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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