MNAT http://www.mnat.com/blog/ Recent news en-us Tue, 28 Jul 2015 04:19:40 -0400 Governor Markell Signs Second Leg of Unclaimed Property Reform Legislation into Law http://www.mnat.com/blog/governor-markell-signs-second-leg-of-unclaimed-property-reform-legislation-into-law/ On July 22, 2015, Delaware Governor Jack Markell signed Senate Bill No. 141 into law. The bill was introduced in the Delaware State Senate on June 16, 2015 and passed the Delaware House in the early morning hours of July 1, 2015. The speed with which this legislation passed indicates that Delaware is serious about reforming its Unclaimed Property Program.

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2015-07-24 11:10:39 http://www.mnat.com/blog/governor-markell-signs-second-leg-of-unclaimed-property-reform-legislation-into-law/
Todd Flubacher Named an Accredited Estate Planner® Designee http://www.mnat.com/news/todd-flubacher-named-an-accredited-estate-planner-designee/ 2015-07-15 00:00:00 http://www.mnat.com/news/todd-flubacher-named-an-accredited-estate-planner-designee/ Delaware Court of Chancery Awards Less Than Merger Price in Appraisal Proceeding http://www.mnat.com/blog/delaware-court-of-chancery-awards-less-than-merger-price-in-appraisal-proceeding/ In a decision consistent with the outcome of a number of recent appraisal cases, the Delaware Court of Chancery in LongPath Capital, LLC v. Ramtron International Corp. relied on the negotiated merger price as the best evidence of “fair value” for purposes of Section 262 of the Delaware General Corporation Law.  And, in the most noteworthy portion of the decision, the Court took the additional step of deducting merger related synergies from the merger price to determine fair value.

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2015-07-09 16:26:37 http://www.mnat.com/blog/delaware-court-of-chancery-awards-less-than-merger-price-in-appraisal-proceeding/
Second Leg of Unclaimed Property Reform Legislation Passed by the Delaware Legislature http://www.mnat.com/blog/second-leg-of-unclaimed-property-reform-legislation-passed-by-the-delaware-legislature-/ On June 16, 2015, Senate Bill No. 141 was introduced in the Delaware State Senate.  In the early morning hours of July 1, 2015 (with the Delaware “legislative calendar” still reading June 30, 2015) this legislation, which had already passed the State Senate, passed the Delaware House and awaits Governor Jack Markell’s signature.  The speed with which this legislation passed indicates that Delaware is serious about reforming its Unclaimed Property Program.

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2015-07-01 09:00:00 http://www.mnat.com/blog/second-leg-of-unclaimed-property-reform-legislation-passed-by-the-delaware-legislature-/
The Death of the Dead-Hand Poison Put? http://www.mnat.com/blog/the-death-of-the-dead-hand-poison-put/ Morris Nichols attorneys Bill Lafferty, John DiTomo and Mac Measly contributed this article on the Delaware Court of Chancery ruling in Healthways II concerning a so-called “dead hand proxy put” provision in a credit agreement. The authors discuss proxy put trends, the history of the case and practical implications.

