• Delaware Supreme Court Reverses Lyondell Decision; Enters Judgment For Director Defendants
  • April 15, 2009 | Authors: James R. Griffin; Steven Schaefer; Joshua P. Agrons
  • Law Firms: Fulbright & Jaworski L.L.P. - Dallas Office ; Fulbright & Jaworski L.L.P. - Houston Office
  • On March 25, 2009, the Delaware Supreme Court issued its highly anticipated opinion in Lyondell Chemical Corp. v. Ryan,[1] expressly rejecting stockholder claims that independent directors violated their duty of loyalty by failing to act in good faith in selling the company. In reaching its decision, the Delaware Supreme Court also reaffirmed that the principles of Revlon [2] give directors wide flexibility in their pursuit to obtain the best price for the sale of a company. In the context of these types of claims, where plaintiffs allege that directors breach their duty of loyalty by failing to attend to their duties in good faith in the sale of the company, this decision should provide additional comfort to directors of Delaware companies in carrying out their obligations to the stockholders of the companies they serve.