Clients with major transactions routinely face shareholder and other litigation seeking to block or enforce a deal. As experienced and business-savvy litigators, we are able to fend off many such cases, often breaking new legal ground in the process.
Delaware Chancery Reiterates Reasonableness in Application of Revlon; Perfection Not Required
June 25, 2007 Full PDF
The recent In re Lear Corp. decision shows that the Delaware Chancery Court will continue to defer to board judgment even under the enhanced judicial standard required by Revlon where there is a record of reasoned board decision. As Chancellor Strine states, under Revlon, "[r]easonableness, not perfection, measured in business terms relevant to value creation, rather than by what creates the most sterile smell, is the metric." As discussed in the attached memo, what is particularly interesting in this opinion is Chancellor Strine's discussion of the Lear board's process, the factors that the directors considered in agreeing to the proposed merger with American Real Estate Partners, LP, the post-signing go-shop process and why the board's decision was reasonable under Revlon.