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PSD Boston and New York class action lawyers won their opposition to a motion to dismiss before Chancellor Bouchard in the Delaware Chancery Court. PSD represents a medical device innovator, Ken Carr, who is the corporate founder of a medical device technology company. Carr suffered dilution of his holdings and the effects of a blown warrant sale to a major manufacturer. The court issued the 62-page Memorandum Opinion on March 26, 2018.
Novel Corporate Law Issues
The case presented several novel issues of Delaware law. In its written opinion, the Court rejected the suggestion by defense counsel that warrants cannot trigger Revlon duties. The court also found demand on the board excused as futile. As a result, the court left in the case both direct and derivative claims.The lengthy ruling keeps the majority stockholder group and certain affiliates of it in the case. The court will likely soon set a schedule for class action briefing and a trial.
The court explained: “Equity-Link and Binks support the proposition that it would be appropriate to
apply the intermediate scrutiny of Revlon, at least in certain circumstances, to evaluate a board’s decision to grant a third-party an option to acquire control of a corporation, as opposed to a decision to sell the corporation outright. Indeed, if that were not the case, a party could seek to evade the special protections Revlon affords stockholders through creative structuring of a transaction (e.g., an unconditional, immediately exercisable option to purchase the entire company) that in substance is equivalent to an outright sale of the corporation. That would be an absurd result.”
The case involves warrants priced in the tens of millions of dollars. The warrants had exercise prices and threshold payments that involve more than $100 million.
Lead Counsel
Boston and New York class action lawyers, and PSD founding partners, Barry Pollack and Joshua Solomon have served as lead counsel for Carr. Pollack argued the motion back in December 2017.
Boston probate litigation lawyer wons a trust contest. PSD founding partner Peter Duffy won dismissal of all claims by a beneficiary to change a family trust. Specifically the petitioner sought to treat as an heir, under the trust, a man he adopted as an adult.
Adopted Adult Son
The petitioner sought to permit his adopted son—whom he adopted as an adult—to succeed to his interest in his grandfather’s trust. Some family members challenged the petitioner’s ability to seek an advisory opinion. Consequently, Petitioner sought confirmation that his adopted son would stand in the petitioner’s shoes after his death. Of particular note, the petitioner had no biological children. As a result, he hoped adoption of the adult would allow him to pass along his interest in his grandfather’s trust. If not, his shares would go to his siblings and their heirs.
Boston Probate Litigation Lawyer Wins Trust Contest
Petitioner asked the court to modify the family trust or declare that petitioner’s adopted son may inherit his share of the Trust. Duffy argued that, in order for the inheritance to happen, certain precipitating events must transpire. Specifically, the Trust provided for its own termination twenty-one years following the deaths of several named individuals. Hence, certain individuals must die, and the Petitioner must perish before twenty-one years passed following their deaths. In a 12-page opinion, titled In re Phillips Trust, the court found the action premature because certain conditions had not occurred. The court explained that these conditions constituted prerequisites to an actual controversy. Furthermore, the court rejected the petitioner’s effort to amend the Trust because only some, not all, beneficiaries consented to the relief.
PSD Boston Probate Attorneys
With lawyers in Boston and New York, PSD represents clients in probate matters that include trust disputes and family law actions. These matters often involve custody issues and business valuations. PSD has significant experience in international child abduction and custody matters. Also, PSD represents individuals and businesses in high-stakes cases. These matters include private equity and hedge funds, securities transactions, False Claims Act issues, healthcare matters, and employment disputes. In this matter, Boston Probate litigation lawyer won a trust contest among family members.
False Claims Act Lawyers Move to Dismiss
Boston false claims act lawyers, led by Barry Pollack, won dismissal of qui tam case in Maryland.
On March 6, 2018, the United States District Court for the District of Maryland dismissed a qui tam action brought by a former employee against a PSD client. The plaintiff claimed that she was fired after reporting Form I-9 deficiencies to her supervisor. In a 21-page opinion, the court rejected all claims.
The court dismissed Count I, which attempted to plead a violation of the False Claims Act. The court found a lack of sufficient allegations of falsity and materiality. In doing so, the court agreed with defendants that it could consider the forms at issue. Defendants submitted blank versions of the forms to the motion to dismiss.
The court noted: “Because Potter has not contested the authenticity of these forms and they are integral to Potter’s Complaint, the Court considers them.” In its analysis, the court explained that, while allegations of false certifications of compliance can suffice , “the compliance at issue must be ‘a prerequisite’ to securing the government funding ….’” As a result of the limited items that CASA certified, the court found that Potter failed to allege a false certification. Also, the court held that, “[b]ecause the Complaint does not show how CASA’s failure to disclose its 1-9 noncompliance would have influenced the government’s funding decisions, Potter has not adequately demonstrated materiality.” The court dismissed the case without prejudice in light of Potter’s complaint predating a recent Supreme Court decision. But the court noted skepticism about Potter’s ability to state a claim.
Also, the court dismissed Count II, which attempted to plead a conspiracy to violate the FCA, agreeing with defendants. The court stated that “Potter’s conspiracy claim turns on the same factual basis … as her substantive FCA claim.”
A copy of the decision can be found here: 180307-opinion-dismissing-claims
Retaliation Claim Dismissed
In its decision, the court also dismissed Count III, which attempted to plead a retaliation claim under the FCA. The court found that Potter based her retaliation claim on reporting Form I-9 deficiencies. This did not trigger the statutory protection because she did not allege retaliation for raising potential FCA claims. In addition, the court found that Potter’s allegations failed to show an objectively reasonable belief that a claim under the FCA might proceed. Again the court allowed Potter to try to replead., but again expressed skepticism. The court cautioned that “according to Defendants’ Reply, Potter’s DOJ disclosure focused on CASA’s supposed violations of immigration law rather than fraud under the FCA.” The court continued, “to the extent Defendants are correct, Potter cannot cure her FCA retaliation claim ….”
New York and Boston False Claims Act Lawyers at PSD
PSD is a litigation law firm with a national focus and lawyers in Boston and New York. PSD’s areas of focus include private equity and hedge fund litigation, healthcare matters, white collar criminal defense, employment disputes. PSD also represents clients in probate court cases including family law, wills, trusts, and international child abduction/custody matters. In this matter, PSD’s Boston false claims act lawyers won dismissal of qui tam action. For further information about Boston false claims act lawyers, visit PSD’s website.