In re IBP, Inc. Shareholders Litigation

Tyson Foods (defendant) aggressively pursued a merger with IBP (plaintiff), agreeing to pay IBP shareholders $30 per share in cash or stock — a price Tyson's own investment banker approved as fair — despite learning during negotiations of a $30 million accounting-fraud scandal at an IBP subsidiary and IBP's slumping business and unreliable earnings projections. After signing and announcing the deal, Tyson and IBP both suffered financially from an unusually harsh winter, and Tyson began slow-walking and ultimately terminated the agreement, suing IBP for fraudulent inducement; IBP sought specific performance instead.