In ATP Tour, Inc. v. Deutscher Tennis Bund, the Delaware Supreme Court, by Justice Berger, in responding to certified questions of law from the United States District Court for the District of Delaware, held that a provision of a Delaware nonstock corporation’s bylaws that shifted litigation expenses to the losing party in intra-corporate litigation was facially valid under Delaware law and may be enforced if the provision was adopted through appropriate corporate procedures and for a proper corporate purpose.

In recent months, Delaware courts have addressed a number of issues important to Delaware corporations and their advisors.

In In re Answers Corporation Shareholders Litigation, the Court of Chancery, by Vice Chancellor Noble, granted summary judgment in favor of defendants in an action brought by stockholder plaintiffs challenging the merger by which Answers Corporation was acquired by AFCV Holdings, LLC, a portfolio company of private equity firm Summit Partners, L.P., for $10.50 per share.

In In re Orchard Enterprises, Inc., the Court of Chancery, by Vice Chancellor Laster, on cross motions for summary judgment, held, among other things, that the entire fairness standard of review will apply at trial to fiduciary duty claims challenging a squeeze-out merger, with the burden of persuasion on the defendants, notwithstanding that the merger was negotiated by a special committee and approved by a majority of the minority stockholders.

In Chen v. Howard-Anderson, the Court of Chancery, by Vice Chancellor Laster, ruling on a motion for summary judgment, held that, in a change of control case where the standard of review is enhanced scrutiny, directors and officers could be found liable for acting in bad faith (and thus breach their fiduciary duty of loyalty) if plaintiffs cite evidence sufficient to support an inference that the directors and officers acted unreasonably in conducting the sale process and allowed interests other than the pursuit of obtaining the best price reasonably available to influence their actions. In so holding, the Court distinguished the Delaware Supreme Court’s decision in Lyondell Chemical Co. v. Ryan.

In Houseman v. Sagerman, the Court of Chancery, by Vice Chancellor Glasscock, in addressing defendants’ motion to dismiss claims related to the 2011 acquisition of Universata, Inc. by HealthPort Technologies, LLC, held that the failure to obtain a fairness opinion in connection with the acquisition did not rise to the level of bad faith on the part of the board of directors of Universata and did not support an aiding and abetting claim against the Board’s financial advisor.

In Hamilton Partners, L.P. v. Highland Capital Management, L.P., the Court of Chancery, by Vice Chancellor Noble, in connection with a challenge to a going-private transaction whereby American HomePatient, Inc. was acquired by an affiliate of one of its stockholders, Highland Capital Management, L.P., refused to dismiss breach of fiduciary duty claims against Highland.

Getting the Deal Through is delighted to publish the twelfth edition ofDispute Resolution, a volume in our series of annual reports, which provides international analysis in key areas of law and policy for corporate counsel, cross-border legal practitioners and business people.

This article discusses the impact that Section 503(b)(9) of the Bankruptcy Code may have on the funding needs of a case and explores the manner in which the Delaware bankruptcy court has addressed the issue.

On April 1, Trupanion Inc. and its chief executive officer filed what is believed to be the first petition seeking relief in the Delaware Court of Chancery pursuant to Section 205 of the Delaware General Corporation Law. In less than a month, the Chancery Court issued a final order in the action, resolving multiple questions relating…