skip to main content

Clients with major transactions routinely face shareholder and other litigation seeking to block or enforce a deal. As experienced and business-savvy litigators, we are able to fend off many such cases, often breaking new legal ground in the process.

 

Representative Engagements

  • “Material Adverse Effect” Litigations
    • Fresenius SE & Co., a German healthcare company, in a landmark ruling, affirmed by the Delaware Supreme Court, that Fresenius was justified in terminating a $4.8 billion merger agreement with Akorn Pharmaceuticals due to Akorn’s post-signing decline and Akorn’s blatant breaches of FDA data integrity requirements, both constituting Material Adverse Events (MAE) under Delaware law. The decision was the first to find an MAE justified based on post-signing financial decline and other factors.
    • Channel Medsystems, Inc., a medical device start-up, in a trial victory in connection with a “material adverse change” litigation with Boston Scientific Corporation in which Boston Scientific unsuccessfully sought to terminate its $250 million acquisition of the company.
    • 1-800-Flowers.com, a floral and gourmet foods gift retailer, in defense of a breach of contract action brought in the Delaware Court of Chancery by Bed Bath & Beyond, alleging that 1-800-Flowers.com breached its agreement to purchase PersonalizationMail.com.
    • Kohlberg & Co. in a merger dispute with Snow Phipps Group, which sued Kohlberg after Kohlberg sought to terminate a $550 million deal to acquire DecoPac Inc., a baking goods manufacturer. Kohlberg had terminated the merger, asserting that a material adverse event had taken place due to the COVID-19 pandemic’s impact on the business as well as the unavailability of deal financing. Paul, Weiss successfully defeated a motion to expedite proceedings in advance of the deal’s drop dead date.
    • Alere, Inc., a medical device and point-of-care testing company, in its closely-watched “material adverse change” litigation with Abbott Laboratories in which, after an expedited proceeding, we achieved a settlement whereby Abbott agreed to close the $5.3 billion acquisition.
  • Breach of Fiduciary Duty Litigations
    • Funds affiliated with Apollo Global Management, LLC in:
      • successfully defending a shareholder class action arising from Apollo’s $560 million acquisition of CORE Media Group, where plaintiffs claimed entities affiliated with Apollo aided and abetted CORE’s directors in alleged breaches of their fiduciary duties in failing to disclose material information and in fixing an unfair price per share; and
      • securing dismissal of claims against Apollo for aiding and abetting the alleged breaches of fiduciary duty of ClubCorp’s directors in a $2.2 billion take-private transaction.
    • Dominion Diamond in the successful defense of a preliminary injunction proceeding in which a class of shareholders sought to enjoin the $1.2 billion acquisition of Dominion Diamond by The Washington Companies.
    • Elliott Associates in the dismissal, affirmed on appeal, of a stockholder challenging Thoma Bravo’s acquisition of Compuware Corporation. Plaintiffs—the former chairman and CEO of Compuware and his four minor children, all former Compuware shareholders—asserted twelve causes of action against Compuware, certain of Compuware’s former directors and officers, Thoma Bravo and Elliott Associates, including, among other causes of action, breach of fiduciary duty, aiding and abetting breach of fiduciary duty, and various fraud claims.
    • Emdeon Business Services LLC in the resolution of breach of fiduciary duty claims brought by a shareholder class arising out of the company’s $3 billion sale to the Blackstone Group.
    • Grupo Elektra in the favorable settlement of shareholder litigation arising out of its $780 million acquisition of Advance America, Cash Advance Center, Inc., where shareholders alleged Grupo Elektra aided and abetted breaches of fiduciary duty by Advance America’s board.
    • Kohlberg Kravis Roberts & Co. in the successful settlement of a shareholder derivative action asserting breach of fiduciary duty claims that arose out of the buy-out of Primedia, Inc. by affiliates of TPG Capital, L.P.
    • Imperial Sugar Company in the dismissal of multiple shareholder suits alleging breaches of fiduciary duty in connection with Imperial’s merger with Louis Dreyfus Commodities.
    • M&F Worldwide Corporation and its board of directors in the dismissal on summary judgment, affirmed on appeal, of a suit brought by a group of minority shareholders who challenged the fairness of a going-private transaction negotiated by a special committee and approved by a majority of the minority shareholders.
    • Mitel Networks Corporation, a Canadian telecom company, in the settlement of breach of fiduciary duty claims asserted by a class of stockholders of Mavenir Systems, Inc., a software solutions company, stemming from Mitel’s $1.4 billion acquisition of Mavenir.
    • Morgan Stanley Private Equity Asia in the successful defense of shareholder litigation in Nevada state court arising out of a $339 million buy-out of Yongye International, a Chinese Agricultural nutrient company. We defeated two successive preliminary injunction motions and the transaction closed.
    • Oaktree Capital Management and its portfolio company, Pulse Electronics, in the favorable settlement of a shareholder merger litigation alleging that Pulse and its directors breached their fiduciary duties in failing to obtain the best possible value for Pulse in Oaktree’s buy-out of the company.
    • Ovintiv Inc. in its successful defense of shareholder litigation asserting breach of fiduciary duties arising out of Ovintiv's acquisition of Athlon Energy Inc. in a transaction valued at approximately $7.1 billion.