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2015-06-30 14:39:02 http://www.mnat.com/blog/the-death-of-the-dead-hand-poison-put/
Morris Nichols Recognized at 2015 Turnaround Atlas Awards http://www.mnat.com/news/morris-nichols-recognized-at-2015-turnaround-atlas-awards/ 2015-06-27 00:00:00 http://www.mnat.com/news/morris-nichols-recognized-at-2015-turnaround-atlas-awards/ Delaware Public Policy Institute Elects Michael Houghton to Board of Trustees http://www.mnat.com/news/delaware-public-policy-institute-elects-michael-houghton-to-board-of-trustees/ 2015-06-19 00:00:00 http://www.mnat.com/news/delaware-public-policy-institute-elects-michael-houghton-to-board-of-trustees/ IAM Patent 1000 2015 Ranks Morris Nichols a “Gold” Firm in Delaware http://www.mnat.com/news/iiam-patent-1000i-2015-ranks-morris-nichols-a-gold-firm-in-delaware/ 2015-06-18 09:46:35 http://www.mnat.com/news/iiam-patent-1000i-2015-ranks-morris-nichols-a-gold-firm-in-delaware/ Greg Werkheiser Moderates ABI Discussion of Supreme Court’s Ruling in Baker Botts LLP v. ASARCO LLC http://www.mnat.com/news/greg-werkheiser-moderates-abi-discussion-of-supreme-courts-ruling-in-baker-botts-llp-v-asarco-llc/ 2015-06-18 00:00:00 http://www.mnat.com/news/greg-werkheiser-moderates-abi-discussion-of-supreme-courts-ruling-in-baker-botts-llp-v-asarco-llc/ Using Financial Advisor Engagement Letters to Vet Potential Conflicts of Interest http://www.mnat.com/blog/using-financial-advisor-engagement-letters-to-vet-potential-conflicts-of-interest/ Financial advisors often are selected by a board of directors (or committee thereof) to advise on a strategic review process because of their role as brokers in the market and their ability to generate transactional activity. Of course, that role and ability is dependent upon relationships with potential counterparties to a transaction. Because financial advisors are hired in part to exploit their relationships with potential counterparties, inevitably conflicts of interest will arise. Delaware law clearly permits directors to make a decision that the benefits of engaging a particular financial advisor (including, in many cases, that financial advisor’s contacts in the market or particular industry) outweigh any potential detriments arising from potential conflicts of interest. That decision, however, must be fully informed.

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2015-06-17 09:36:52 http://www.mnat.com/blog/using-financial-advisor-engagement-letters-to-vet-potential-conflicts-of-interest/
Pleading Direct Patent Infringement Without Form 18 http://www.mnat.com/blog/pleading-direct-patent-infringement-without-form-18/ The way plaintiffs plead direct patent infringement may be about to change. Currently, the use of Form 18 suffices to plead a claim of direct patent infringement, despite what many courts and commentators believe is insufficient factual information required by that form. Recognizing that deficiency, the Federal Rules Advisory Committee recently submitted a proposal to the U.S. Supreme Court to abolish Form 18. The Supreme Court adopted that change on April 29, 2015.

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2015-06-16 12:11:09 http://www.mnat.com/blog/pleading-direct-patent-infringement-without-form-18/
Second Leg of Unclaimed Property Reform Legislation Introduced in Delaware Senate http://www.mnat.com/blog/second-leg-of-unclaimed-property-reform-legislation-introduced-in-delaware-senate/ On June 16, 2015, Senate Bill No. 141 was introduced in the Delaware State Senate.  This bill proposes what may well be the most important statutory changes ever made to the existing Delaware Unclaimed Property Program.  The second of two bills introduced this legislative session, Senate Bill No. 141 incorporates a number of the recommendations of a Legislative Task Force established by the Delaware General Assembly in 2014 to review and make recommendations to improve fairness and foster compliance with Delaware’s Unclaimed Property Program.

