This Morris James blog notes the Delaware Chancery Court’s recent decision in In re OM Group Stockholders Litigation – the latest in a series of decisions interpreting the Corwin standard. Here’s a excerpt:
Under the recent Corwin decision, a fully-informed vote by uncoerced and disinterested stockholders to approve a merger invokes the business judgment rule and effectively precludes almost any claim the merger was improper. Here, the alleged disclosure violations concerned (i) information regarding a competing bid, (ii) potential conflicts involving one director, and (iii) the banker’s compensation and potential conflicts.
Vice Chancellor Slights rejected each of the alleged disclosure violations – and explained when proxy disclosures are sufficient to invoke Corwin. He held that Corwin applied & that the board’s decision was protected by the business judgment rule.
– John Jenkins