Archive for September, 2010

Split Decision in Delaware

September 9, 2010

We are pleased with the Chancellor Chandler’s split decision, which he foreshadowed in his concluding remarks at trial. As the Chancellor opines intoday’s ruling, “more fortunate than Goliath, eBay leaves this field with only a gash across its forehead; less fortunate than David, craigslist leaves this field with something less than total victory.”

He affirmed craigslist’s “Staggered Board Amendments,” finding they were approved “in good faith to prevent eBay, a business competitor, from having access to confidential craigslist board discussions.” He also provided valuable guidance to fiduciaries of closely-held private companies like craigslist, when carrying out their obligations to protect against conflicted, duplicitous, and/or predatory shareholders.

The Chancellor deferred to “the California judiciary” to decide “whether eBay’s use of craigslist’s non-public information or its competitive activity was unlawful.” These and craigslist’s other claims will now be taken up in San Francisco before Superior Court Judge Richard A. Kramer, in craigslist vs eBay, filed May 2008 but stayed pending today’s ruling.


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