• Lee v. Pincus: Delaware Chancery Court Declines to Dismiss Fiduciary Duty Claims Against Board for Post-IPO Waiver of Lock-Up Restrictions But Dismisses Aiding and Abetting Claims Against Underwriters for Consenting to the Waiver
  • December 18, 2014 | Authors: Francis J. Aquila; Audra D. Cohen; H. Rodgin Cohen; Mitchell S. Eitel; Brian T. Frawley
  • Law Firm: Sullivan & Cromwell LLP - New York Office
  • In an opinion issued on November 14, 2014, the Delaware Court of Chancery (C Bouchard) declined to dismiss breach of fiduciary duty claims against the directors of Zynga Inc. (“Zynga”) for waiving post-IPO lock-up restrictions in a manner that permitted certain stockholders, including half the members of the board, to sell some of their stock in a secondary offering two months before the lock-ups agreed at the time of the IPO would have expired, while extending the lock-up period applicable to other shares they owned. Other stockholders remained subject to the original lock-up timing.