Mergers & Acquisitions Law Report Index-Summary

S CORPORATIONS

– Built-in gains, successor firm in merger liable where shareholders agreed to indemnify purchaser for pre-closing costs (CCA), 1186

SARBANES-OXLEY ACT

– Small business audit exemption, SEC urged not to oppose permanent extension, 474

SECURITIES

– Allocation of consideration between preferred and common stock, preliminary injunction denied (Del. Ch.), 286
– Concealment of merger plans from unsuccessful bidder, nonmisleading omission not actionable (D. Minn.), 422
– Consolidated returns, intercompany transactions, Final Regs. may be issued before Temp. Regs. expire, 286
– Convertible debt securities, acquisition by nonpublic acquirer does not trigger conversion under N.Y. law (2d Cir.), 197
– Delayed registration, private equity firm lacks standing to bring breach of contract claim (Del.), 166
– Jurisdiction, ownership in Del. firm insufficient to exercise over stock transfer dispute (Del. Ch.), 353
– McKesson former executive sentenced for cooking the books (N.D. Cal.), 397
– Registration, company reorganizing to holding company structure may use reporting under 1934 Act to determine relief under 1933 Act (SEC), 1079
– Reporting requirements, IPO issuer abandoning offer or being acquired by other entity eligible for Rule 12h-3 relief (SEC), 261
– Stock drop litigation

See PENSIONS

– Stock for debt swap, SEC considers excess as contribution to capital, 1142
– Stock options

See STOCK OPTIONS

– Stock prices, shareholders place positive value on SEC access rules, 1142
– Stock redemption under contract agreement followed by acquisition resulting in higher price subject not breach of fiduciary duty (Del.), 334
– Stock valuation

See VALUATION

– Switzerland, violation of disclosure law nets record fine, 132
– Tender offers

– – Attorneys' fees rejected for lack of causal connection to price increase (Del.), 76
– – Cox Radio/Cox Media Group merger, breach of fiduciary duty claims settled, attorneys' fee request slashed (Del. Ch.), 471
– – Stock for notes exchange granted relief from restrictions (SEC), 473

– Worthless stock deduction

See REORGANIZATIONS

SECURITIES FRAUD

See also INSIDER TRADING
– Bank of Am./Merrill Lynch merger, N.Y. Comptroller files charges (S.D.N.Y.), 693; impact of National Securities Markets Improvement Act, analysis, 703
– Class actions

See CLASS ACTIONS

– Confidential witness may be deposed (2d Cir.), 397
– Convertible note in asset purchase deal not security (E.D.N.Y.), 148
– Countrywide Financial, failure to plead why statements were fraudulent (S.D.N.Y.), 603
– Disclosure

– – Failure to reveal merger talks (2d Cir.), 354
– – Sears/Kmart merger, investors' claims of failure to disclose negotiations (N.D. Ill.), 12

– Fiduciary duty claims fueling lawsuits, 959
– Financial records falsification, failure to show loss causation (5th Cir.), 222; (U.S., rev sought), 1142
– Level 3 Communications, misstatement of merged company integration, class action dismissed for lack of scienter (D. Colo.), 1179
– Merger agreement precludes reliance on pre-merger representations (2d Cir.), 601
– MGI Pharma/Guilford Pharmaceuticals merger, investment banker, friend, and tippee charged (S.D.N.Y.), 288
– Natural gas company projections not guarantee of future performance (5th Cir.), 660
– Pension fund fails to adequately plead scienter over flawed accounting treatment of acquisition (E.D. Wis.), 337
– Porsche takeover of VW, hedge fund alleges violation of securities laws (S.D.N.Y.), 103
– Prospectus misrepresentations

– – Archer/Tishman merger, 1933 Act protects only purchasers (D. Colo.), 761
– – Loss causation lacking (9th Cir.), 760

