Wednesday, September 12, 2018
This morning the Delaware Supreme Court heard arguments in Flood v. Synutra International. The main issue in the case was the status of MFW's ab initio requirement - whether in a controlling shareholder take-private transaction - the ab initio requirement announced in M& F Worldwide is a brightline requirement or if it's something less than that. The two justices who were most active were Justice Valihura and Chief Justice Strine. Justice Valihura seems to like brightline rules. On the other hand, Chief Justice Strine does not appear to be a big fan of the ab initio requirement. Strine's reluctance to see a "foot fault" on the ab initio requirement as a major problem shouldn't come a big surprise. His Chancery Court opinion that formed the basis for the later Delaware Supreme Court case in M & F Worldwide included no such requirement.
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