A New Front in M&A Litigation: Alleged Violations of Delaware’s Antitakeover Law

Davis Polk – Plaintiff stockholder litigation against announced M&A deals continues to be a common feature of the U.S. M&A landscape, despite the prevalence of forum selection bylaws, the demise of disclosure only settlements and general skepticism by the Delaware courts.  Over the last 18 months, however, plaintiff stockholders have opened a new line of attack by claiming that discussions and negotiations of support agreements to vote or tender in favor of a merger, and rollover agreements (at times requested by private equity sponsors), trigger Section 203 of the Delaware General Corporation Law.

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