Delaware Courts Research Articles

Delawarees Public Benefit Corporations: Comparative Analysis and Fiduciary Duties

The Delaware Court of Chancery asserted in eBay Domestic Holdings v. Newmark that all activities of a for-profit Delaware corporation must seek to maximize the economic value for its stockholders. While the requirement to maximize stockholder value bolsters investors’ confidence in Delaware corporations, it also limits the abilities of corporations to pursue activities that are conducted for a public benefit. The continued expansion of socially-responsible investing demonstrates that investors are willing to balance maximized stockholder value with corporate environmental stewardship, improved labor conditions, and the pursuit of myriad causes. Delaware recently became the nineteenth state to enact legislation authorizing the creation of public benefit corporations. A public benefit corporation (PBC) is a for-profit corporation with a tri-partite interest-balancing scheme that allows the corporation to pursue activities for public benefit in addition to its profit-maximizing goals. PBC status increases investment by strengthening investors’ confidence through transparency and regulation, as well as by allowing the incorporation of organizations that were previously prohibited from pursuing public-benefit activities as a for-profit corporation. Though Delaware joins such corporate strongholds as New York, Pennsylvania, and California in codifying PBCs, the implementation in Delaware is transformational. The enactment of PBCs, their success, and the eventual development of decisional PBC law in Delaware, the incorporation capital of the world, will chart the path for public benefit corporations nationally. Part II of this note explains public benefit corporations, their purpose and objectives, and their impact. Part III examines the implementation of PBCs in Delaware, and in particular, how Delaware’s PBC fiduciary-duty provisions differ from those in the model act and in other states. Since PBCs in Delaware are still in their infancy and decisional law is still undeveloped, Part IV explores how the fiduciary-duty provisions are likely to be interpreted in light of existing Delaware corporate law and other relevant authorities.

Hostile takeover bids in the European Union: regulatory steps en route to an integrated capital market

This paper intends to highlight the regulatory direction concerning hostile takeover bids, along the European Union moves forward. For the first sight it was difficult to forecast the effects of the EU Takeover Directive. Some of its provisions certainly meant asignificant step towards establishing a higher level ofprotection for minority shareholders. However, someother provisions could have indirect adverse effects.The breakthrough rule for instance, as currently implemented into the national laws, seems unlikely to carry any kind of notable benefit in the short term. There is a fundamental difference that can be revealed between the regulatory systems of the United States and the European Union in terms of their orientation.In the United States the practice of the Delaware courts definitely rejected shareholder decision making innumerous significant decisions concerning takeovers and simultaneously emphasized the importance of directors in corporate management. However, in Europe the regulations rely on shareholder decisionmaking to a much greater extent.

The Peculiar Role of the Delaware Courts in the Competition for Corporate Charters

From the classic Cary-Winter debate to current legal scholarship, commentators have struggled to explain Delaware's dominance in the market for corporate charters. Although scholars have offered nonsubstantive explanations such as network externalities, interest group dynamics, and Delaware's expert and specialized judiciary, much of the debate focuses on substantive law. This article takes another view. Arguing that a regulator can offer benefits through its lawmaking process, as well as its legal rules, the article suggests a process-oriented analysis of regulatory competition. The article focuses on the unique role of the Delaware judiciary in corporate lawmaking, a role that has received little attention from corporate law scholars. The article demonstrates that Delaware uses a unusual process to make corporate law, relying heavily on judge-made law, but employing a different lawmaking structure than that used by other states. As a result of this structure, Delaware judicial lawmaking more closely resembles legislation in its scope, flexibility, and responsiveness. The article then evaluates this lawmaking structure from a standpoint of comparative institutional advantage. In particular, the article compares Delaware's process to the legislative process. The article concludes that Delaware lawmaking offers particular advantages, including flexibility, responsiveness, reduced political influence, and transparency. These benefits increase Delaware's ability to adjust its corporate law to changes in the business world. The article's explanatory power includes its identification of the role of the Delaware courts as central to Delaware's dominance of the market for corporate charters. Moreover, the article's assessment of the importance of the lawmaking process has important implications for the application of Delaware's success to continuing questions of regulatory design.

