Insights: The Delaware Edition

Skadden, Arps, Slate, Meagher & Flom LLP

In this issue, we discuss recent Delaware court developments regarding officer liability, who can recover “lost-premium” damages, and trends in books and records actions, among other topics.

Court of Chancery Finds Officer Liable for Competing With Corporation and Misappropriating Trade Secrets
A recent court ruling underscores that corporate directors and officers who are planning to provide services to a second entity must understand the interplay between their new duties and their current obligations and fiduciary duties.

‘Busted Deals and Damages: Court of Chancery Clarifies Who Can Recover ‘Lost-Premium’ Damages
In Crispo v. Musk, the Court of Chancery explained that a “lost-premium provision” in the merger agreement could not be enforced by the target and left open the question as to whether it could be enforced by stockholders.

Books and Records Demands 2023 Recap: Courts Continue To Develop the Law Regarding the Scope of Inspection
The court has established a new process for books and records actions, but other trends remain, including the general expectation that companies provide board-level materials and fee-shifting where a company engages in extreme conduct.

Real World Examples Where Conflicts Tainted a Deal Process, and Other Deals That Were Insulated From Conflicts
There are no hard and fast rules for dealing with conflicted fiduciaries who are involved in a deal, but recent Delaware decisions provide boards with some guidance on ways to protect the integrity of a deal — and situations to avoid.

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