Insiders' M&A Paydays Fair Game For Del. Class Actions

Law360, New York (April 3, 2013, 5:21 PM EDT) -- Venture capital, take heed: A Chancery Court decision this week will give entrepreneurs a big club to challenge preferred stock issuances that result in lopsided spoils from later sales.

In Carsanaro v. Bloodhound Technologies Inc., Vice Chancellor J. Travis Laster said stockholders could file class action — not just derivative — lawsuits against insiders for preferred stock issuances that dilute common shareholders. That opens the door for class actions and could better arm startup founders to challenge transactions that sideline them, said Curtis Alva of Holland...
To view the full article, register now.
Law360 Pro Say Podcast
Check out Law360's new podcast, Pro Say, which offers a weekly recap of both the biggest stories and hidden gems from the world of law.