December 22, 2016
In December 2016, Weil won two significant victories in complex M&A-related litigation in Delaware Courts, breaking important new ground in defending against so-called appraisal arbitrageurs, and further limiting the circumstances in which investor plaintiffs can assert dual derivative and direct claims. Notably, the two victories – for Lender Processing Services following trial in Delaware Chancery Court, and for Kinder Morgan Inc. on appeal to the Delaware Supreme Court – saved Weil’s clients more than $250 million combined.
First, on December 16, Weil won a landmark case of great importance to the M&A transactional and litigation market in the Delaware Chancery Court’s most recent and eagerly anticipated appraisal decision. In a 74-page post-trial ruling, Vice Chancellor Laster applied 100% weight to the transaction price and ruled that petitioner, Merion Capital, an appraisal arbitrageur, was entitled to no additional consideration in connection with its appraisal petition arising out of Fidelity National Financial’s 2014 $4.2 billion acquisition of Lender Processing Services, Inc. Merion had sought approximately $90 million in additional consideration. The case was tried over four days in Delaware Chancery Court by a Weil team led by John Neuwirth, Co-Head of Weil’s Securities Litigation group, and that included associates Evert Christensen, Matthew Connors and Elizabeth Kerwin-Miller. To read more about this victory, please see here.
Then, on December 20, Weil secured a reversal by the Delaware Supreme Court of a $171 million trial verdict issued by the Delaware Court of Chancery in El Paso Pipeline GP Company, L.L.C. v. Brinckerhoff, No. 103, 2016 (Weil was appointed special appellate counsel following the verdict). The Supreme Court held that the plaintiff – a limited partner in a partnership who alleged that the partnership overpaid for certain assets – lost standing to pursue derivative claims challenging the transaction when the partnership later merged with a third party. Joseph Allerhand, co-head of Weil’s Securities Litigation practice, counsel Seth Goodchild, and associates Christine Di Guglielmo, Amanda Pooler, Nikolei Kaplanov, and Alexandria Swette were retained post-trial to represent the defendants on the appeal, and partnered with Kinder Morgan in-house counsel on the engagement. To read more about this victory, please see here.