The Delaware Court of Chancery refused to dismiss breach of fiduciary duty claims brought against directors of a target company in connection with a merger transaction. The court found that 3 of the target company's 7 directors were interested in the merger transaction. The other 4 directors were faulted by the court for engaging in an unnecessarily expedited sales process. In particular, the board agreed to a two-week market check period and did not perform any analysis regarding alternatives to the merger. The expedited sales process was driven by the desire of the 3 interested directors to complete the merger before the target company reported improved financial results.
In re Answers Corp. Shareholders Litig., (C.A. No. 6170-VCN) (Del. Ch. Apr. 11, 2012).