What Are Directors’ Fiduciary Duties When Selling Control of a Corporation?

In Delaware, courts impose the so-called Revlon duty, which can be described as the fiduciary duty to make reasonable efforts to obtain the highest sales price reasonably possible in view of the market for the company. This may even involve conducting a public auction for the company or at least a check of the market, depending on the circumstances, and agreements must include a so-called “fiduciary out” to allow the directors to accept a higher bid after the agreement has been signed by a would-be buyer. See Revlon Inc. v MacAndrews & Forbes Holdings, Inc. (Del 1985) 506 A2d 173; Omnicare, Inc. v NCS Healthcare, Inc. (Del 2003) 818 A2d 914. But, as Keith Paul Bishop notes in his recent blog post on California Corporate and Securities Law, “[d]espite its notoriety in Delaware, Revlon is nearly unknown in California jurisprudence.” Continue reading

What IP Attorneys Need to Know About M&A Agreements

Although federal and state corporation, securities, antitrust, and tax laws governing mergers and acquisitions (M&A) are complex and nuanced, and the structure of a given transaction is usually driven by tax and securities considerations that aren’t within intellectual property counsel’s control, it’s useful for intellectual property lawyers to know the basic structures of these deals and the impact on the intellectual property provisions in the agreement. Here’s a crash course on basic types of M&A agreements. Continue reading

Get Intellectual Property Counsel in on Your M&A Deal

Despite Zuckerman’s decision to go it alone on the Instagram deal, intellectual property counsel play an increasingly important role in mergers and acquisitions (M&A). M&A used to be the domain of corporate lawyers, and corporate lawyers still typically lead M&A transaction teams, but it’s now common to see intellectual property counsel from both sides working as part of the team to draft and negotiate the intellectual property aspects of the agreement. That is as it should be. Continue reading

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