The 'Look-Through Approach': Why Delaware Must Use this Approach for Determining Attorneys' Fees in Derivative Suits Similar to Southern Peru

Derivative suits permit shareholders of a corporation to sue management on the corporation’s behalf if, for example, management breaches a fiduciary duty. Damages awarded in derivative suits go into a common fund, from which attorneys’ fees are deducted. In Delaware, a five-factor test is used to determine the percentage of the common fund to be paid as attorneys’ fees. Under firmly established Delaware precedent, any monetary award in a derivative suit must go to the corporation in its entirety, and not to the shareholders who brought the suit. This precedent applies even if the majority shareholder of the corporation on whose behalf the derivative suit has been brought is a defendant in the derivative suit. In Southern Peru, that was exactly the case. In Southern Peru, the Delaware Court of Chancery awarded a common fund of over $2 billion in a derivative suit. Subsequently, the Chancellor awarded more than $300 million of the common fund as attorneys’ fees. This amounted to an hourly rate of over $35,000 per hour, leading to claims that the attorneys’ fee award was a windfall. The majority shareholder defendant in Southern Peru appealed the fee award to the Delaware Supreme Court, which upheld the award. The majority shareholder defendant then filed a motion for reargument, claiming that only a portion of the common fund should have been used as the basis for attorneys’ fees, corresponding to the percentage of the corporation on whose behalf the derivative suit had been brought that was owned by minority shareholders. This approach, called the "look-through approach," was rejected by the Delaware Supreme Court, as being incompatible with Delaware precedent requiring that any monetary award in a derivative suit go to the corporation in its entirety. The motion was denied. This Note argues that, in cases similar to Southern Peru, Delaware needs to use the "look-through approach" to determine the portion of the common fund to be the basis for attorneys’ fees. As the approach would only be used to determine attorneys’ fees, it is compatible with Delaware precedent. The common fund would still go to the corporation in its entirety. Therefore, Delaware precedent is not violated. This Note argues that the "look-through approach" must be used by the Delaware courts when the majority shareholder of the corporation on whose behalf the derivative suit has been filed is a defendant in the derivative suit, and when the amount of the common fund is over $500 million. When those two conditions are met, use of the "look-through approach" would be bright-line and automatic. This Note argues that use of the "look-through approach" in such situations would further two important goals of the Delaware courts. Those two goals are discouraging forum-shopping and thus keeping shareholder litigation in Delaware, and reducing the possibility of attorneys’ fee awards being perceived as windfalls.

How sell side advisors can reduce litigation risk in light of Delaware’s Rural/Metro decision

Purpose – To explain the implications of a March 2014 Delaware Court of Chancery decision that found RBC Capital Markets liable for damages for aiding and abetting breaches of fiduciary duty by the directors of Rural/Metro Corporation in connection with the company’s 2011 sale to an affiliate of Warburg PIncus. Design/methodology/approach – Explains the court’s findings and decision, offers procedural lessons for sell-side financial advisors, and recommends what sell-side advisors can do to limit exposure to aiding and abetting claims. Findings – The Rural/Metro decision opens the door to additional litigation risk for sell-side advisors. However, Vice Chancellor Laster’s opinion also provides a roadmap for how an advisor can limit that risk. Practical implications – Director and financial advisor liability most often results from process failures. Originality/value – Practical guidance from experienced mergers and acquisitions and securities and corporate governance lawyers.

Why We Should Stop Teaching Dodge v. Ford

Among non-experts, conventional wisdom holds that corporate law requires boards of directors to maximize shareholder wealth. This common but mistaken belief is almost invariably supported by reference to the Michigan Supreme Court's 1919 opinion in Dodge v. Ford Motor Co. This Essay argues that Dodge v. Ford is bad law, at least when cited for the proposition that maximizing shareholder wealth is the proper corporate purpose. As a positive matter, U.S. corporate law does not and never has imposed a legal obligation on directors to maximize shareholder wealth. From a normative perspective, options theory, team production theory, the problem of external costs, and differences in shareholder interests all suggest why a rule of shareholder wealth maximization would be bad policy and lead to inefficient results. Courts accordingly treat Dodge v. Ford as a dead letter. (In the past three decades the Delaware courts have cited the case only once, and then on controlling shareholders' duties to minority shareholders). Nevertheless, legal scholars continue to teach and cite it. This Essay suggests that Dodge v. Ford has achieved a privileged position in the legal canon not because it accurately captures the law - it does not - or because it provides good normative guidance - it does not - but because it serves professors' need for a simple answer to the question, What do corporations do? Simplicity is not a virtue when it leads to misunderstanding, however. Law professors should mend their collective ways, and stop teaching Dodge v. Ford as anything more than an example of how courts can go astray.

