In re Volcano Corp. Stockholder Litigation
Delaware Court of Chancery
143 A.3d 727 (2016)
Relevant factsFree
Volcano Corporation and Koninklijke Philips, N.V. agreed to a two-step merger; Philips made a tender offer to Volcano stockholders, and 89.1% of Volcano's outstanding shares were tendered, after which the merger closed. Former Volcano stockholders (plaintiffs) then sued Volcano's board (defendants), alleging the board breached its fiduciary duty in approving the merger, and sought to enjoin it; the board moved to dismiss.
IssueFree
Whether acceptance of a first-step tender offer by fully informed, disinterested, and uncoerced stockholders representing a majority of the corporation's outstanding stock irrebuttably invokes the business judgment rule for the transaction.