– RICO, METCO exchange of mining claims for stock, diminution of stock value claim lack standing (10th Cir.), 200
– Securities Exchange Act limited to U.S. traded securities (U.S., aff), 624
– Settlement numbers up, 476
– Stiefel Labs, stock plan, failure to disclose merger talks, dismissal denied (S.D. Fla.), 55; dismissal denied for second time, 552
– Terra Firma tortious interference and misrepresentation claims against Citigroup to proceed (S.D.N.Y.), 854; jury finds no wrongdoing, 1029
– United Rentals/RAM Holding merger, misrepresentation that deal to proceed on original terms, dismissal for lack of intent to defraud (2d Cir.), 827
– Vivendi guilty of overstatement of financial position to shareholders (S.D.N.Y.), 126

SETTLEMENTS

– Antitrust

See ANTITRUST

– Banking, Bank of Am./Merrill Lynch merger

See BANKING

– Convertible debentures, bondholders not entitled to post-merger consideration from settlement (5th Cir.), 827
– Insider trading

See INSIDER TRADING

– Merck/Schering-Plough merger, shareholder class action settled with no compensatory award (D.N.J.), 314
– Philadelphia Stock Exchange, release settling state claims precludes federal claims (3d Cir.), 789
– PNC Financial/National City Corp. merger, settlement of fiduciary breach claims by additional disclosures affirmed (Del.), 421
– Securities fraud numbers up, 476
– Targus acquisition of Roundhouse, agreement needing further documents not precluded from being binding agreement (Mass. App. Ct.), 259
– Taxation

– – General Mills settles IRS claims over sale losses from sale of noncontrolling interest in subsidiary, 1036
– – Stock diminution claim, payment for stock not deductible (Or. T.C.), 1035

SEVERANCE PAY

– Golden parachutes

See GOLDEN PARACHUTES

SEX DISCRIMINATION

– Bank of Am./Merrill Lynch merger, Merrill Lynch employee retention plan sex bias claims fails to meet pleading standards (S.D.N.Y.), 401
– Successor liability, MacMillan test not sole determining factor (8th Cir.), 940

SHAREHOLDERS

– 3M/Cogent merger, shareholder action to halt tender offer denied (Del. Ch.), 958
– Cox Radio/Cox Media Group merger, tender offer and short form merger, breach of fiduciary duty claim settled (Del. Ch.), 471
– Loans, shareholder/board member of insolvent company not liable (7th Cir.), 737
– Minority shareholders

– – CONSOL Energy freeze-out of CNX shareholders, interlocutory review of fairness standard (Del.), 656
– – Craigslist majority shareholders' poison pill and dilution of minority shareholder stock deemed breach (Del. Ch.), 852
– – Direct fiduciary breach claims against other owners not permitted (Fla. Dist. Ct. App.), 32
– – Freeze-out, appraisal sole remedy (Wash.), 715
– – LLC merger with controlling unitholder, breach of duty claims to proceed (Del. Ch.), 1047
– – Pending merger discussions, failure to disclose claims reinstated (5th Cir.), 219
– – Short-form mergers

– – – Appraisal as sole remedy in dispute over valuation (U.S. rev den), 197
– – – Convertible shares, issuance by troubled firm to obtain financing reasonable (Del. Ch.), 420
– – – Freeze-outs, preliminary injunction denied (Del. Ch.), 521

– Proxies

See PROXIES

– Representative has standing to pursue breach of merger agreement (Del. Ch. Ct.), 420
– Revlon duties

See FIDUCIARY DUTY

– Right of first refusal, stockholder trying to sell to third parties violated fiduciary duty (Cal. Ct. App.), 51
– Stock split invalidity entitles initial shareholders to elect new directors (Del. Ch.), 1076
– Takeover defenses, shareholder rights/poison pill plans

– – Barnes & Noble plan upheld (Del. Ch.), 785; appealed (Del.), 853
– – Craigslist majority shareholders' poison pill and dilution of minority shareholder stock deemed breach (Del. Ch.), 852
– – Hostile takeovers, increase to spur resurgence of plans, 937
– – Potash//BHP Billiton merger

– – – Billiton seeks to nullify shareholder rights plan (Saskatchewan Fin. Serv. Comm.), 937
– – – Potash seeks to enjoin hostile takeover (E.D. Ill.), 871