Supplying the Adverb: The Future of Corporate Risk-Taking and the Business Judgment Rule

The business judgment rule precludes judicial review of most decisions by corporate directors. The rule is necessary to protect directors from potential liability for decisions that ultimately end in failure. Courts and legal commentators have long emphasized the importance that the rule has in promoting the kind of risk-taking by corporations that has resulted in new ideas, new technologies and new markets. In recent years, Delaware courts have shown so much deference to risk-taking that they have misapplied the still-evolving doctrine of good faith. Professor Rosenberg argues that courts should use the same standards of good faith to evaluate accusations of excessive risk-taking that they use to evaluate other kinds of director misconduct such as disloyalty and a failure to be adequately informed. This would go a long way to making Delaware fiduciary law more consistent as it is applied to a variety of alleged director misconduct, but would do little to damage the ability of directors to take the kind of beneficial risks that have been so central to the historical success of the American corporation.

How do staggered boards affect shareholder value? Evidence from a natural experiment

The well-established negative correlation between staggered boards (SBs) and firm value could be due to SBs leading to lower value or a reflection of low-value firms' greater propensity to maintain SBs. We analyze the causal question using a natural experiment involving two Delaware court rulings—separated by several weeks and going in opposite directions—that affected the antitakeover force of SBs. We contribute to the long-standing debate on staggered boards by presenting empirical evidence consistent with the market viewing SBs as leading to lower firm value for the affected firms.

Standing at the Singularity of the Effective Time: Reconfiguring Delaware's Law of Standing Following Mergers and Acquisitions

This article examines the doctrine of standing as applied to mergers and acquisitions of Delaware corporations with pending derivative claims. Finding the existing framework of overlapping rules and exceptions both structurally and doctrinally unsound, this article proposes a novel reconfiguration of existing Delaware law under which Delaware courts would follow three black-letter rules: (1) stockholders of the target should have standing to sue target directors to challenge a merger directly on the basis that the board failed to achieve adequate value for derivative claims; (2) a merger should eliminate target stockholders’ derivative standing; and (3) stockholders of the acquiror as of the time a merger is announced should be deemed contemporaneous owners of claims acquired in the merger for purposes of derivative standing. Following these rules would restore order to the Delaware law of standing in the merger context and would advance the important public policies served by stockholder litigation in the Delaware courts.

Let's Keep All of the Lawsuits in One Place: Choice of Forum Provisions in a Corporation's Bylaws

In Boilermakers Local 154 Retirement Fund v. Chevron Corporation, the Delaware Chancery Court upheld the enforceability of bylaws provisions adopted by the directors of Chevron and FedEx that required lawsuits regarding the internal affairs of those two Delaware corporations to be brought only in Delaware courts. There are a number of Delaware corporations with their principal place of business in Colorado and other states, and there are more publicly held Delaware corporations than those incorporated under the laws of any other state. In light of these facts and the recent Boilermakers Local 154 decision, in a nine part series of posts Professor J. Robert Brown noted his opinion that Delaware courts are “management friendly” - a regular theme in that excellent blog. Other authors argue that the Delaware courts have a “balanced approach” when dealing with stockholder - management issues. Boilermakers Local 154 may be perceived as favoring boards of directors’, but it cannot be said that the decision is “management friendly.” Rather, the decision is “corporation friendly.” In the decision, the Chancery Court recognizes the business judgment in adopting forum selection bylaws for purposes of efficiency. The decision also recognizes that stockholders have a choice whether to invest in a Delaware corporation and thereby subject themselves to the DGCL, and the corporation’s certificate of incorporation (and the choices made therein). With that choice, stockholders need to understand the legal powers of their board and the dynamics of bylaws adoption.

The Short and Puzzling Life of the 'Implicit Minority Discount' in Delaware Appraisal Law

