Kaan Ekiner and Mark Felger, writing in the Delaware Business Court Insider, discuss a recent Delaware Court of Chancery decision dismissing fiduciary duty claims against directors and officers based on their alleged approval of a self-tender involving a controlling stockholder. The basis for plaintiffs’ claims were that the directors and officers had “unauthorized communications” with the controller and inhibited a special transaction committee from maximizing value on behalf of stockholders at the benefit of the controller. Key to the court’s decision was the absence of factual allegations that the individual defendants interfered with the special transaction committee’s functions or that they withheld any information about their engagement with the controller from the committee or the company’s board of directors.
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