Almost every acquisition of a large U.S. public company announced in 2010 or 2011 elicited multiple lawsuits, according to a report by Cornerstone Research and Professor Robert Daines of the Stanford Law School. Only a small fraction of these lawsuits, however, resulted in payments to shareholders; the majority settled for additional disclosures or, less frequently, changes in merger terms, such as deal protection provisions.
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Our January 2012 publication of Recent Developments in Shareholder Litigation Involving Mergers and Acquisitions, garnered widespread media, academic, and industry interest, and was cited in a recent Delaware Court of Chancery ruling. We have now updated the report to include more recent data and have added analyses of litigation by industry and plaintiff attorney fees.
The report identifies 789 lawsuits filed for acquisitions of U.S. public companies valued at or over $100 million announced in 2010, and 740 lawsuits filed for such deals announced in 2011. As of late March 2012, sixty-seven lawsuits have already been reported for thirteen out of seventeen deals announced during January and February 2012.