The implicit minority discount, or IMD, is a fairly new concept in Delaware appraisal law. A review of the case law discussing the concept, however, reveals that it has emerged haphazardly and has not been fully tested against principles that are generally accepted in the financial community. While control share blocks are valued at a premium because of the particular rights and opportunities associated with control, these are elements of value that cannot fairly be viewed as belonging either to the corporation or its shareholders. In corporations with widely dispersed share holdings, the firm is subject to agency costs that must be taken into consideration in determining going concern value. A control block-oriented valuation that fails to deduct such costs does not represent the going concern value of the firm. As a matter of generally accepted financial theory, on the other hand, share prices in liquid and informed markets do generally represent that going concern value, with attendant agency costs factored or priced in. There is no evidence that such prices systematically and continuously err on the low side, requiring upward adjustment based on an implicit minority discount.Given the lack of serious support for the IMD in finance literature, this Article suggests that the Delaware courts may be relying on the IMD as a means to avoid imposing upon squeezed-out minority shareholders the costs of fiduciary misconduct by the controller. Where either past or estimated future earnings or cash flows are found to be depressed as a result of fiduciary misconduct, however, or where such earnings or cash flows fail to include elements of value that belong to the corporation being valued, the appropriate way to address the corresponding reduction in the determination of fair value is by adjusting those subject company earnings or cash flows upward.This approach to the problem of controller opportunism is more direct, more comprehensive in its application, and more in keeping with prevailing financial principles, than the implicit minority discount that the Delaware courts have applied in the limited context of comparable company analysis. The Delaware courts can therefore comfortably dispense with resort to the financially unsupported concept that liquid and informed share markets systematically understate going concern value.

Why Do Distressed Companies Choose Delaware? An Empirical Analysis of Venue Choice in Bankruptcy

We analyze a sample of large Chapter 11 cases to determine which factors motivate the choice of filing in one court over another when a choice is available. We focus in particular on the Delaware court, which became the most popular venue for large corporations in the 1990s. We find no evidence to suggest that Delaware's popularity was driven by managers or equity holders seeking a procedure friendly to their interests. Instead, debt structure differences, specifically, the fraction of assets financed with secured debt, and court characteristics, particularly a court's level of experience, are the most important factors driving the choice of venue. While Delaware does not appear significantly different with respect to deviations from absolute priority in favor of equity or likelihood of producing reorganizations, it does differ along the dimension of speed. Controlling for other factors, we find that a Delaware reorganization is between 140 and 190 days faster than an equivalent case in another court. Given that speed benefits secured creditors most, we conclude that Delaware's popularity in the 1990s was unlikely to have resulted from a pro-debtor bias combined with a manager or equity holder preference for Delaware.

How to Prevent Hard Cases from Making Bad Law: Bear Stearns, Delaware and the Strategic Use of Comity

The Bear Stearns/JP Morgan Chase merger placed Delaware between a rock and a hard place. On the one hand, the deal's unprecedented deal protection measures - especially the 39.5% share exchange agreement - were probably invalid under current Delaware doctrine because they rendered the Bear Stearns shareholders' approval rights entirely illusory. On the other hand, if a Delaware court were to enjoin a deal pushed by the Federal Reserve and the Treasury and arguably necessary to prevent a collapse of the international financial system, it would invite just the sort of federal intervention that would undermine Delaware's role as the de facto provider of U.S. corporate law.Faced with a choice between undermining the delicate and subtle balance struck between managers and shareholders and standing in the way of the imperatives of national and international economic policy, Delaware found a third way that avoided both horns of the dilemma: it took advantage of a pending New York action to stay the Delaware action and avoid making any decision at all. In this article, we tell this story, analyzing the doctrinal issues under Delaware corporate and procedural law, and discussing the implications of this episode for our understanding of the landscape of US corporate law making.

Merger Class Actions in Delaware and the Symptoms of Multi-Jurisdictional Litigation

Recent research on corporate litigation has focused on three trends: the growth in percentage of mergers that result in litigation, the migration of cases away from Delaware, and the increasing prevalence of merger litigation occurring simultaneously in multiple jurisdictions. This Symposium Article uses a new and unique dataset of public company litigation to track how these trends have affected filings and litigation tactics in the Delaware Court of Chancery from 2004 to 2011. The data confirm that Delaware appears to have experienced a decline in filings during the early and middle periods of the sample, but the data also shows that there has been a sharp increase in the number of the number of acqusition-related cases filed in Delaware in 2010 and 2011.The rise of concurrent, multi-jurisdictional litigation and the litigation tactics that it encourages are the likely reasons for the growth of acquisition-related cases in Delaware. While some plaintiffs’ attorneys may have left Delaware to escape the Chancery’s threats of lower attorneys’ fees and merit-based selection of lead counsel, in the current environment a Delaware filing may provide strategic advantages as foreign jurisdictions become saturated with filings. For example, lawyers may try to take control of a case by moving for expedited proceedings in Delaware or they may try to complicate negotiations over the selection of lead plaintiffs’ counsel. The threat of using these tactics may increase the possibility that a plaintiff will receive some share of a fee award either in Delaware or in a case being litigated elsewhere.This article explores how the rules Delaware uses to manage deal cases may enable strategic behavior in the context of multi-jurisdictional litigation. This discussion provides reasons to believe that the use of tactics such as requesting expedited proceedings, contesting consolidation of cases, and involving out-of-state counsel earlier in proceedings should increase as multi-jurisdictional litigation increases. The empirical evidence provides substantial support for these theories. The article concludes with an assessment of how the observed increase in strategic tactics may affect debates over how and whether to respond to the rise of multi-jurisdictional litigation.

