On May 8, 2025, Weil won a complete victory before the Delaware Supreme Court on behalf of AMC Entertainment (AMC) in long-running stockholder litigation, just one week after we argued the appeal. The Delaware Supreme Court affirmed the Delaware Court of Chancery’s dismissal of a post-settlement preferred stockholder challenge arising from an overhaul of the company’s capital structure.

Weil has been defending AMC in multi-faceted litigation arising from AMC’s creation of a new class of preferred securities called “APEs.” In this most recent victory, the Delaware Supreme Court affirmed the Delaware Court of Chancery’s dismissal of a stockholder litigation, which alleged that AMC breached the contractual rights of APE holders when AMC issued a settlement payment to resolve a 2023 stockholder action. This decision puts to an end years of litigation surrounding AMC’s APEs.

In 2023, Weil navigated the company through fast-tracked stockholder litigation in the Delaware Court of Chancery arising from its then-planned overhaul of its capital structure. Plaintiffs alleged that AMC’s senior management and board of directors breached their fiduciary duties by diluting common stockholders’ voting power through the creation of the APEs and a subsequent planned reverse stock split and conversion of APEs into common stock. Just weeks before a scheduled preliminary injunction hearing, our team negotiated a crucial settlement. As part of that settlement, which allowed AMC to overhaul its capital structure, common stockholders received additional shares of stock to account for the alleged harm resulting from the planned reverse stock split and conversion of APEs into common stock. The approval of the settlement – a normally mundane and uneventful phase of litigation – became highly contested, with an unprecedented number of objections to the settlement. Weil ultimately secured approval of the settlement, which was crucial for AMC. 

Once the settlement payment was issued, a former holder of APEs brought a new action alleging that the settlement payment violated anti-dilution and payment provisions in the certificate of designations that governed the rights of the APEs before they were converted into common stock, and arguing that holders of APEs were entitled to the same consideration that common stockholders received in connection with the settlement. Last fall, the Court of Chancery granted AMC’s motion to dismiss the APE litigation, and last week, the Delaware Supreme Court affirmed that dismissal, bringing to a close hard-fought litigation stemming from critical capital structure changes at AMC. 

The Weil team was led by global Litigation Department Co-Chair John Neuwirth, who argued the appeal, and included Securities Litigation partners Josh Amsel and Matt Connors and associates Tanner Stanley, Honghu Wang, Taylor Hoffman, and Stephanie Scanzillo.