Secured a record-setting $420 million settlement for shareholders — the largest in Delaware Chancery Court history
Plaintiff(s):
Shareholders of Digex, Inc.
Case type / claims:
Class action alleging that the directors and controlling stockholder of Digex, Inc. breached fiduciary duties by permitting the majority stockholder to usurp a lucrative corporate opportunity that rightfully belonged to Digex. The dispute arose from the sale of Digex’s parent company, Intermedia Communications, to WorldCom, during which Digex shareholders were denied the value of Digex’s own direct acquisition potential.
Defendant(s):
Directors and majority stockholder of Digex, Inc.
Jurisdiction:
Delaware Chancery Court
Year:
2001
Outcome:
- Grant & Eisenhofer secured a $420 million settlement — the largest ever obtained in the Delaware Chancery Court.
- Recognized as a landmark decision reinforcing fiduciary duties owed by controlling shareholders in M&A transactions.
- Strengthened Delaware corporate law protections for minority shareholders in corporate opportunity disputes.
