Is the frivolous M&A litigation party winding down?

In 2013, 97.5 percent of public M&A deals worth more than $100 million were sued an average of seven times each

When a public company announces that it is being acquired, no one is surprised anymore when suits are filed against that company's directors. Whether the price is good or great doesn't seem to matter. In 2013, 97.5 percent of public M&A deals worth more than $100 million were sued an average of seven times each.

To be sure, there are instances of what may have been true M&A misbehavior that harmed shareholders. Certainly that was the conclusion when the Delaware Court of Chancery awarded a $1.2 billion judgment (and $300 million plaintiffs’ attorney fee award) in the class action lawsuit over Grupo México, S.A.B. de C.V's acquisition of Southern Peru Copper.

Priya Cherian Huskins

Priya Cherian Huskins, Esq., is senior vice president of Woodfruff, Sawyer and Company. She can be reached at phuskins@wsandco.com.

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