News & Analysis as of

Acquisition Agreements Breach of Contract

Mayer Brown

Delaware Law Alert: Chancery Court Applies Conditional Probability to Calculate Damages in Earnout Dispute

Mayer Brown on

A recent Delaware Chancery Court opinion offers a significant example of how courts may apply complex probability analysis to determine the amount of damages in an earnout dispute. The case arose from Alexion Pharmaceuticals,...more

Troutman Pepper Locke

Restrictive Covenants Unenforceable Where Consideration Forfeited

Troutman Pepper Locke on

In North American Fire Ultimate Holdings, LP v. Alan Doorly, the Delaware Court of Chancery held that the restrictive covenants included in an incentive unit grant agreement were unenforceable when the units received by the...more

Jones Day

Earnouts in M&A Transactions: Recent Decisions From Delaware

Jones Day on

In 2024, Delaware courts issued multiple instructive decisions on earnout provisions in life sciences M&A transactions. ...more

Mayer Brown

Delaware Law Alert: Chancery Court Clarifies Delaware’s Position on Sandbagging and the Use of a Transaction Multiple to Calculate...

Mayer Brown on

AT A GLANCE - The Delaware Chancery Court has issued a notable opinion that confirms Delaware’s position as a pro-sandbagging jurisdiction and clarifies when damages may be computed using a transaction multiple. We...more

Mayer Brown

Delaware Law Alert: Efforts Standards in Life-Sciences Earnout Provisions

Mayer Brown on

In two significant recent opinions, the Delaware Chancery Court ruled against the buyers of life sciences companies, holding that they failed to apply commercially reasonable efforts to achieve earnout milestones. In Fortis...more

Stikeman Elliott LLP

Choose Your Words Carefully: Three Recent Earnout Cases Under Delaware Law

Stikeman Elliott LLP on

When the prospects of an acquired business are uncertain, an earnout can bridge the valuation gap between buyer and seller and help get the deal done. Taking this route is not without risk, however, particularly where...more

Stikeman Elliott LLP

Limitations on Good Faith Damages: No Presumption of Loss for Breach of Honest Performance

Stikeman Elliott LLP on

In Bhatnagar v. Cresco Labs Inc., 2023 ONCA 401, the Ontario Court of Appeal elaborated on the Supreme Court’s decision in C.M. Callow Inc. v. Zollinger, 2020 SCC 45 (“Callow”) and clarified that a breach of the contractual...more

A&O Shearman

Delaware Court Of Chancery Dismisses Breach Of Contract Claims Against Buyer, Finding Seller Retained Post-Closing Liability...

A&O Shearman on

On April 3, 2023, Vice Chancellor Nathan A. Cook of the Delaware Chancery Court dismissed the breach of contract claims by one pharmaceutical company (the “Seller”) against another (the “Buyer”) in connection with the Buyer’s...more

Wyrick Robbins Yates & Ponton LLP

Yonder Window Breaks: Earnout Covenants in Acquisitions

Earnouts, which provide sellers payouts if certain post-closing milestones are reached, have become increasingly popular in recent M&A transactions given today’s uncertain regulatory and financial climate.  Inflation, supply...more

Herbert Smith Freehills Kramer

Sandbagging: A Primer

In the 19th century, “ruffians roamed the streets” and robbed “unsuspecting victims” using a tactic knowing as “sandbagging”: They wielded “ostensibly harmless socks” that were in fact “filled with sand and used as weapons.” ...more

J.S. Held

[Webinar] Post-Merger & Acquisition Dispute Resolution - December 7th, 12:30 pm - 1:30 pm EST

J.S. Held on

Global Investigations expert Frank Lazzara, CPA, CFF, ABV, CFE, and Economic Damages & Valuations expert David Golbahar, CPA, CFF, CGMA, will present a one-hour* course, which will cover: - An overview of purchase price...more

Gray Reed

Delaware Court Provides Clarity Regarding Anti-Bootstrapping Rule

Gray Reed on

On January 27, 2022, in Levy Family Investors, LLC v. Oars + Alps LLC the Delaware Court of Chancery (the “Court”) released a memorandum opinion providing clarity with regard to Delaware’s infamous “Anti-Bootstrapping Rule”...more

Gray Reed

Delaware: A Confirmed Pro-Sandbagging Jurisdiction

Gray Reed on

In an opinion of significance to M&A Practitioners, the Delaware Court of Chancery recently made it clear that Delaware law allows a buyer in an acquisition to “sandbag” a seller if the acquisition agreement allows for...more

A&O Shearman

Delaware Court Of Chancery Grants Motion To Stay Pending Appeal Of Specific Performance Judgment Requiring Completion Of...

