Wolf Popper LLP, as Co-Lead Counsel for Plaintiffs, is prosecuting an action under Delaware law on behalf of the former public shareholders of Cornerstone Therapeutics Inc. (“Cornerstone”), against Cornerstone’s controlling shareholder Chiesi Farmaceutici S.p.A. (“Chiesi”), and against Cornerstone’s former directors, for breaches of fiduciary duty related to Chiesi’s $255 million buyout of Cornerstone.
On September 10, 2014, Vice Chancellor Sam Glasscock, III of the Delaware Court of Chancery denied the former Cornerstone directors’ motion to dismiss the claims against them. In upholding Plaintiffs’ claims, Vice Chancellor Glasscock found that, “the Plaintiffs have made a sufficient pleading that a stockholder controlled the corporate machinery; that it used that machinery to facilitate a transaction of which it thus stood on both sides; that the transaction was not entirely fair to the minority; and that the Director Defendants negotiated or facilitated the unfair transaction. Such a pleading is sufficient, under controlling precedent, to withstand a motion to dismiss on behalf of the Director Defendants.” Vice Chancellor Glasscock found that, because Delaware’s “entire fairness” standard applies to the buyout, the former directors “must await a developed record, post-trial, before their liability is determined,” and thus cannot have claims against them dismissed at this stage.