Series of Avoidable Missteps by an Activist Stockholder and the Target Board Led the Court of Chancery to Find Fiduciary Breaches and Stockholder Aiding and Abetting in Connection With the Sale of a Company--PLX Technology

Avago Technologies Wireless (USA) Manufacturing Inc. acquired PLX Technologies, Inc. for $6.50 per share in cash. After the $300 million merger closed, certain former PLX stockholders sued for damages, alleging that the PLX directors had breached their fiduciary breaches, aided and abetted by both Potomac Capital Partners II, L.P. (a hedge fund that is an activist stockholder and had three designees on the PLX board) and the PLX board’s financial advisor (the “Banker”).

Filed under:
USA, Delaware, Banking, Company & Commercial, Corporate Finance/M&A, Insolvency & Restructuring, Litigation, Fried Frank Harris Shriver & Jacobson LLP, Shareholder, Fiduciary, Judicial review, Non-disclosure agreement, Court of Chancery, Delaware Court of Chancery
Authors:
Gail Weinstein , Philip Richter , Steven Epstein , Steven J. Steinman , Christopher Ewan , Steven G. Scheinfeld , Robert C. Schwenkel , Scott B. Luftglass , Peter L. Simmons , Andrew J. Colosimo , Andrea Gede-Lange , Randi Lally , Mark H. Lucas , Brian T. Mangino , Brian Miner , David L. Shaw , Matthew V. Soran , David J. Greenwald , Arthur Fleischer Jr.
Location:
USA
Firm:
Fried Frank Harris Shriver & Jacobson LLP