The Harvard Law School Forum on Corporate Governance https://corpgov.law.harvard.edu The leading online blog in the fields of corporate governance and financial regulation. Mon, 06 Apr 2026 11:32:10 +0000 en-US hourly 1 https://wordpress.org/?v=6.5.8 https://corpgov.law.harvard.edu/wp-content/uploads/2024/02/cropped-photography-4-e1706898544564-1-32x32.png Drafting Guidance from Delaware Supreme Court on Earnouts, Efforts Obligations, and Fraud – The Harvard Law School Forum on Corporate Governance https://corpgov.law.harvard.edu 32 32 Drafting Guidance from Delaware Supreme Court on Earnouts, Efforts Obligations, and Fraud https://corpgov.law.harvard.edu/2026/02/10/drafting-guidance-from-delaware-supreme-court-on-earnouts-efforts-obligations-and-fraud/?utm_source=rss&utm_medium=rss&utm_campaign=drafting-guidance-from-delaware-supreme-court-on-earnouts-efforts-obligations-and-fraud https://corpgov.law.harvard.edu/2026/02/10/drafting-guidance-from-delaware-supreme-court-on-earnouts-efforts-obligations-and-fraud/#respond Tue, 10 Feb 2026 12:30:50 +0000 https://corpgov.law.harvard.edu/?p=179143?d=20260209191758EST Posted by Gail Weinstein, Philip Richter, and Steven Epstein, Fried Frank, on Tuesday, February 10, 2026
Editor's Note:

Gail Weinstein is a Senior Counsel, Philip Richter is a Partner, and Steven Epstein is the Managing Partner at Fried, Frank, Harris, Shriver & Jacobson LLP. This post is based on a Fried Frank memorandum by Ms. Weinstein, Mr. Richter, Mr. Epstein, and Maxwell Yim, and is part of the Delaware law series; links to other posts in the series are available here.

In Johnson & Johnson v. Fortis Advisors (Jan. 12, 2026), the Delaware Supreme Court reversed the Court of Chancery’s decision that, based on the implied covenant of good faith and fair dealing, Johnson & Johnson breached its efforts obligations with respect to the first earnout payment under the Merger Agreement pursuant to which, in 2019, it acquired Auris Health, Inc., a medical robotics company. In a 2024 decision, the Court of Chancery had awarded Auris damages of over $1 billion ($300 million of it attributed to the breach with respect to the first earnout payment).

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