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Mergers › Dilution

Cooley LLP

In Rare Dismissal of Up-C Reorganization Case, Chancery Court Holds That Claim Is Derivative, Not Direct 

Cooley LLP on

On April 10, 2025, the Delaware Court of Chancery granted a motion to dismiss in a breach of fiduciary duty action arising from BGC’s conversion from an Up-C corporation to a traditional full C corporation. While multiple...more

Morris James LLP

Dilution Claim in Which a Controller Received Additional Shares in Exchange for Its Interests, Was Exclusively Derivative

Morris James LLP on

Gentile v. Rossette, 906 A.2d 91, 100 (Del. 2006), held that dilution claims involving a controller can be both derivative and direct. In Gentile, the Delaware Supreme Court found that dilution claims, challenging a...more

Fenwick & West LLP

Delaware Supreme Court Holds That Dilution Claims Against a Controller Are Solely Derivative, Overruling Prior Precedent

Fenwick & West LLP on

On September 20, 2021, the Delaware Supreme Court took the highly unusual step of overruling its prior decision in Gentile v. Rossette. An oft-criticized precedent from 2006, Gentile created an exception allowing minority...more

Skadden, Arps, Slate, Meagher & Flom LLP

Valuation Challenges for Fintechs Highlight Legal Considerations in ‘Down Rounds’

Skadden, Arps, Slate, Meagher & Flom LLP on

In recent years, fintech has been an attractive sector for growth capital, as evidenced by robust investment and M&A valuations in the sector. While interest remained high in 2019, deal volumes began to level off early in the...more

A&O Shearman

Delaware Court Of Chancery Validates Ratification Of Defective Corporate Acts Impacting Merger And Declines To Expand Universe Of...

A&O Shearman on

On August 17, 2018, Chancellor Andre G. Bouchard of the Delaware Court of Chancery denied all of plaintiffs’ claims challenging a series of transactions culminating in the acquisition of defendant Design Within Reach, Inc....more

Sheppard Mullin Richter & Hampton LLP

Delaware Supreme Court Confirms that Dilution Claims Typically Are Derivative and Are Extinguished After a Merger

Sheppard Mullin Richter & Hampton LLP on

Stockholder claims alleging wrongful dilution are typically considered to be derivative in nature. Several decisions out of Delaware, however, have created exceptions to this general rule allowing stockholders to sue...more

Morris James LLP

Court Of Chancery Explains When A Minority Stockholder May Have Actual Control Over A Deal

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This is another in a series of decisions dealing with the allegation that a minority stockholder controlled a deal through its control of a majority of the board of directors....more

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