    • Time Warner Cable and its board of directors in stockholder class action litigations filed in New York and Delaware challenging Time Warner Cable’s proposed $45.2 billion acquisition by Comcast Corporation.
    • Virtu Financial, Inc. in the successful resolution of a preliminary injunction challenging Virtu’s $1.4 billion acquisition of Knight Capital Group Holdings Inc. which was brought under Section 202 of the Delaware Corporation Law and also asserted breach of fiduciary duty and disclosure-related claims.
    • The Special Committee and additional independent directors of Expedia Group Inc., a travel platform, in defense of an ongoing shareholder class action brought in the Delaware Court of Chancery by holders of Expedia Group Inc. common stock alleging that the directors violated their fiduciary duties by approving the company’s acquisition of its subsidiary, Liberty Expedia Holdings Inc., and by approving related changes to a governance agreement with the Chairman of Expedia Group Inc.
    • The Special Committee of the Board of Directors of Pilgrim’s Pride Corporation in the successful defense of shareholder litigation arising out of Pilgrim’s Pride’s $1.3 billion acquisition of Moy Park.
    • The Special Committee of the Board of Directors of Winn-Dixie Stores, Inc. in the successful defense of shareholder litigation filed in federal and state courts that sought to block the $560 million sale of Winn-Dixie to BI-LO LLC, a portfolio company of Lone Star Funds.
  • Disclosure-Related Litigations
    • Air Methods Corporation in successfully resolving multiple securities litigations filed in the federal courts in connection with Air Method’s $2.5 billion buyout by affiliates of American Securities, LLC.
    • Ariad Pharmaceuticals and its directors in defending shareholder litigation that alleged Ariad’s disclosures concerning the company’s $5.2 billion sale to Takeda Pharmaceutical Co. were false and misleading.
    • AR Capital and its partners in the defense of shareholder litigation challenging the proxy statement issued in connection with the merger of two AR Capital-sponsored REITs asserting federal disclosure claims as well as state law claims for breach of fiduciary duty.
    • Bank of America in securing the successful settlement of SEC claims in connection with alleged proxy statement misrepresentations and omissions made by BofA regarding the bank’s acquisition of Merrill Lynch & Co., as well as subsequent settlements with a shareholder class and the Office of the New York Attorney General concerning those same disclosures.
    • Bioverativ and its board of directors in resolving disclosure claims arising out of Bioverativ’s $11.6 billion acquisition by Sanofi.
    • CSRA and its board of directors in settling disclosure claims related to CSRA’s $9.7 billion acquisition by General Dynamics.
    • GP Investments in its successful resolution of disclosure claims related to its $100 million acquisition of Bravo Brio Restaurant Group.
    • ILG, Inc. and its board of directors in resolving disclosure claims arising out of ILG’s $4.7 billion acquisition by Marriott Vacations Worldwide Corporation.
    • Kate Spade and its board of directors in settling disclosure-related claims related to Kate Spade’s $2.4 billion acquisition by Coach.
    • Nicholas Schorsch, former CEO of American Realty Capital Properties, in the defense of class action and individual shareholder litigation challenging disclosures made in connection with the acquisition by ARCP of several entities.
    • Omega Protein Corporation and its board of directors in various state and federal shareholder lawsuits asserting that Omega’s disclosures in the proxy statement were false and misleading. All plaintiffs voluntarily dismissed their actions and the transaction closed.
    • Pattern Energy Group Inc., a California-based independent power company, in connection with several federal securities litigations brought by shareholders concerning its $6.1 billion merger agreement with Canada Pension Plan Investment Board (CPPIB).
    • Ply Gem Industries in the successful resolution of shareholder class actions alleging disclosure-related claims arising out of the $2.4 billion buyout of Ply Gem by Clayton, Dubilier & Rice.
    • Restaurant Brands International in the successful settlement of shareholder class actions alleging disclosure-related claims arising out of its $1.8 billion acquisition of Popeye’s Louisiana Kitchen.
    • Silver Bay Realty Trust Corporation and its board of directors in the successful dismissal of claims filed by a class of shareholders in federal court alleging misrepresentations and omissions in Silver Bay’s proxy statement in connection with its $1.4 billion acquisition by Tricon Capital Group.
    • Taylor Morrison in the settlement of disclosure claims related to Taylor Morrison’s $963 million acquisition of AV Homes.
    • UCP, Inc. and its board of directors in settling disclosure-related claims relating to its $356 million acquisition by Century Communities.
  • Appraisal Litigations
    • CKx, Inc. in the successful defense of an appraisal proceeding in which the Chancery Court held, after a full trial on the merits, that the merger price being offered by the acquirer, certain funds managed by affiliates of Apollo Global Management, LLC, was the best available measure of CKx’s fair value. That decision was affirmed by the Delaware Supreme Court.
    • Diamond Resorts International, Inc. in the defense of a consolidated appraisal proceeding in which shareholders who did not tender their shares during the company’s $2.2 billion acquisition by funds managed by affiliates of Apollo Global Management, LLC, petitioned for an appraisal of the fair value of their shares.
    • Oaktree Capital Management in securing a favorable settlement of appraisal case related to Oaktree’s buy-out of Pulse Electronics.

© 2020 Paul, Weiss, Rifkind, Wharton & Garrison LLP

Privacy Policy