Author: Scott Ofrias

As the Battle over the Universata Acquisition Rages, the Chancery Court Finds that the Appropriate Standard of Review Regarding Actions of a Stockholders’ Representative is “Subjective Good Faith”

By: Gregory R. Youman and Scott G. Ofrias

As the battle over the acquisition of equity in Universata, Inc. continues, the Court of Chancery, in Houseman v. Sagerman, C.A. No. 8897-VCG (Del. Ch. July 20, 2021), resolved two general exceptions asserted by Plaintiffs to the Special Master’s Final Report (“Final Report”).  In doing so, the Court decided that an escrow fund was properly created pursuant to the Merger Agreement, and further held that the appropriate standard of review regarding actions of the Stockholders’ Representative is “subjective good faith.”  However, the ultimate resolution of all the exceptions awaits further briefing by the parties.

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