The Delaware Court of Chancery, in In re Terraform Power, Inc. Stockholders Litigation, C.A. No. 2019-0757-SG (consol.), memo. op. (Del. Ch. Oct. 30, 2020), found former stockholders who asserted purportedly dual-natured claims challenging a dilutive stock issuance under John A. Gentile, et al. v. Pasquale David Rossette, et al., No. 573, 2005, opinion (Del. Aug. 17, 2006), retained standing following a merger that extinguished plaintiffs’ derivative standing, rejecting the argument that recent precedent has rendered Gentile non-controlling.
NEW: Morris James discusses the decision in Chancery Reaffirms Narrowed Application of Gentile.
Shearman & Sterling discuss the decision in Delaware Court of Chancery Holds That Former Stockholders Can Pursue Direct Claims for Breach of Fiduciary Duty Arising From Issuance of Shares to Controlling Stockholder for Allegedly Insufficient Consideration.
$$$ Law360 discusses the decision in Chancery Moves Suit Over $650M Terraform Deal Toward Trial.