Gail Weinstein is Senior Counsel and Warren S. de Wied is a Partner at Fried, Frank, Harris, Shriver & Jacobson LLP. This post is based on a Fried Frank publication by Ms. Weinstein, Mr. de Wied, Philip Richter, Steven Epstein, Robert C. Schwenkel, and Scott B. Luftglass. This post is part of the Delaware law series; links to other posts in the series are available here.
In Brinckerhoff v. Enbridge Energy Company, Inc., the plaintiff, an investor in the Enbridge Energy Delaware master limited partnership (the “MLP”), challenged a $1.2 billion transaction between the MLP and the controlling parent corporation (“Parent”) of the MLP’s general partner (the “GP”). The factual context was the repurchase by the MLP of an asset it had previously sold to Parent—with the repurchase at a significantly higher price, despite strong indications that the value of the asset had declined, and without the GP or its banker having considered the earlier sale as a comparable transaction. The Delaware Supreme Court, in an opinion written by Justice Seitz (March 20, 2017), reversed the Court of Chancery’s dismissal of the case.
