The good news on the litigation front comes from Cornerstone, which reports that:
For the first time since 2009, the percentage of M&A deals valued over $100 million and challenged by shareholder litigation dropped below 90 percent in 2015 and so far in 2016, according to a new report released today by Cornerstone Research. The report, Shareholder Litigation Involving Acquisitions of Public Companies—Review of 2015 and 1H 2016 M&A Litigation, found that 64 percent of M&A deals faced litigation in the first six months of 2016. There were 47 M&A deals with associated lawsuits during the first half of the year.
Over the first three quarters of 2015, plaintiffs challenged mergers and acquisitions in the Delaware Court of Chancery 61 percent of the time. In the fourth quarter of 2015 and the first two quarters of 2016 combined, M&A-related litigation was filed in Delaware for only 26 percent of challenged deals.
Of course, Delaware could have made an even greater impact on reining in spurious litigation if they had not banned fee shifting bylaws. Yes. it still rankles. And, yes, I still think it was a mistake: See Bainbridge, Stephen M., Fee Shifting: Delaware's Self-Inflicted Wound (2015). 40 Delaware Journal of Corporate Law 851 (2016); UCLA School of Law, Law-Econ Research Paper No. 15-10. Available at SSRN: http://ssrn.com/abstract=2624750
