Mark E. McDonald

Firm/Organization: Cleary Gottlieb Steen & Hamilton LLP

Blogs: Cleary M&A and Corporate Governance Watch

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Cleary M&A and Corporate Governance Watch

Not So Sweet: Delaware Supreme Court Revives Caremark Claim, Provides Guidance On Directors’ Oversight Duties

By James E. Langston, Mark E. McDonald & Philippa Ratzki on June 24, 2019

Last week, the Delaware Supreme Court reversed the Delaware Court of Chancery’s dismissal of a Caremark claim[1] that arose out of the Blue Bell ice cream listeria outbreak in the mid-2010s. See Marchand v. Barnhill, No. 533, 2018 (Del. June 18, 2019). The Delaware Supreme Court’s opinion in this closely watched case provides useful guidance to directors on the proper role of the board in overseeing risk management.…

Cleary M&A and Corporate Governance Watch

Delaware Supreme Court Provides Further Guidance on Timing Requirement Under MFW

By Roger A. Cooper, Rishi N. Zutshi, Mark E. McDonald & Kimberly Black on April 10, 2019

The Delaware Supreme Court issued a decision last week that further clarifies when MFW’s “dual protections” must be put in place in order to qualify the transaction for deferential business judgment review. See Olenik v. Lodzinski, No. 392, 2018 (Del. April 5, 2019). Under MFW, business judgment review applies to a merger proposed by a controlling stockholder conditioned “ab initio” on two procedural protections: (1) the approval of an independent, adequately-empowered special committee that…

Cleary M&A and Corporate Governance Watch

Target’s Termination of Merger Agreement Approved Based on Plain Contract Language

By Paul J. Shim, David I. Gelfand & Mark E. McDonald on March 18, 2019

Last week, the Delaware Court of Chancery found that a target company in an agreed merger properly terminated the merger agreement following the passage of the specified “end date” where the buyer failed to exercise its right under the agreement to extend the end date. See Vintage Rodeo Parent, LLC v. Rent-a-Center, Inc., C.A. No. 2018-0927-SG (Del. Ch. Mar. 14, 2019). The decision is a stark reminder that courts will enforce the terms of…

Cleary M&A and Corporate Governance Watch

Claim Against Target CEO Survives Dismissal, While Aiding and Abetting Claim Against Private Equity Buyer is Dismissed

By Meredith E. Kotler, Roger A. Cooper, Mark E. McDonald & April Collaku on December 13, 2018

In In re Xura, Inc. Stockholder Litigation,[1] decided earlier this week, the Delaware Court of Chancery denied the target CEO’s motion to dismiss claims that he breached his fiduciary duties by “steer[ing]” the company into an allegedly unfair acquisition by a private equity firm that promised to retain him post-acquisition, while knowing that his job was in jeopardy if the target remained independent. This case is yet another example of why disclosures are…

Cleary M&A and Corporate Governance Watch

Corwin Cleansing Denied For Company Sold During Restatement Process—Sound Familiar?

By Meredith E. Kotler, Roger A. Cooper, Mark E. McDonald & Kal Blassberger on November 27, 2018

The Delaware Court of Chancery recently denied Corwin cleansing[1] in a case involving the sale of a public company while it was engaged in a restatement of its prior audited financial statements. See In re Tangoe, Inc. S’holders Litig., C.A. No. 2017-0650-JRS (Del. Ch. Nov. 20, 2018). If this sounds familiar, that is because it is the second time in two years that the Court of Chancery has denied a motion to dismiss…

Cleary M&A and Corporate Governance Watch

Delaware Decision Provides Further Lessons for Directors, Activist Investors, and Financial Advisors in Negotiating Mergers

By Meredith E. Kotler, Roger A. Cooper, Mark E. McDonald & Kal Blassberger on October 17, 2018

The Delaware Court of Chancery yesterday found an activist investor aided and abetted a target board’s breaches of fiduciary duty, most significantly by concealing from the target board (and from the stockholders who were asked to tender into the transaction) material facts bearing on a potential conflict of interest between the activist investor and the target’s remaining stockholders. See In re PLX Technology Inc. S’holders Litig., C.A. No. 9880-VCL (Del. Ch. Oct. 16, 2018).…

Cleary M&A and Corporate Governance Watch

Lessons from the CBS-NAI Dispute: When (If Ever) Will the Court of Chancery Grant a TRO To Restrain a Controlling Stockholder From Taking Action to Prevent a Board From Diluting Its Voting Control?

