Justia Mergers & Acquisitions Opinion Summaries

In 2010, BLGH entered into an agreement with enXco to sell BLGH's renewable energy business, Beacon, to enXco. The Unit Purchase Agreement that governed the sale of Beacon (UPA) called for a purchase price of $12 million, plus a "bonus payment" to BLGH if certain conditions were met. The sale of Beacon took place and BLGH was paid $12 million. A dispute arose, however, over whether BLGH was entitled to the additional bonus payment. enXco claimed that no bonus payment was legally due. BLGH responded by filing a Superior Court action against enXco for breach of contract. The Superior Court granted summary judgment to enXco, holding that no bonus payment was owed to BLGH under the UPA. The court reversed and held that the Superior Court erred as a matter of law in granting summary judgment to enXco where the transaction "outlined" in the letter of intent met the requirements of Section 1.7 of the UPA, triggering BLGH's right to a bonus payment, and nothing more was required by the UPA for BLGH to become legally entitled to the bonus payment. View "BLGH Holdings LLC v. Enxco LFG Holding, LLC" on Justia Law

This action was before the court on a motion to preliminarily enjoin an all-cash negotiated tender offer for all of the shares of a biopharmaceutical company. Plaintiffs, shareholders of the target company, claimed that the offer was for an unfair price and was the result of an unfair and flawed sales process. Plaintiffs also claimed that the solicitation materials recommending the tender offer contained materially false and misleading information. As a result, plaintiffs sought to have the tender offer enjoined before its consummation. The court concluded that plaintiffs have failed to show a reasonable likelihood that they would succeed in proving that the challenged transaction was unfair or that the directors breached their fiduciary duties of care or loyalty, including their disclosure obligations, in approving the transaction. Therefore, the court denied plaintiffs' motion to preliminarily enjoin the tender offer. View "In re Micromet, Inc. Shareholders Litigation" on Justia Law

This case involved Bancorp's agreement to sell BankAtlantic to BB&T. Plaintiffs, institutional trustees, sued to enforce debt covenants that prohibited Bancorp from selling "all or substantially all" of its assets unless the acquirer assumed the debt. The evidence at trial established that Bancorp was selling substantially all of its assets, and BB&T had not agreed to assume the debt. The ensuing event of default would result in the debt accelerating. Bancorp could not pay the accelerated debt. Because this eventuality would inflict irreparable harm on plaintiffs, the court entered contemporaneously an order permanently enjoining Bancorp from consummating the sale. View "In re BankAtlantic Bancorp, Inc. Litigation" on Justia Law

This matter involved a stockholders' suit over the proposed takeover of Delphi by TMH. Based upon the record, the court found that plaintiffs have demonstrated a likelihood of success on the merits at least with respect to the allegations against defendant. However, because the deal represented a large premium over market price, because damages were available as a remedy, and because no other potential purchaser had come forth or seemed likely to come forth to match, let alone best, the TMH offer, the court could not find that the balance of the equities favored an injunction over letting the stockholders exercise their franchise, and allowing plaintiffs to pursue damages. Therefore, the court denied plaintiff's request for a preliminary injunction. View "In re Delphi Financial Group Shareholder Litigation" on Justia Law

Series C-1 preferred shareholders, claiming that the forced conversion of their shares was unlawful, sued Omneon in the Superior Court for breach of contract. Those shareholders, as plaintiffs, claimed that, because the conversion of their preferred shares was integral to Harmonic's acquisition of Omneon, the conversion was part of a "Liquidation Event" under Omneon's certificate of incorporation, that entitled the shareholders to the liquidation "preference" payable for their shares. The Superior Court granted summary judgment in favor of Omneon, holding that under the plain language of Omneon's certificate of incorporation, only one series of preferred stock - the Series A-2.2 - was legally entitled to a liquidation preference payout. The shareholders were not entitled to a liquidation payout because the Series C-1 preferred shares had been validly converted into common stock before the Omneon-Orinda merger took place. The court agreed and concluded that the conversion was not part of a "Liquidation Event" as defined by Omneon's charter. Therefore, the court affirmed the judgment. View "Berkeley VI C.V., et al. v. Omneon, Inc." on Justia Law

