Delaware Finds Reverse Triangular Mergers Aren't Assignments
John Grossbauer of Potter Anderson notes: In Meso Scale Diagnostics v. Roche Diagnostics, Delaware Vice Chancellor Parsons granted summary judgment in favor of defendants on the question whether a reverse triangular merger could be an "assignment by operation of law" of a license agreement. The Court declined to follow the decision of the Northern District of California in SQL Solutions v. Oracle, which had reached the opposite conclusion.
The summary judgment opinion should provide comfort on the issue the Vice Chancellor had raised in his motion to dismiss opinion, in which he found it possible at that stage that an assignment could have occurred. The Vice Chancellor refused to grant summary judgment on the issue whether plaintiffs could enforce a license agreement to which they were not parties but to which they both consented and "joined in," finding the contracts at issue ambiguous on this point.