Wachtell discusses Delaware Chancery Court’s Holding that Control over All Privileged Communications Passes to the Surviving Corporation in a Merger

Last week, the Delaware Court of Chancery ruled that an acquiring merger party obtains legal control of all of a target’s attorney-client communications, absent an express provision in a merger agreement to the contrary.  Great Hill Equity Partners IV, LP v. SIG Growth Equity Fund I, LLLP, C.A. No. 7906-CS (Del. Ch. Nov. 15, 2013).  In so ordering, the Delaware court declined to follow a decision of the New York Court of Appeals, Tekni-Plex, Inc. v. Meyner & Landis, 89 N.Y.2d 123 (1996), which held that a selling party retains control of those privileged pre-merger communications that … Read more

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Wachtell Lipton Discusses Class Certification Case Standing in Contrast to Amgen

A divided Supreme Court ruled 5 to 4 [in the last week of March] that certification of an antitrust class action was not proper because plaintiffs failed to establish that damages caused by actionable antitrust injury were capable of measurement on a class-wide basis.  Comcast Corp. v. Behrend, No. 11-864 (Mar. 27, 2013).

The proposed class plaintiffs in Comcast asserted antitrust claims based on defendants’ alleged conduct in concentrating operations in a particular region.  To certify a class under Fed. R. Civ. P. 23(b)(3) (which requires that questions of law or fact common to class members predominate), the district … Read more

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Wachtell Discusses the Supreme Court’s Decision in Amgen

A divided Supreme Court ruled on February 27th that proof of materiality is not a prerequisite to certification of a Rule 10b-5 securities fraud class action. Amgen Inc. v. Connecticut Retirement Plans and Trust Funds, No. 11-1085 (Feb. 27, 2013).

The elements of a Rule 10b-5 claim include proof of a material misrepresentation or omission and reliance upon such misrepresentation or omission. Plaintiffs in securities fraud class actions typically seek to invoke the “fraud-on-the-market” presumption set out in Basic Inc. v. Levinson, 485 U.S. 224 (1988) to establish reliance. In Basic, a case in which only a … Read more