Monthly Archives: March 2016

In FdG Logistics v. A&R Logistics (Feb. 23, 2016), the Delaware Court of Chancery held that an anti-reliance provision in a merger agreement is not effective if it is drafted solely “from the point of view” of the seller rather than the buyer.

An anti-reliance provision is intended to convey that, in determining to proceed with an acquisition, the buyer has relied only on the selling parties’ representations and warranties that are expressly set forth in the acquisition agreement, and has not relied on any other statements made or information provided (or omitted) by the selling parties, whether during due diligence or otherwise. As was confirmed recently in the court’s November 2015 Prairie Capital decision, an effective anti-reliance provision will bar a buyer from bringing post-closing fraud claims based on extra-contractual information (even if the agreement excluded fraud claims from the provision stating that indemnification would be the exclusive remedy and even if the extra-contractual information provided was indeed fraudulent). If the anti-reliance provision is effective, the only fraud claim that would be viable would be for fraud intrinsic in the contract—that is, for an intentional misrepresentation or omission in the representations and warranties.

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