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Announcement: January 2019: Quinn Emanuel Involved in Two of Top Five Delaware Cases to Watch in 2019

Business Litigation Reports

Law360 recently published its top five Delaware cases to watch in 2019. Quinn Emanuel is proud to be involved in two of Law360’s five cases: In re: Pilgrim’s Pride Corp. Derivative Litigation and In re: Oxbow Carbon LLC Unitholder Litigation. Few firms are involved in any of Law360’s five cases to watch. No firm is involved in more of them than we are.

In Pilgrim’s Pride, we represent JBS SA and other Defendants in a heavily publicized breach of fiduciary duty action. The case arises from Pilgrim’s Pride Corp.’s $1.3 billion acquisition of Moy Park, a UK-based poultry firm, from JBS SA, Pilgrim’s Pride’s controlling shareholder. Plaintiffs allege that Defendants, including JBS SA and Pilgrim’s Prides’ directors, breached their fiduciary duties by allegedly permitting Pilgrim’s Pride to “overpay” for Moy Park. Following the motion to dismiss argument—where our clients argued that the court lacked personal jurisdiction over them and that the complaint failed to state a claim—Vice Chancellor Laster asked the parties for supplemental briefing regarding whether actions taken by “enhanced independence directors”—i.e. independent directors that are elected solely by the minority—should be subject to the business judgment rule. We filed supplemental briefing on December 21, 2018 advocating for the business judgment rule to apply for actions taken by “enhanced independence directors.” A ruling in our client’s favor on this issue would provide greater clarity under Delaware law for independent committees who are assessing potential transactions.

In Oxbow Carbon, we represent funds associated with Crestview Partners LP in a closely watched appeal regarding Delaware’s implied covenant of good faith and fair dealing. At the trial level, we secured a substantial victory on behalf of Crestview against Oxbow Carbon LLC and William Koch, Oxbow’s founder and CEO. The dispute concerns Crestview’s contractual right, as a minority stakeholder in Oxbow, to sell the company under the terms of Oxbow’s operating agreement. In a lengthy post-trial opinion, Vice Chancellor Laster found that the implied covenant of good faith and fair dealing applied to prohibit Koch’s attempts to block a sale. The Court’s post-trial decision is one of only a handful of decisions in Delaware that has ever applied the implied covenant doctrine to “fill a gap” in an LLC Agreement.