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2015-06-16 11:53:05 http://www.mnat.com/blog/second-leg-of-unclaimed-property-reform-legislation-introduced-in-delaware-senate/
Greg Werkheiser Quoted in BNA’s Bankruptcy Law Reporter on ASARCO Decision http://www.mnat.com/news/greg-werkheiser-quoted-in-embnas-bankruptcy-law-reporterem-on-asarco-decision/ 2015-06-15 00:00:00 http://www.mnat.com/news/greg-werkheiser-quoted-in-embnas-bankruptcy-law-reporterem-on-asarco-decision/ Eric Klinger-Wilensky Quoted in The Deal on Engagement Letters http://www.mnat.com/news/eric-klingerwilensky-quoted-in-ithe-deali-on-engagement-letters/ 2015-06-12 00:00:00 http://www.mnat.com/news/eric-klingerwilensky-quoted-in-ithe-deali-on-engagement-letters/ Lawdragon Names Bill Lafferty Among 500 Leading Lawyers in America http://www.mnat.com/news/lawdragon-names-bill-lafferty-among-500-leading-lawyers-in-america/ 2015-06-08 00:00:00 http://www.mnat.com/news/lawdragon-names-bill-lafferty-among-500-leading-lawyers-in-america/ Who’s Who Legal: Patents 2015 Recognizes Four Morris Nichols Partners http://www.mnat.com/news/i-who-s-who-legal-patents-2015-i-recognizes-four-morris-nichols-partners/ 2015-06-06 00:00:00 http://www.mnat.com/news/i-who-s-who-legal-patents-2015-i-recognizes-four-morris-nichols-partners/ The Legal 500 Ranks Morris Nichols as a Leading M&A Firm in the United States http://www.mnat.com/news/em-the-legal-500-em-ranks-morris-nichols-as-a-leading-m-a-firm-in-the-united-states/ 2015-06-03 00:00:00 http://www.mnat.com/news/em-the-legal-500-em-ranks-morris-nichols-as-a-leading-m-a-firm-in-the-united-states/ Enforcing a Private Company Indemnity Regime http://www.mnat.com/blog/enforcing-a-private-company-indemnity-regime/ Whether a private company acquisition is structured as a stock sale or a merger, the parties will often include in their deals provisions that specify when a buyer can bring claims for breach of representations. These provisions often take the form of highly negotiated indemnification provisions in the deal documents. In a stock sale, the sellers are party to the agreement, so that they are directly bound by the indemnity provisions. That is not the case, however, in a merger; under Delaware law, the selling stockholders are not required to be a party to the merger agreement. Thus, it is important to consider how the indemnification regime will be enforced against stockholders of the seller corporation in a private corporation acquisition structured as a merger.

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2015-06-01 11:22:40 http://www.mnat.com/blog/enforcing-a-private-company-indemnity-regime/
What Distressed Cos. Can Take Away from Quadrant v. Vertin http://www.mnat.com/blog/what-distressed-cos-can-take-away-from-em-quadrant-v-vertin-em/ On May 4, 2015, the Delaware Court of Chancery issued an opinion in Quadrant Structured Products Co. Ltd. v. Vertin that provides important guidance to those counseling distressed Delaware corporations and their stakeholders. The issue in Vertin was whether a creditor suing derivatively on behalf of an insolvent corporation loses standing to maintain that lawsuit if the corporation becomes solvent while the lawsuit is pending. In a matter of first impression, the Court of Chancery held that the creditor does not lose standing, but rather standing is determined as of the date the suit was filed.

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2015-05-28 15:42:33 http://www.mnat.com/blog/what-distressed-cos-can-take-away-from-em-quadrant-v-vertin-em/
Managing Intellectual Property Recognizes Morris Nichols in 2015 IP Stars Guide http://www.mnat.com/news/managing-intellectual-property-recognizes-morris-nichols-in-2015-ip-stars-guide/ 2015-05-27 15:29:20 http://www.mnat.com/news/managing-intellectual-property-recognizes-morris-nichols-in-2015-ip-stars-guide/ Third Circuit Holds Structured Dismissal Deviating from Bankruptcy Code Priority Scheme May Be Utilized in Appropriate Circumstances http://www.mnat.com/blog/third-circuit-holds-structured-dismissal-deviating-from-bankruptcy-code-priority-scheme-may-be-utilized-in-appropriate-circumstances/ On May 21, 2015, the United States Court of Appeals for the Third Circuit answered the long-asked question of whether structured dismissals are permissible under the Bankruptcy Code with a resounding yes.  In so ruling, the Third Circuit stated: “[W]e believe the Code permits a structured dismissal, even one that deviates from the § 507 priorities, when a bankruptcy judge makes sound findings of fact that the traditional routes out of Chapter 11 are unavailable and the settlement is the best feasible way of serving the interests of the estate and its creditors.”  The opinion provides much awaited guidance on the availability of structured dismissals as a mechanism to conclude a case.

