In an order dated June 30, 2023, Labaton Sucharow achieved a notable post-trial victory for former Columbia Pipeline Group, Inc. ("Columbia") shareholders. Following a previous $79 million settlement with now-retired Columbia executives, the Delaware Court of Chancery held that energy giant TC Energy Corp. ("TransCanada")—which acquired Columbia in 2016—is liable to former Columbia shareholders for aiding and abetting breaches of fiduciary duty by former Columbia top executives in connection with the deal. Former Columbia shareholders were awarded economic damages of $1.00 per share and disclosure damages of $0.50 per share. It is a substantial amount for the former Columbia shareholders, who collectively held more than 400 million outstanding shares of stock ahead of the merger, per the 196-page decision.
Vice Chancellor J. Travis Laster said the $1 per share represents "the value that the plaintiffs would have received but for the sell-side breaches of duty and TransCanada's culpable participation." And the $0.50 per share represents a "discretionary amount designed to remedy the harm to the stockholders' decisional and economic rights in a setting where fiduciaries requested stockholder action, yet failed to provide the stockholders with the information necessary to make an informed decision," the Vice Chancellor held.
The shareholders have also proven that TransCanada "exploited—with gusto—the breaches of fiduciary duty by Skaggs, Smith and the board," per the order.
The case is In re: Columbia Pipeline Group Merger Litigation, C.A. No. 2018-0484 (Del. Ch.).
Read the full article here: "Pipeline Investors Win $1 Per Share in Massive Chancery Win."