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Canadian M&A Law

Sunday, June 25, 2017 | Ideas and resources on the law of mergers & acquisitions

Category Archives: Directors’ Duties and Liabilities

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Breach of Loyalty in Run-Up to a Going Private Transaction Costs President and Controlling Shareholder nearly $150 million

Posted in Directors’ Duties and Liabilities, Shareholder Rights

In In re Dole Food Co., Inc. Stockholder Litigation, the Delaware Court of Chancery awarded $148,190,590 in damages against Dole’s controlling shareholder and President for breaching their duty of loyalty when conducting a going-private transaction. Though based on egregious …

Related Party Transactions: A Cautionary Note From the Delaware Court Of Chancery

Posted in Agreements / Drafting Issues, Directors’ Duties and Liabilities, Securities Law, Shareholder Rights

A recent Delaware Court of Chancery decision in In re El Paso Pipeline Partners, L.P. discusses the process surrounding related party transactions in a publicly-traded limited partnership. The Court’s opinion provides notable comments on the scope of the contractual duties …

Delaware Supreme Court Revisits Revlon Duties, clarifies meaning of “Market Check”

Posted in Agreements / Drafting Issues, Directors’ Duties and Liabilities, Marketplace Trends, Shareholder Rights

In C&J Energy Services, Inc. v. City of Miami General Employees’ and Sanitation Employees’ Retirement Trust, the Delaware Supreme Court reversed a ruling from the Chancery Court that had enjoined a shareholder vote on a merger for 30 days …

Delaware Decision Upholds Board Discretion In Implementing Rights Plan Against Activist Hedge Fund

Posted in Defensive Tactics, Directors’ Duties and Liabilities, Marketplace Trends

The Delaware Court of Chancery decision in Third Point highlights once again the breadth of the discretion of boards of directors when implementing defensive tactics subject to the Unocal standard. The decision is an illustration of the potential role of …

BCSC Allows Shareholder Rights Plan to Survive Almost 160 Days

Posted in Defensive Tactics, Directors’ Duties and Liabilities, Marketplace Trends, Securities Law, Shareholder Rights, Take-Over Bids / Tender Offers

On May 2, the British Columbia Securities Commission (BCSC) ruled on an application by HudBay Minerals Inc. to cease-trade Augusta Resource Corporation’s shareholder rights plan (the Pill).  While the BCSC panel granted an order cease-trading the Pill as at 5:00pm …

Activism Update: Ontario Court in Bioniche Clarifies Rights of Dissidents in Requisitioning a Contested Meeting

Posted in Directors’ Duties and Liabilities, Shareholder Rights

Mike Devereux and Zev Zelman, respectively of the Toronto and Montreal offices of Stikeman Elliott, look at a significant recent Ontario decision concerning dissident shareholders and requisitioned meetings.

The Ontario Superior Court of Justice recently issued its decision in …

Canadian Companies Easier Targets for Activist Investors than U.S. Companies

Posted in Directors’ Duties and Liabilities, Marketplace Trends, Proxy Fights, Securities Law, Shareholder Rights

Many features of the Canadian regulatory framework are friendly to shareholders and make it easier for activist investors to take action against management. Specifically, it is easier in Canada for shareholders to requisition meetings and nominate directors, the threshold for …

Controlled Auctions in Canada: Tactics and Legal Strategy

Posted in Competition / Foreign Investment, Controlled Auctions, Cross-Border M&A, Directors’ Duties and Liabilities, Marketplace Trends, Negotiated Transactions, Private Equity, Proxy Fights

Despite the uncertainty and volatility continuing to affect both the global economy and North American capital markets, controlled auction transactions in the Canadian marketplace remain remarkably active, especially in the mid-market. Before venturing into these tempting waters, sellers and buyers …

Journal Article Suggests Repeal of Defensive Tactics Policy

Posted in Defensive Tactics, Directors’ Duties and Liabilities, Securities Law, Shareholder Rights, Take-Over Bids / Tender Offers

Stikeman Elliott partners Sean Vanderpol and Ed Waitzer recently published an article in the Osgoode Hall Law Journal that questions the current emphasis on the primacy of shareholder choice in the case of take-over transactions under Canadian securities regulations. Entitled …

Delaware court won’t stop shareholder meeting to approve merger from going ahead, holding that disclosure issues cited were not material

Posted in Defensive Tactics, Directors’ Duties and Liabilities, Shareholder Rights, Take-Over Bids / Tender Offers

Unless unhappy shareholders make a really strong case, Delaware courts appear reluctant to issue injunctive relief against proposed transactions in a weak M&A market.

Wayne County Employees’ Retirement System v. Corti et al.
Court of Chancery (Delaware)
July 1, 2008 …

Alberta judge holds market valuation soundest basis for deciding fair value of dissenters’ shares; dissenters not permitted to take advantage of spike in market price after first stage of two-step transaction

Posted in Directors’ Duties and Liabilities, Shareholder Rights, Take-Over Bids / Tender Offers

Also rejects dissenters’ claim for far higher valuation based on future possibilities, even though some of these had been touted by company in its marketing efforts
Deer Creek Energy Ltd. v. Paulson & Co., Inc.
Court of Queen’s Bench (Alberta)…