When Del. Courts May Reject Corwin Cleansing: Some Clarity
By Gail Weinstein, Philip Richter, Steven Epstein and Warren de Wied (July 13, 2017, 1:30 PM EDT) -- Under Corwin, if stockholders approve a board action in a "fully informed" and "uncoerced" vote, the stockholder approval "cleanses" any breaches by the directors of their fiduciary duties in connection with the action. Since Corwin was decided in 2015, in every case where the defendants were seeking Corwin cleansing, the Delaware courts have found that the stockholder vote was fully informed and uncoerced — with the only exceptions being the recent decisions in In re Saba Software Stockholder Litigation (April 11, 2017), Sciabacucchi v. Liberty Broadband Corp. and Charter Communications Inc. (May 31, 2017), and In re Massey Energy Co. Derivative and Class Action Litigation (May 4, 2017)....
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