Retaining the Attorney-Client Privilege in a Merger
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Retaining the Attorney-Client Privilege in a Merger (MLC641J)
Would the Reaffirmed Declaration by Delaware Court regarding Attorney-client Privileges in Mergers pose Unexpected Consequences?
In Great Hill Equity Partners IV, LP v. SIG Growth Equity Fund I, LLLP, Chancellor Strine of the Delaware Chancery Court reaffirmed the fact that the target company in Delaware merger is the sole holder of attorney-client privilege to communication with its counsel. He also said that the privilege cannot be claimed by the seller (the target’s shareholder). The Great Hill case involved a buyer who filed suit for fraudulent inducement by the seller that followed the consummation of the buyer’s merger with a company owned by the seller. This was because the buyer found troubling communications between the seller and counsel for the company about the merger on the company’s computers. Upon the closing of the merger, the court expressly held that the attorney-client privilege rests with the surviving corporation owned by the buyer and the seller retains no rights or access to the target’s privileged pre-closing communications.
This case will have far-reaching and unexpected consequences for parties to a merger. Hear out expert speaker Christopher Pesch on the whole case in this audio-seminar.
Christopher Pesch is a Partner with BakerHostetler in Chicago. He primarily focuses on corporate transactional and securities work. Mr. Pesch takes a strong interest in his clients and their businesses, working with them to develop solutions to serve their business expectations and ...
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