Testing Poison Pill Tolerance In Del.

Law360, New York (October 6, 2010, 1:04 PM EDT) -- Delaware courts have recently ruled on the validity of a shareholder rights plan, or "poison pill," in two situations that presented issues of first impression under Delaware law.

On Aug. 12, 2010, Vice Chancellor Leo E. Strine, in Yucaipa American Alliance Fund II LP v. Riggio, C.A. No. 5465-VCS (Del. Ch. Aug. 12, 2010), upheld the use of a poison pill with a 20 percent threshold to delay a possible takeover of Barnes & Noble Inc. by funds controlled by Ronald Burkle, even though the founder...
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