– – Selectica plan designed to prevent loss of NOLs upheld (Del. Ch.), 243; affects discussed, 251; oral arguments set (Del), 601; oral arg. (Del.), 657; poison pill with low trigger upheld, 915; analysis, 947

SHIPPING

– Maritime safety and security systems, EADS and ATLAS Elektronik joint venture cleared, 1012
– Oil and gas pumping vessels, Baker Hughes/BJ Services merger approved subject to divestiture (D.D.C.), 395
– Shipyards, Northrop Grumman rejects bids for closing Avondale facility, 767

SOFTWARE

See TECHNOLOGY INDUSTRY

SOLVENIA

– Banking bailout support program extended, 630

SPAIN

– Bank bailouts, recapitalization plan approved by EC, 132
– Corporate exit tax, EU challenges unrealized capital tax, 1161

SPIN-OFFS

See REORGANIZATIONS, subheading: (D) reorganizations

SPORTS

– Oakley/Luxottica Group merger, attorneys' fees, minor changes fail to meet substantial benefit requirement (Cal. Ct. App.), 77

STANDING

– Derivative actions

– – Bank of Am. and Merrill Lynch merger, target pre-merger shareholders standing as post-merger shareholders (Del.), 825
– – LLC creditors of insolvent firm lack (Del. Ch.), 1027

– Securities fraud, RICO claims against METCO for diminution of stock value lack (10th Cir.), 200
– Shareholder representative has to pursue breach of merger agreement (Del. Ch. Ct.), 420
– Sirius XM Radio, inflated royalties, subscribers' state law class action to proceed (S.D.N.Y.), 1071
– Stock registration delay, private equity firm lacks to bring breach of contract claim (Del.), 166
– Successor liability, Commerce Clause challenge to state law limiting liability not barred by zone of interest analysis (Pa.), 1150
– Tax abatement, payment of tax on behalf of subsidiary sufficient (N.H.), 963

STATE AND LOCAL LAWS

– Ariz., renewal of judgment, registration issues certified to state supreme court (9th Cir.), 396
– Calif. to fine PacifiCare for health claims processing violations, 906
– Conn., motor fuels, disclosure of federally filed market concentration data required, 599
– Ill. eases filing requirements, 857
– N.Y., convertible debt securities, acquisition by nonpublic acquirer does not trigger conversion (2d Cir.), 197
– Pa., Commerce Clause challenge to state law limiting successor liability not barred by zone of interest analysis (Pa.), 1150
– Sirius XM Radio, inflated royalties, subscribers' state law class action to proceed (S.D.N.Y.), 1071
– Tenn. merger notification requirements apply to subsidiary mergers, 387

STATE AND LOCAL TAXES

– Ala., §338(h)(10) election, nonresident taxable on gain from sale of S corporation (Ala. Civ. App.), 130
– California

– – Comcast challenges tax assessment on breakup fees, unitary status with majority owned business interest, 301
– – NOLs, disallowance extended, 1157

– Colo., NOL carryforwards capped, 1088
– Idaho, reorganizations, return filing procedure revised, NOL carryover rules codified, 270
– Ind., consolidated returns, out-of-state company with instate integrated subsidiaries, 609
– La., parent entitled to NOLs of subsidiary following §338(h)(10) election (La. Ct. App.), 1035
– Massachusetts

– – International Data Group transfer of licensing business to nonviable tax entity deemed sham (Mass. App. Ct.), 1156
– – Investment tax credit, tax-free liquidation and merger of wholly owned subsidiary into parent not asset disposition, 1122

– New Hampshire

– – Like-kind exchanges, disregarded entity use, 718
– – Tax abatement claim, payment of tax on behalf of subsidiary sufficient for standing (N.H.), 963

– New York

– – Contract for purchase and sale of assets, money transfer not requirement to impose sales tax on bulk sale (N.Y. Div. Tax. App.), 983
– – Dividends paid as result of forced divestiture not subject to excess dividends tax (N.Y. Tax App. Trib.), 380
– – Sales and use tax, payment by bulk sale purchaser of business assets (N.Y. Div. Tax. App.), 610

– Ore.