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2015-05-26 15:43:54 http://www.mnat.com/blog/third-circuit-holds-structured-dismissal-deviating-from-bankruptcy-code-priority-scheme-may-be-utilized-in-appropriate-circumstances/
Two Morris Nichols Attorneys Announced As Winners of the 6th Annual 40 Under 40 Emerging Leader Awards http://www.mnat.com/news/two-morris-nichols-attorneys-announced-as-winners-of-the-6th-annual-40-under-40-emerging-leader-awards/ 2015-05-21 13:01:01 http://www.mnat.com/news/two-morris-nichols-attorneys-announced-as-winners-of-the-6th-annual-40-under-40-emerging-leader-awards/ Chambers USA 2015 Ranks 23 Morris Nichols Attorneys and 4 Practice Groups Among the Best in Delaware http://www.mnat.com/news/chambers-usa-2015-ranks-23-morris-nichols-attorneys-and-4-practice-groups-among-the-best-in-delaware/ 2015-05-19 00:00:00 http://www.mnat.com/news/chambers-usa-2015-ranks-23-morris-nichols-attorneys-and-4-practice-groups-among-the-best-in-delaware/ Delaware Supreme Court Issues Important Opinion on Interested Transactions http://www.mnat.com/blog/delaware-supreme-court-issues-important-opinion-on-interested-transactions/ In an opinion on a consolidated appeal in In re Cornerstone Therapeutics Inc. Stockholder Litigation and Leal v. Meeks, the Delaware Supreme Court held that, regardless of the underlying standard of review (including in interested transactions subject to entire fairness review), a claim solely for monetary damages against a facially independent director of a corporation with an exculpatory charter provision will be dismissed unless a plaintiff has alleged facts to support a non-exculpated claim with respect to that director.  The Supreme Court clarified that its prior decisions in Emerald Partners v. Berlin, which many practitioners and some members of the Court of Chancery had interpreted as requiring that claims against all directors challenging a transaction to which the entire fairness standard applied survive a motion to dismiss, did not control the specific question at issue in the appeals.  Morris Nichols represented the appellants in Leal v. Meeks.

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2015-05-15 14:27:32 http://www.mnat.com/blog/delaware-supreme-court-issues-important-opinion-on-interested-transactions/
16 Morris Nichols Attorneys Selected for Inclusion in 2015 Delaware Super Lawyers http://www.mnat.com/news/16-morris-nichols-attorneys-selected-for-inclusion-in-2015-delaware-super-lawyers/ 2015-05-15 00:00:00 http://www.mnat.com/news/16-morris-nichols-attorneys-selected-for-inclusion-in-2015-delaware-super-lawyers/ Court of Chancery Approves Settlement of Stockholder Challenge to “Dead Hand Proxy Put” and Offers Important Guidance on Prior Ruling http://www.mnat.com/blog/court-of-chancery-approves-settlement-of-stockholder-challenge-to-dead-hand-proxy-put-and-offers-important-guidance-on-prior-ruling/ In approving a settlement of a stockholder class action challenging a so-called “dead hand proxy put” provision in a credit agreement between Healthways, Inc. and SunTrust Bank, Vice Chancellor J. Travis Laster provided important guidance regarding his prior ruling in the same case denying defendants’ motions to dismiss – a decision which he stated “was probably one of the more frequently misrepresented or misunderstood rulings of mine.”  See Pontiac Gen. Employees Retirement Syst. v. Ballantine, C.A. No. 9789-VCL (Del. Ch. May 8, 2015).  In explaining his prior ruling, Vice Chancellor Laster sought to dispel what he characterized as “an alarmist view that liability, in fact, was established” by his prior ruling.

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2015-05-14 14:28:11 http://www.mnat.com/blog/court-of-chancery-approves-settlement-of-stockholder-challenge-to-dead-hand-proxy-put-and-offers-important-guidance-on-prior-ruling/
Strategic M&A Involving Public Companies http://www.mnat.com/blog/strategic-m-a-involving-public-companies2/ R.J. Scaggs participated in the panel discussion “Strategic M&A Involving Public Companies” at the 3rd Annual Midwestern M&A/Private Equity Forum in Chicago on May 13, 2015.

