans for a proposed transaction whereby it would seek a new credit facility and undergo an internal reorganization. As part of a subsequent reorganization, substantially all of its profitable power generating facilities would be transferred from existing subsidiaries to new "bankruptcy remote" subsidiaries, except for two financially weakened power plants. On July, 22, 2011, plaintiffs brought this action seeking to temporarily restrain the closing of the proposed transaction on the grounds that it violated the successor obligor provisions of the guaranties and would constitute a fraudulent transfer. The court found it more appropriate to analyze plaintiffs' motion for a temporary restraining order under the heightened standard for a preliminary injunction. Having considered the record, the court held that plaintiffs have failed to show either a probability of success on the merits of their breach of contract and fraudulent transfer claims or the existence of imminent irreparable harm if the transaction was not enjoined. Therefore, the court denied plaintiffs' application for injunctive relief. View "Roseton Ol, LLC, et al. v. Dynegy Holdings Inc." on Justia Law