Applying the Entire Fairness Standard, Buyer and its Affiliated
Directors Held Liable for $1.263 Billion
Sale Transaction Not Enjoined Even Though Customary Value
Enhancement Procedures Not Followed
In the past month, the Delaware Court of Chancery issued two
decisions providing important guidance on directors' duties in
connection with M&A transactions.
In re Southern Peru S'holder Deriv.
Litig.
On October 14, 2011, following a trial on the merits, Chancellor
Leo E. Strine, Jr. issued his post-trial decision in the
shareholder derivative action in In re Southern Peru
Shareholder Derivative Litigation, C.A. No. 961-CS. Chancellor
Strine awarded $1.263 billion plus interest in
damages against the acquiror, Grupo Mexico, S.A.B. de C.V.
("Grupo Mexico"). Grupo Mexico was the controlling
stockholder of a NYSE-listed company, Southern Peru Copper
Corporation ("Southern Peru"). The individual
directors affiliated with Grupo Mexico who served on the Southern
Peru