By Meredith E. Kotler & Mark E. McDonald on October 15, 2018

This is the fourth in a series of posts discussing certain issues and lessons for practitioners arising out of the recently settled dispute between CBS and its controlling stockholder.[1] Relevant background can be found here and additional posts in this series can be found here. In the first week of the CBS-NAI litigation, the Court of Chancery denied CBS’s request for a temporary restraining order (“TRO”), which would have prevented NAI from…

Cleary M&A and Corporate Governance Watch

Akorn v. Fresenius: A MAC in Delaware

By David Leinwand, James E. Langston & Mark E. McDonald on October 11, 2018

Until Vice Chancellor Laster’s decision last week in Akorn Inc. v. Fresenius KABI AG,[1] no Delaware court had released an acquiror from its obligation to close a transaction as a result of the occurrence of a “Material Adverse Effect.”[2] The cases previously adjudicated in Delaware all had required the acquiror to close, often despite a significant diminishment in target value and, in some, the court criticized the acquiror for seeking to avoid…

Cleary M&A and Corporate Governance Watch

Delaware Court of Chancery Finds Fair Value in Appraisal Case To Be Unaffected Market Price

By Meredith E. Kotler, Mark E. McDonald & Vanessa C. Richardson on February 21, 2018

Last week, the Delaware Court of Chancery issued its first significant appraisal decision applying the Delaware Supreme Court’s recent Dell[1] and DFC[2] opinions, which we’ve previously discussed here and here. See Verition Partners Master Fund Ltd. v. Aruba Networks, Inc., C.A. No. 11448-VCL (“Aruba”). Although Dell and DFC both emphasized that deal price will often be the best evidence of fair value in appraisal actions involving open, competitive, and arm’s-length mergers…

Cleary M&A and Corporate Governance Watch

Delaware Supreme Court’s Dell Decision Further Reduces Appraisal Risks for Buyers

By Victor Lewkow, Meredith E. Kotler & Mark E. McDonald on December 18, 2017

Last week, the Delaware Supreme Court issued another highly anticipated appraisal decision, Dell, Inc. v. Magnetar Global Event Driven Master Fund Ltd. Dell builds on the Court’s DFC decision earlier this year in which the Court held that the merger price will generally be entitled to significant, if not dispositive, weight in an appraisal action involving the sale of a public company pursuant to an open, competitive, and arm’s-length bidding process, regardless of whether the buyer is…

Mark E. McDonald

Not So Sweet: Delaware Supreme Court Revives Caremark Claim, Provides Guidance On Directors’ Oversight Duties

Delaware Supreme Court Provides Further Guidance on Timing Requirement Under MFW

Target’s Termination of Merger Agreement Approved Based on Plain Contract Language

Claim Against Target CEO Survives Dismissal, While Aiding and Abetting Claim Against Private Equity Buyer is Dismissed

Corwin Cleansing Denied For Company Sold During Restatement Process—Sound Familiar?

Delaware Decision Provides Further Lessons for Directors, Activist Investors, and Financial Advisors in Negotiating Mergers

Lessons from the CBS-NAI Dispute: When (If Ever) Will the Court of Chancery Grant a TRO To Restrain a Controlling Stockholder From Taking Action to Prevent a Board From Diluting Its Voting Control?

Akorn v. Fresenius: A MAC in Delaware

Delaware Court of Chancery Finds Fair Value in Appraisal Case To Be Unaffected Market Price

Delaware Supreme Court’s Dell Decision Further Reduces Appraisal Risks for Buyers

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