Indemnification is a key component in virtually every M&A deal, serving as a detailed and nuanced contractual risk allocation device between the Buyer and Seller. Though drafted in a two-way fashion, indemnity operates in the...more
Image a home buyer finally finds their dream house. There’s just one problem. During their home inspection, they discover the foundation is cracked. But they buy the house anyway, fully aware of the issues with the...more
In the 19th century, “ruffians roamed the streets” and robbed “unsuspecting victims” using a tactic knowing as “sandbagging”: They wielded “ostensibly harmless socks” that were in fact “filled with sand and used as weapons.” ...more
In an opinion of significance to M&A Practitioners, the Delaware Court of Chancery recently made it clear that Delaware law allows a buyer in an acquisition to “sandbag” a seller if the acquisition agreement allows for...more
On March 9, 2022, the Delaware Court of Chancery issued a post-trial decision in Arwood v. AW Site Services, LLC, subsequently amended on March 24, 2022. The plaintiff, John Arwood, had spent decades building a waste...more
It’s a situation that, at least theoretically, could happen many times every business day, all across the country, given how often businesses choose to have Delaware law apply to their contracts. A party (the seller or...more
There is perhaps no more consistently vexing problem for transactional attorneys on opposite sides than figuring out a fair contractual resolution for “sandbagging” issues....more
On October 1, in Akorn v. Fresenius Kabi, the Delaware Court of Chancery for the first time found that a material adverse effect — or MAE — had occurred in a merger transaction, which, combined with other breaches of the...more
Merger and purchase agreements involving Maryland corporations and REITs may be governed by Maryland law. For lawyers accustomed to agreements governed by Delaware or New York law, we are frequently asked to describe key...more