After a merger between Nestle and Ralston Purina, plaintiff, a book-entry shareholder, filed this putative class action in Missouri state court on behalf of himself and all other Ralston Purina book-entry shareholders at the time of the execution of the merger agreement. Plaintiff claimed that Nestle was required to pay the class on a certain date, Nestle's payment was delinquent, and therefore the class was entitled to interest on the payment. Nestle subsequently appealed the district court's order remanding the putative class action to the state courts of Missouri. Because at the time the case was removed it did not meet the amount in controversy requirements for federal subject matter jurisdiction under the Class Action Fairness Act of 2005 (CAFA), 28 U.S.C. 1332(d), 1453, 1711-15, the court affirmed the order of the district court. View "Rolwing v. Holdings, Inc." on Justia Law

Petitioners argued that defendants - who were the then-parent company and directors of Aristotle Corporation - breached their fiduciary duties by not disclosing all material facts in connection with a short-form merger under 8 Del. C. 253. At issue was whether petitioners, who already had the right to seek appraisal in connection with a section 253 merger, could add an additional claim alleging that the directors breached their fiduciary duty to disclose the material facts necessary for the stockholders to determine whether to seek appraisal when the only purpose of pressing the disclosure claim was to give petitioners the redundant right of a "quasi" version for something that they already possessed? Because petitioners have not alleged that they have suffered any cognizable injury that gave rise to standing, and because they were therefore asking in these unique circumstances for an improper advisory decision, the court granted defendants' motion to dismiss. View "In Re: Appraisal Of The Aristotle Corp." on Justia Law

This derivative suit was brought against the Grupo Mexico subsidiary that owned Minera, the Grupo Mexico-affiliated directors of Southern Peru, and the members of the Special Committee, alleging that the Merger at issue was entirely unfair to Southern Peru and its minority stockholders. The court concluded that the transaction was unfair and remedied the unfairness by ordering the controller to return to the NYSE-listed company a number of shares necessary to remedy the harm. The court applied a conservative metric because of plaintiff's delay, which occasioned some evidentiary uncertainties and which subjected the controller to lengthy market risk. View "In re Southern Peru Copper Corp. Shareholder Derivative Litigation" on Justia Law

Plaintiffs filed this lawsuit on behalf of a class of stockholders of Occam. Defendants moved for sanctions against all plaintiffs other than Derek Sheeler for trading on the basis of confidential information obtained in this litigation. With respect to Michael Steinhardt and the funds, the motion was granted. Consistent with prior rulings by this court when confronted with representative plaintiffs who have traded while serving in a fiduciary capacity, Steinhardt and the funds were dismissed from the case with prejudice, barred from receiving any recovery from the litigation, required to self-report to the SEC, directed to disclose their improper trading in any future application to serve as lead plaintiff, and ordered to disgorge profits. With respect to Herbert Chen, the motion was denied. View "Steinhardt, et al. v. Howard-Anderson, et al." on Justia Law

Plaintiff challenged two transactions in this purported class action brought on behalf of the former public holders of LP units of EPE. On behalf of the first of the two purported classes, plaintiff challenged EPE's sale of Teppco GP to Enterprise Products (the 2009 Sale). On behalf of the second purported class, plaintiff challenged the merger of EPE into a wholly-owned subsidiary of Enterprise Products (the Merger). Defendants moved to dismiss all claims, or in the alternative, to stay this action pending the resolution of a related case. The court held that plaintiff had standing to bring the claims asserted in Counts I, III, and V on behalf of the public holders of EPE LP units who continuously held their units from the date of the 2009 Sale through the effective date of the Merger. However, all six counts were dismissed for failure to state a claim. Accordingly, defendants' motion to dismiss was granted. View "Gerber v. Enterprise Products Holdings, LLC, et al." on Justia Law