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2015-05-13 10:43:35 http://www.mnat.com/blog/strategic-m-a-involving-public-companies2/
Delaware Bankruptcy Court Reins in Hold-Out Leverage http://www.mnat.com/blog/delaware-bankruptcy-court-reins-in-hold-out-leverage/ In a case of first impression, Chief Judge Brendan L. Shannon of the U.S. Bankruptcy Court for the District of Delaware ruled on Dec. 18, 2014, that Delaware corporate law’s “entire fairness” test, which is utilized to evaluate self-dealing transactions, is inapplicable to the Bankruptcy Code’s requirement that a plan be “proposed ... not by any means forbidden by law” under § 1129(a)(3) in connection with a consensual reorganization plan.

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2015-05-12 11:35:37 http://www.mnat.com/blog/delaware-bankruptcy-court-reins-in-hold-out-leverage/
Trust Decanting: Flexibility and Danger: Achieving Tax Benefits, Revising Fiduciary Powers, and Mitigating Trustee Liability http://www.mnat.com/blog/trust-decanting-flexibility-and-danger-achieving-tax-benefits-revising-fiduciary-powers-and-mitigating-trustee-liability/ On May 12, 2015, Strafford hosted a webinar on “Trust Decanting: Flexibility and Danger: Achieving Tax Benefits, Revising Fiduciary Powers, and Mitigating Trustee Liability.” Morris Nichols partner Todd A. Flubacher and co-faculty Meryl G. Finkelstein of Norton Rose Fulbright discussed benefits of decanting, common law and state decanting statutes, common pitfalls, and best practice strategies, and ethical considerations.

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2015-05-12 10:44:57 http://www.mnat.com/blog/trust-decanting-flexibility-and-danger-achieving-tax-benefits-revising-fiduciary-powers-and-mitigating-trustee-liability/
Delaware Court of Chancery Issues Significant Opinion on Corporate Creditors; Addresses Fiduciary Duties, Standing, and Measure of Insolvency http://www.mnat.com/blog/delaware-court-of-chancery-issues-significant-opinion-on-corporate-creditors-addresses-fiduciary-duties-standing-and-measure-of-insolvency/ In an opinion issued on May 4, 2015, Quadrant Structured Products Co., Ltd. v. Vertin, the Court of Chancery provided important guidance to distressed Delaware corporations and their creditors.  Among other things, the Court (i) summarized directors’ fiduciary duty to creditors, (ii) held that a creditor has standing to bring a derivative suit if the corporation is insolvent at the commencement of the suit, even if the corporation subsequently becomes solvent, and rejected an “irretrievably insolvent” element to establishing insolvency for standing purposes and (iii) discussed the measure of “assets” for purposes of determining solvency under the balance sheet test.

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2015-05-08 14:24:24 http://www.mnat.com/blog/delaware-court-of-chancery-issues-significant-opinion-on-corporate-creditors-addresses-fiduciary-duties-standing-and-measure-of-insolvency/
Master's Final Reports in Mennen v. Wilmington Trust http://www.mnat.com/blog/masters-final-reports-in-mennen-v-wilmington-trust/ Two Master’s Final Reports were issued in Mennen v. Wilmington Trust Company on April 24, 2015. As a courtesy to our clients and friends, below please find analysis of both reports.

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2015-05-07 14:45:55 http://www.mnat.com/blog/masters-final-reports-in-mennen-v-wilmington-trust/
CSC Delaware Seminar Series: Interview with Chancellor Bouchard http://www.mnat.com/blog/csc-delaware-seminar-series-interview-with-chancellor-bouchard/ On May 1, 2015, the Corporation Service Company hosted an exclusive conversation with Andre G. Bouchard, Chancellor, Delaware Court of Chancery.  Morris Nichols partner John P. DiTomo moderated the breakfast program which was developed jointly with the State of Delaware.

