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Delaware Court of Chancery Dismisses Breach of Fiduciary Duty and Quasi-Appraisal Claims

May 16, 2017 Download PDF

Recently, the Delaware Court of Chancery dismissed a fiduciary duty claim and a request for a quasi-appraisal remedy in connection with the acquisition of Cyan, Inc. by Ciena Corporation. The court held that the business judgment rule applied to the Cyan board’s decision to approve the mostly stock-for-stock merger, a holding further reinforced under the Corwin doctrine because Cyan shareholders had voted to approve the deal. The court also found the board conflicts the shareholders alleged to be insufficient to rebut the business judgment rule. The court also denied shareholders’ request for a quasi-appraisal remedy, finding that they had failed to adequately allege any material disclosure deficiencies.

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