Quinn Emanuel Discusses SPAC Litigation Risks

Special purpose acquisition companies, or SPACs, took 2020 by storm, with nearly 250 SPACs raising around $83 billion through initial public offerings (“IPOs”)—more than the previous five years combined.[1] The SPAC boom has only accelerated in 2021, with over 200 SPACs raising nearly $70 billion by the start of March.[2]

A SPAC is a shell company that raises money through an IPO with the purpose of identifying a private company to merge with and bring public in what is commonly referred to as a “de-SPAC transaction.” If the SPAC does not identify a suitable target company within a specified period … Read more

Quinn Emanuel Discusses COVID-19 M&A Litigation in Delaware

Many high-profile transactions impacted by the COVID-19 pandemic have fallen apart between signing and closing, resulting in litigation – often in the Delaware Court of Chancery – focused on whether the buyer had an obligation to close.  Buyers backing out of transactions generally have asserted the occurrence of a “material adverse change” or “material adverse event” (“MAE”) and the failure of the to-be-acquired company to operate in the ordinary course of business.  Sellers generally have disputed that COVID-19 caused the failure of closing conditions, and have sued for specific performance of buyers’ obligations to close or damages.  As these cases … Read more