Delaware Rundown: What You Missed In Q3

Delaware companies that take the proper precautions before beginning deal negotiations are protected by the business judgment rule, according to Morrison & Foerster partner James J. Beha II in the Law360 article “Delaware Rundown: What You Missed In Q3.” The Delaware Chancery Court reinforced that opinion when it rejected an Earthstone Energy shareholder’s challenge to the company's acquisition of Bold Energy.

"It's a recognition of the reality that there is going to be some level of discussion before the special committee is formed. But so long as the special committee is formed at the time formal negotiations are beginning and the special committee has control over the process, that's what matters in getting the business judgment rule," he said.