– – Gain on sale of stock subject to apportionment (Or. Tax. Ct.), 809
– – Settlement of stock diminution claim, payment for stock not deductible (Or. T.C.), 1035

STATUTES OF LIMITATIONS

– ERISA stock drop litigation, 6 year period applied to Waste Management employee claims (D.D.C.), 605; class action certified, 1081
– NOLs, assessment relating to carrybacks, IRS clarification (PMTA), 1156

STEEL

See METALS
– EU merger approvals

See EU MERGER APPROVAL

STOCK

See SECURITIES

STOCK MARKETS

– Insider trading, Wall Street professionals indicted (S.D.N.Y.), 104
– NASD and NYSE Regulation merger, sealed court records, news groups seeking to unseal, hearing set (S.D.N.Y.), 13; request denied, 170; claims dismissed, absolute immunity cited, 221; appealed (2d Cir.), 261
– N.Y. Bd. of Trade/Intercontinental Exchange merger, stock or cash election period, no breach of good faith or fair dealing (Del. Ch.), 101
– Philadelphia Stock Exchange, release settling state claims precludes federal claims (3d Cir.), 789
– SEC proxy rules, shareholders place positive value on access, 1142

STOCK OPTIONS

– (F) reorganizations, foreign subsidiary's reimbursement of U.S. parent for stock options qualifies (PLR), 361
– Proxy misrepresentation, year delay in challenging bars equitable remedy (9th Cir.), 147
– Subsidiary reimbursement of parent for parent stock delivered to employees not §301 distribution (PLR), 361

STOCK PURCHASES TREATED AS ASSET ACQUISITIONS

– Foreign tax credit denial to covered asset acquisitions, legislative proposal, 612
– State and local taxes

See STATE AND LOCAL TAXES

SUCCESSOR BUSINESSES

– Asbestos tort claims

– – Retroactive limit on liability violates state constitution (Tex.), 1031
– – Standing, Commerce Clause challenge to state law limiting liability not barred by zone of interest analysis (Pa.), 1150

– Bankruptcy, tort claim does not follow assets to purchaser (2d Cir.), 120
– Collective bargaining

– – Arbitration not required of firm lacking continuity of workforce (2d Cir.), 553
– – Box manufacturers controlled by same person liable for pension contributions (6th Cir.), 830
– – Union recognition, unions and employers file amicus briefs on incumbent recognition (NLRB), 1082

– Environmental pollution

See ENVIRONMENT

– Export violation avoidance, planning considerations, 994
– FCPA risks in cross-border deals, 263
– Misstatement of post-reorganization assets, Kmart Holding shareholders' claims dismissed (2d Cir.), 336
– ObTape litigation, liability may follow merger (N.D. Ga.), 873
– Pension plans, stock drop litigation

– – Wachovia §401(k) plan participants' class action dismissed (W.D.N.C.), 764
– – WaMu employees bid for final judgment against dismissal of Morgan Chase denied (W.D. Wash.), 81

– Piercing the corporate veil, OSHA violations, repeated citations and penalties against predecessor justify (OSHRC), 1153
– Product liability, medical devices, preacquisition claims (8th Cir.), 871
– Sexual harassment, MacMillan test not sole determining factor (8th Cir.), 940
– Whirlpool/Maytag merger, vesting issue headed to trial (S.D. Iowa), 1055
– Withdrawal liability

See WITHDRAWAL LIABILITY

SUPERMARKETS

See GROCERS

SUPREME COURT, U.S.

– Cap Gemini acquisition of Ernst & Young, taxation of stock distribution (rev. sought), 832
– Fiduciary duty, affirmative duty to disclose right to change plan benefits (rev den), 202
– Securities fraud, 1934 Securities Act limited to U.S. traded securities (aff), 624
– Securities fraud class action, financial records falsification, failure to show loss causation (rev sought), 1142
– Short-form mergers, appraisal as sole remedy in dispute over valuation (rev den), 197
– Withdrawal liability calculation, contribution history taken into consideration (rev den), 290

SWAPS

See HEDGES

SWEDEN

– Saab

See MOTOR VEHICLES

SWITZERLAND

– Banking, “too big to fail,” restrictions rejected, special taxes considered, 385