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Contracts
When Your Non-Binding Term Sheet Creates An Enforceable Contract: Important Decision On The Duty To Negotiate In Good Faith
Term sheets are often used to facilitate the negotiation of a transaction. When a term sheet is used, there is a risk that one party may seek to treat the term sheet as an enforceable contract. A recent decision by the Delaware Supreme Court[1] highlights circumstances in which an agreement to...
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SEC Lifts Ban On General Solicitation For Certain Private Offerings, Disqualifies "Bad Actors" From Participating In Regulation D Private Offerings And Proposes Rules To Assist In Monitoring Market Practices
The Securities and Exchange Commission has adopted major amendments to the private placement safe harbor under Rule 506 of Regulation D and to Rule 144A under the Securities Act of 1933 (the “Securities Act”). The amendments will allow general advertising and general...
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SEC Proposes Changes To Money Market Funds
On June 5, 2013, the Securities and Exchange Commission (the “SEC”) proposed long-anticipated amendments to Rule 2a-7 and other rules under the Investment Company Act of 1940 (the “1940 Act”) and amendments to related disclosure requirements (the “Proposal”).[1...
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Delaware Supreme Court Issues Important Ruling Barring Re-Litigation Of Stockholder Derivative Suit Under Collateral Estoppel
In a short but significant opinion with potentially wide-ranging implications for stockholder derivative law, on April 4, 2013, the Delaware Supreme Court unanimously ruled that: (1) a prior dismissal of a stockholder derivative suit for failure to allege demand futility precluded different...
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Back To Basic: Proof Of Materiality Not Needed To Trigger The Fraud-On-The-Market Presumption Of Reliance
The United States Supreme Court held in Amgen v. Connecticut Retirement Plans & Trust Funds that investors need not prove materiality at the class certification stage to invoke the rebuttable presumption of reliance on public misrepresentations under Basic v. Levinson.[1] The 6-3 decision...
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“Well, Now I’m Screwed. I Can’t Sell.” The Words That Will Take The SEC’s Insider Trading Case Against Mark Cuban To Trial
Recently, in S.E.C. v. Cuban, No. 08-CV-2050, 2013 WL 791405 (N.D. Tex. March 5, 2013), a federal district court denied Mark Cuban’s motion for summary judgment. The court held that although the question was “in some respects a close one,” there was sufficient dispute over the...
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Pack Your Bags And Renew That Passport: Duties Of Independent Directors Of Delaware Corporations Having Significant Operations Or Assets Abroad
On February 6, 2013, Chancellor Strine of the Delaware Chancery Court issued a bench ruling addressing the duty of independent directors of a Delaware corporation with significant operations or assets outside the United States. In re Puda Coal, Inc. Stockholders Litigation, C.A. No. 6476-CS (Del...
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