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2015-05-01 10:47:14 http://www.mnat.com/blog/csc-delaware-seminar-series-interview-with-chancellor-bouchard/
Court of Chancery Finds Committee Did Not Believe Dropdown Transaction Was in the Best Interests of MLP http://www.mnat.com/blog/court-of-chancery-finds-committee-did-not-believe-dropdown-transaction-was-in-the-best-interests-of-mlp/ On Apr. 20, 2015, the Court of Chancery issued its opinion after trial in the El Paso Pipeline Partners L.P. derivative litigation.  Plaintiffs challenged a “dropdown” transaction whereby the parent corporation (“Parent”) in a master limited partnership (“MLP”) structure sold interests in two of its subsidiaries to the limited partnership (“El Paso MLP”), and the Court found that the general partner, in engaging in the transaction with Parent, had violated the El Paso MLP limited partnership agreement.  The Court held that a committee of independent members of the general partner’s board (the “Committee”) who approved the transaction (i.e., giving “special approval” in the terminology of the limited partnership agreement) failed to form the requisite subjective belief that the dropdown transaction was in the best interests of El Paso MLP.  The opinion closely examined the Committee’s process and offers important lessons to conflicts committees and their advisors both as to the process and as to the appropriate factors that a committee should consider in approving or disapproving a dropdown transaction for an MLP. 

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2015-04-22 14:25:21 http://www.mnat.com/blog/court-of-chancery-finds-committee-did-not-believe-dropdown-transaction-was-in-the-best-interests-of-mlp/
Two Morris Nichols Attorneys Elected to Inaugural Class of American College of Governance Counsel Fellows http://www.mnat.com/news/two-morris-nichols-attorneys-elected-to-inaugural-class-of-american-college-of-governance-counsel-fellows/ 2015-04-21 00:00:00 http://www.mnat.com/news/two-morris-nichols-attorneys-elected-to-inaugural-class-of-american-college-of-governance-counsel-fellows/ Amendments to the DGCL Remove Obstacles to Adoption of Public Benefit Status http://www.mnat.com/blog/amendments-to-the-dgcl-remove-obstacles-to-adoption-of-public-benefit-status/ On April 2, 2015, the Corporation Law Council of the Delaware State Bar Association announced proposed amendments to the Delaware General Corporation Law which, if approved by the Executive Committee of the DSBA, will be proposed to the state legislature in the current session. Those amendments include important changes to Subchapter XV of Title 8, which governs public benefit corporations (‘‘PBCs’’). Subchapter XV was initially adopted in 2013. Since that adoption, 265 Delaware corporations have chosen to become PBCs.

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2015-04-17 11:46:28 http://www.mnat.com/blog/amendments-to-the-dgcl-remove-obstacles-to-adoption-of-public-benefit-status/
Lex Machina 2014 Patent Litigation Review: Morris Nichols Again Led Delaware and U.S. Firms in Patent Litigation Activity http://www.mnat.com/news/lex-machina-2014-patent-litigation-review-morris-nichols-again-led-delaware-and-u-s-firms-in-patent-litigation-activity/ 2015-03-27 00:00:00 http://www.mnat.com/news/lex-machina-2014-patent-litigation-review-morris-nichols-again-led-delaware-and-u-s-firms-in-patent-litigation-activity/ Kimberly Gill McKinnon Elected to American College of Trust and Estate Counsel http://www.mnat.com/news/kimberly-gill-mckinnon-elected-to-american-college-of-trust-and-estate-counsel/ 2015-03-20 12:12:19 http://www.mnat.com/news/kimberly-gill-mckinnon-elected-to-american-college-of-trust-and-estate-counsel/ Managing Intellectual Property Names Jack Blumenfeld Outstanding IP Litigator for Delaware http://www.mnat.com/news/managing-intellectual-property-names-jack-blumenfeld-outstanding-ip-litigator-for-delaware/ 2015-03-19 00:00:00 http://www.mnat.com/news/managing-intellectual-property-names-jack-blumenfeld-outstanding-ip-litigator-for-delaware/ John DiTomo Comments on Dole Chancery Opinion for Law360 http://www.mnat.com/news/john-ditomo-comments-on-dole-chancery-opinion-for-law360/ 2015-03-03 09:36:03 http://www.mnat.com/news/john-ditomo-comments-on-dole-chancery-opinion-for-law360/ 2015 Patents Expert Guide Recognizes Three Morris Nichols Partners http://www.mnat.com/news/2015-patents-expert-guide-recognizes-three-morris-nichols-partners/ 2015-03-01 00:00:00 http://www.mnat.com/news/2015-patents-expert-guide-recognizes-three-morris-nichols-partners/