The state of Delaware is home to many corporations, also making it a prime location for merger class action lawsuits. North Carolina Lawyers Weekly recently interviewed Smith Anderson Partner Don Tucker about local implications of a major decision from Delaware’s Court of Chancery.
The case, arising out of Zillow’s $3.5 billion takeover of Trulia, involved a “disclosure only” settlement where the defendant agreed to provide additional information about the merger (but no monetary benefit) and to pay plaintiff’s attorneys fees. The plaintiffs, in return, agreed to give defendants a broad release of claims. The court refused to approve the settlement.
In a recent North Carolina case, the North Carolina Business Court noted the outcome in the Trulia case, but allowed a disclosure-only settlement to go forward, finding that there was an appropriate balance between the benefit the stockholders received and what they gave up through their release of defendants.
Commenting on these development, Don told Reporter Jeff Jeffrey that “The judges on the [North Carolina] Business Court are certainly aware of what is going on in Delaware. I think it’s fair to say they’re going to take a close look at settlements in our state to make sure they are fair and reasonable.” Don advised, however, that it was too early to predict any broader trends, or to say whether North Carolina might adopt an approach that that was significantly different than in Delaware.
Don Tucker has over 30 years of complex commercial litigation experience, including multi-party cases, class actions, claims under the federal securities laws, shareholder and partnership disputes and contract disputes of many types.