Recent Trends in M erger Objection Litigation J udicial Fatigue - PowerPoint PPT Presentation

Recent Trends in M erger Objection Litigation ♦ J udicial Fatigue ♦ “ [This case] is an example of a now too common invocation of the iconic Revlon case in a circumstance where the key problem in Revlon – board resistance to the highest bidder based on a bias against that bidder – is entirely absent.” M orton’s Restaurant Group Inc. Shareholders’ Litigation, 2013 Del. Ch. Lexis 188 (Del. Ch. July 23, 2013) ♦ Dispositive M otion Success for Defendants ♦ M orton’s Restaurant Group Inc. Shareholders’ Litigation, 2013 Del. Ch. Lexis 188 (Del. Ch. July 23, 2013) (motion to dismiss). ♦ M iramar Firefighters Pension Fund et al. v. Abovenet, Inc., 2013 Del. Ch. Lexis 200 (Del. Ch. July 31, 2013) (motion to dismiss). ♦ SE Penn. Transp. Auth. v. Volgenau et al., 2013 Del. Ch. Lexis 197 (Del. Ch. Aug. 5, 2013) (motion for summary judgment). 1

Recent Trends in M erger Objection Litigation ♦ In response to increased frequency of merger objection suits, some insurers seeking to increase SIRs. ♦ Example: “ Section X, Limit of Liability and Retentions is amended by adding the following: Solely with respect to any M erger or Acquisition Claim made against any Insured for any actual or alleged Wrongful Acts , the Insurer shall only be liable for the amount of Loss arising from such M erger or Acquisition Claim which is in excess of the applicable Retention amount stated below [higher than regular SIR for Side B and Side C]. The Retention amount shall be borne by the Company with regard to all such Loss , provided, however, no retention amount shall apply with regard to any Loss under Coverage A of this Policy.” ♦ Underwriters report getting traction in market with SIRs of $1 - $1.5 million for mid-market insureds. 2

Selected Cases filed from J une – August 2013 ♦ Suits are increasingly frequent, with increasingly higher costs. ♦ Hulsebus et al. v. Belo Corp., et al. (Dallas County, TX) ($2.2B deal) ♦ Liu v. Asianfo-Linkage, Inc., et al. (Del. Ch.) ($890M deal) ♦ Crescente v. StellarOne Corp., et al. (W.D. VA) ($445M deal) ♦ M artin v. Warner Chilcott Public Ltd. Co. (D.N.J.) ($8.5B deal) ♦ Federman v. M aidenform Brands Inc., et al. (Del. Ch.) (575M deal) ♦ Fosket v. Brynes et al. (Del. Ch.) ($2.3B deal) ♦ Oliver v. Saks Inc., et al. (N.Y . Sup.) ($3B deal) ♦ Ansfield et al. v. Wren et al. (N.Y . Sup.) ($35B deal) Dyer et al. v. M inark et al. (Fla. 11 th Judicial Circuit) ($285M deal) ♦ ♦ Josenhans v. Sourcefire Inc., et al. (D. M d) ($2.7B deal) ♦ Biedler v. Stein et al. (Del. Ch.) ($818M deal) 3