Chancery Should Reconsider Its Decision In Trulia

By Michael Maimone and Joseph Schoell, Drinker Biddle & Reath LLP (May 9, 2017, 10:34 AM EDT) -- Over the past year, much has been written about In re Trulia Inc. Shareholder Litigation.[1] This decision of the Delaware Court of Chancery has been (a) described as "a devastating blow to disclosure settlements,"[2] (b) recognized as a response to "the abusive nature of much M&A litigation,"[3] (c) identified as "the procedural prong of the Delaware courts' general effort to reduce the volume of unnecessary M&A litigation,"[4] (d) branded "a new regime for the court's consideration of proposed disclosure-based settlements of litigation challenging M&A transactions,"[5] (e) acknowledged as not a mere "clamp on disclosure-only settlements in merger and acquisition lawsuits; [but having] established a new paradigm for what kinds of challenges to deals will pass muster in" Delaware,[6] and (f) characterized as "a new rule for evaluating disclosure settlements — the 'plainly material' standard — and expressed a preference for disclosure claims to be either litigated or mooted."[7] All of these descriptions of Trulia were made by commentators in one publication — Law360 — and many more articles in many more publications have been written predicting the impact of Trulia....

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