In Gordon v. Verizon, New York Appellate Division Shows Greater Receptivity to Non-Monetary Settlements than Delaware Courts Have Shown Since Trulia

By: Abigail Pickering Bomba, Warren S. de Wied, Steven Epstein, Arthur Fleischer, Jr., David J. Greenwald, Scott B. Luftglass, Philip Richter, Robert C. Schwenkel, Peter L. Simmons, Gail Weinstein

In Gordon v. Verizon Communications (Feb. 2, 2017), the New York Appellate Division showed greater receptivity toward non-monetary settlements (possibly including “disclosure-only” settlements) than the Delaware courts have since the Court of Chancery's seminal 2016 Trulia decision. Based on Gordon, the plaintiffs' bar may seek to file M&A lawsuits in New York, when possible, rather than in Delaware. Delaware corporations that do not yet have a Delaware-only forum selection bylaw may now consider adopting one to ensure that the strict standards of Trulia will apply (thereby discouraging the plaintiffs' bar from bringing non-meritorious M&A suits). We note that a Delaware corporation headquartered in New York that has such a bylaw may decide to waive it and permit suit to be brought in New York if the company believes that would be a more favorable forum for the litigation or a potential settlement. In the attached Fried Frank M&A Briefing, we discuss other potential effects of the decision and offer related practice points.

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