A&O Shearman on

On March 31, 2022, Vice Chancellor Joseph R. Slights III of the Delaware Court of Chancery ­granted the motion of CorePower Yoga, LLC and CorePower Yoga Franchising, LLC (together, “defendant”) to stay the Court’s judgment in...more

Jones Day

COVID-19 and Merger Litigation: Takeaways After Two Years

Jones Day on

Before the pandemic, it was generally accepted that establishing an MAE was very difficult—indeed, only one case in Delaware, 2018's Akorn v. Fresenius Kabi, had ever found that an MAE occurred. Following the pandemic, this...more

A&O Shearman

Delaware Court Of Chancery Holds COVID-19 Pandemic Did Not Excuse Purchaser’s Obligation To Complete Acquisition Of Its...

A&O Shearman on

On March 1, 2022, Vice Chancellor Joseph R. Slights of the Delaware Court of Chancery ruled in favor of plaintiff Level 4 Yoga, LLC in a breach of contract action against CorePower Yoga, LLC and CorePower Yoga Franchising,...more

Stikeman Elliott LLP

“Commercially Reasonable Best Efforts”: B.C. Court Provides Guidance in Context of Purchase and Sale Contract

Stikeman Elliott LLP on

In Sutter Hill Management Corporation v. Mpire Capital Corporation (Sutter), the British Columbia Court of Appeal found that the acquiror of an Abbotsford, B.C. care home had breached the purchase and sale agreement by...more

Morris James LLP

Chancery Rules That The Standard Of Proof For Contempt Motions Is The Preponderance Of The Evidence, Not Clear And Convincing...

Morris James LLP on

inTEAM Associates, LLC v. Heartland Payment Systems, LLC, C.A. No. 11523-VCF (Del. Ch. Oct. 29, 2021) - Court of Chancery Rule 70(b) empowers the Court to hold a party in contempt for, among other things, failing to obey...more

Farrell Fritz, P.C.

Course Correction: Why “Ordinary Course” Covenants in Acquisition Agreements Should be Drafted Carefully

Farrell Fritz, P.C. on

Should a buyer be allowed to walk away from an acquisition if an extraordinary event occurs between signing and closing that forces the target company to take emergency remedial measures outside its ordinary course, even if...more

Stikeman Elliott LLP

Cineplex Awarded $1.24 Billion in Lost Synergies from Failed Cineworld Acquisition: Company’s Pandemic Response Not Out of the...

Stikeman Elliott LLP on

In a highly anticipated decision, the Ontario Superior Court of Justice – Commercial List held that Cineworld wrongly terminated its arrangement agreement to acquire Cineplex, which was awarded substantial damages....more

White & Case LLP

Notable decisions from Delaware courts

White & Case LLP on

Williams: Court of Chancery Finds Poison Pill Unenforceable - In February, the Delaware Court of Chancery held that a shareholder rights plan (a "poison pill") adopted by The Williams Companies, Inc. at the onset of the...more

Carlton Fields

Damages for Reps and Warranties Breaches

Carlton Fields on

When one party to an M&A agreement alleges that the other breached its representations and warranties, the damages analysis can be complex, depending on the terms of the agreement. Generally, a claim for indemnification due...more

Carlton Fields

The Perils of Using Baseball Arbitration to Resolve RWI Policy Disputes

Carlton Fields on

In the world of M&A and private equity deals, buyer-side representation and warranties insurance (RWI) transfers the risk of a seller’s representation to an insurer. To adequately safeguard the insurer, it therefore becomes...more

Carlton Fields

Value Claim: Non-Recurring Impact of Unknown Business or Operational Issue

Carlton Fields on

RWI valuation claims often arise from a breach of financial statement representation and warranties where the buyer asserts that the transaction was over-valued because prior earnings, on which the purchase price was based,...more

Carlton Fields

Breach vs. Loss

Carlton Fields on

Does a seller’s breach of representations and warranties in a merger and acquisition (M&A) transaction automatically entitle the buyer to compensation?...more

32 Results
 / 
View per page
Page: of 2

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
- hide
- hide