The Wilmington, Delaware News Journal highlights ILR’s opposition to a proposed bill that would prohibit a private company from adopting bylaws requiring an investor who sues and loses to pay the company’s legal costs. The legislation is in direct response to a recent Delaware Supreme Court decision upholding such “fee-shifting” bylaws.
News Journal reporter, Jonathan Starkey, writes that ILR, “said the legislation would eliminate a tool to fight frivolous merger lawsuits that only serve to line the pockets of the plaintiffs’ trial bar at the expense of national and Delaware companies and their shareholders.”
He also highlights a letter sent by ILR this week to Delaware lawmakers urging them to reject the bill.
In that letter, ILR President Lisa A. Rickard writes, “A company’s shareholders suffer when one or both parties to a merger transaction are forced to expend millions of dollars defending suits in multiple courts and paying multiple attorneys’ fee awards in connection with settlements necessary to eliminate legal uncertainty and allow the transaction.”