14Part two of this two-part series will focus on mergers without controlling stockholders and mergers that are subject to post-closing appraisal actions. Endnotes1 457 A.2d 701, 711 (Del. 1983).2 840 A.2d 641 (Table).3 902 A.2d 1130, 1149 (Del. Ch. 2006).4Id. at 1152.
3 Alpert v. 28 Williams St. Corp., 63 N.Y.2d 557, 473 N.E.2d 19, 483 N.Y.S.2d 667 (N.Y. 1984).4 In the matter of Kenneth Cole Productions, Inc. Shareholder Derivative Litigation, 122 A.D.3d 500, 998 N.Y.S.2d 1, 2014 N.Y. App. Div. LEXIS 8037, 2014 NY Slip Op 08105 (App. Div. 1st Dep’t 2014).5 In re MFW Shareholders Litigation, No. 6566-CS (Del. Chancery 2013); Kahn v. M&F Worldwide Corp., 88 A.3d 635 (Del. 2014).6 Weinberger v. UOP, Inc., 457 A.2d 701 (Del. 1983).7 Kahn v. Lynch Commc’n Sys., Inc., 638 A.2d 1110 (Del. 1994).8 In the matter of Kenneth Cole Productions, Inc., Shareholder Litigation, No. 54 (N.Y. Ct. App., May 5, 2016), 2016 NY Slip Op 03545, at 6-7, quoting Auerbach v. Bennett, 47 N.Y.2d 619, 623-24, 630-31 (1979).9 Id.
The Supreme Court affirmed in a one paragraph order, for the reasons set forth in the Court of Chancery bench ruling. Accordingly, our discussion is based on the trial court’s analysis as set forth in the transcript of its bench ruling.2 88 A.3d 635 (Del. 2014).3See, e.g., Weinberger v. UOP, Inc, 457 A.2d 701 (Del. 1983).4See Corwin v. KKR Fin. Holdings LLC, No. 629, 2014 (Del. Oct. 2, 2015). If you have any questions regarding this Sidley Update, please contact the Sidley lawyer with whom you usually work, or Jack B. JacobsSenior Counseljack.firstname.lastname@example.org +1 302 654 1805 Thomas A. ColePartnertcole@sidley.com +1 312 853 7473 Paul L. ChoiPartnerpchoi@sidley.com +1 312 853 2145 Scott M. FreemanPartnersfreeman@sidley.com +1 212 839 7358 Mark MettsPartnermmetts@sidley.com +1 713 495 4501James W. DucayetPartnerjducayet@sidley.com +1 312 853 7621Hille R. SheppardPartnerhsheppard@sidley.com +1 312 853 7850 Sidley M&A Practice Sidley Securities and Shareholder Litigation Practice To receive Sidley Updates, please subscribe at www.sidley.com/subscribe.Sidley Austin provides this information as a service to clients and other friends for educational purposes only.
50 price would have fallen toward the low end of the range of fair value or even have been below an acceptable value. Id., at 81-82 (quoting Weinberger v. UOP, Inc., 457 A.2d 701, 714 (Del. 1983)). Given the defendants’ actions, the Court concluded that the $13.
However, when one of these two constituencies approves the transaction, the burden of proof shifts from the defendant to the plaintiff to show “fair dealing” and a “fair price.” Weinberger v. UOP, Inc., 457 A.2d 701 (1983). However, the question of what the correct standard of review should be when there is approval by both an independent committee and an informed majority-of-the-minority vote had not been resolved.
Because it found that the issue had not been decided by Pennsylvania state courts, the Third Circuit looked to other authorities for guidance. Looking to Delaware as "the vanguard of corporate law," the court found persuasive the holdings of the Delaware Supreme Court in Weinberger v. UOP, 457 A.2d 701 (1983), in which the court ruled that, even with an expanded view of "fair value" in appraisal actions that allows consideration of "all relevant factors," the appraisal remedy "may not be adequate in certain cases, particularly where fraud, misrepresentation, self-dealing, deliberate waste of corporate assets or gross and palpable overreaching are involved," and Cede v. Technicolor, 542 A.2d 1182 (1988), holding that appraisal and suits for self-dealing "serve different purposes and are designed to provide different, and not interchangeable, remedies." The Third Circuit also considered Section 1105's purpose, finding that the statute was intended to prevent minority shareholders from blocking transactions favored by the majority and "to allow the merger to proceed and avoid suits which stymied corporate consolidation and growth."