By William Mills

Partner | Corporate

By Emily Dworkin

Associate | Corporate

Following other recent decisions addressing the applicability and scope of Kahn v. M&F Worldwide Corp. (“MFW”), including In re Match Group Inc., Derivative Litigation and Tornetta v. Musk, on May 1, 2024, the Delaware Supreme Court in City of Sarasota Firefighters' Pension Fund et al. v. Inovalon Holdings, Inc. held that Inovalon Holdings, Inc., its CEO and its board of directors failed to comply with MFW’s fully informed stockholder vote requirement and therefore could not avail themselves of business judgment rule protection. 

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By Jodi Avergun

Senior Counsel | White Collar Defense and Investigations

By Edward Ernst

Associate | Corporate

On May 13, 2024, President Biden, acting on a transaction referred to him from the Committee on Foreign Investment in the United States (“CFIUS”), took the unusual step of ordering the prohibition of a real estate acquisition two years after it closed (the “Order”).  The Order requires a relatively rapid sale of the land to a third-party, among other interim obligations.  This transaction and the resulting presidential action is another indication of the U.S. government’s scrutiny of foreign investment in both U.S. real estate and U.S. business.  Moreover, it offers a case study for transaction parties on the need to carefully consider the pros and cons of making a voluntary disclosure to CFIUS prior to entering into binding documentation with respect to, or closing, cross-border transactions.

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By Peter Bariso

Special Counsel | Corporate

By Benjamin Hughes

Associate | Corporate

On April 30, 2024, in Himawan, et al. v. Cephalon, Inc., et al., the Delaware Court of Chancery held that the defendant acquiror complied with its contractual obligations to use commercially reasonable efforts to achieve certain milestones under the “earn-out” provision of the merger agreement.

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By Linda Swartz

Partner | Tax

By Andrew Carlon

Partner | Tax

On May 1, 2024, the IRS released Revenue Procedure 2024-24, which sets forth new requirements for requests for private letter rulings (PLRs) on corporate spin-off and split-off transactions.  (Both spin-offs (transactions in which a corporation (“Remainco”) distributes stock of a subsidiary (“Spinco”) to its shareholders as a dividend in kind) and split-offs (transactions in which the stock of the subsidiary is exchanged for outstanding Remainco stock) are generally subject to the same tax rules, and this article refers to both types of transactions as spin-offs.) This month’s long-anticipated Revenue Procedure represents the first systematic guidance on spin-off and split-off transactions since the IRS’s release of Revenue Procedure 2017-52 and reaffirms the IRS’s stated intention, first announced in the 2017 Revenue Procedure as a pilot program, to provide comprehensive rulings that address as many legal aspects of a spin-off transaction as possible.

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