Damning Dictum: The Default Duty Debate in Delaware

Bizarrely, in 2013, even the most sophisticated business lawyer could not answer a seemingly simple question: whether, in the absence of an express agreement to the contrary, the manager of a Delaware limited liability company (LLC) owes traditional fiduciary duties to its members as a default matter? This was not always the case. For years, this question was settled — settled at least in the Delaware Court of Chancery. But in November 2012, the Delaware Supreme Court cast doubt on a long line of chancery court precedent in Gatz Properties v. Auriga Capital. Given the broad freedom of contract available under LLC law, it may be that default duties do not much matter. And, in any case, the uncertainty created by Gatz has now been resolved by recent legislation. Consequently, the lasting impact of Gatz is not on the substantive legal question. Rather, the lasting impact of Gatz is on Delaware law’s reputation for certainty as well as the use of dictum, an established Delaware judicial practice that has been vital to the state’s success in attracting corporate, and now LLC, charters.

A Theory of Preferred Stock

Should preferred stock be treated under corporate law as an equity interest in the issuing corporation or under contract law as a senior security? Should a preferred certificate of designation subsumed in the corporate charter and treated as an incomplete contract filled out by fiduciary duty, or should it be treated as a complete contract with drafting burden on the party asserting the right, as would occur with a bond contract? Is preferred equity or debt? This article shows that preferred is both corporate and contractual, neither all one nor all the other. It sits on a fault line between two great private law paradigms, corporate and contract law, and draws on both. The overlap brings two competing grundnorms to bear when interests of preferred and common stockholders come into conflict in decided cases: on the one hand, managing to the common stock, as residual interest holder, maximizes value, while on the other hand, holding parties to contractual risk allocations maximizes value. When questions arise concerning the relative rights of preferred and common, the norms hold out conflicting answers. Delaware courts have taken the lead in confronting these questions, seeking to synchronize the law of preferred stock with the rest of corporate law, a project that leads to both innovation and stress.This article examines recent preferred cases to show two facets of Delaware law coming to bear as the synchronization process proceeds - first, reliance on independent directors for dispute resolution, and, second, the common stock value maximization norm. There follows a tilt toward corporate norms that disrupts risks allocated in heavily negotiated transactions, particularly in the venture capital sector. Toward the end of restoring balance between the corporate and contract paradigms, the article makes three recommendations. First, the meaning and scope of preferred contract rights should be determined by courts rather than by issuer boards of directors. Second, conflicts between preferred and common should not be decided by reference to a norm of common stock value maximization. Enterprise value should be the referent, more particularly, maximization of the value of the equity as a whole. Third, independent director determinations of conflicts between preferred and common should not be accorded ordinary business judgment review. Instead, a door should be left open for good faith review tailored to the context — a showing of bad faith treatment of the preferred where the integrity of a deal has been undermined, burden of proof on the board.

Auction Theory and Standstills: Dealing with Friends and Foes in a Sale of Corporate Control

A fundamental issue in Delaware mergers & acquisitions (M&A) law is the extent to which a target company’s board of directors may restrict a sales process to extract value from bidders and grant a “winning bidder” certain deal protections to protect a transaction from being overbid. Standstill agreements are one such form of deal protection. Standstills prevent bidders from making or announcing a bid for the target without the target’s consent both during the sales process and for a period after the sales process is completed and the target has executed an agreement with a “winning bidder.” Recent 2011 and 2012 Delaware Court of Chancery rulings have placed a new spotlight on the use of standstill agreements in M&A deals and specifically in change of control transactions. In particular, these cases highlight the restrictiveness of some standstills and open up discussion as to how restrictive a standstill may be without violating a target company board of directors’ duty to maximize stockholder value. This Article makes a unique contribution because it is the first paper to apply auction theory in critiquing and evaluating the need for standstills in M&A transactions. Auction theory utilizes economics to design optimal bid-ding procedures and revenue enhancing auctions. The application of auction theory to standstills is particularly well suited as the execution of a standstill is often cited as resulting in increased value during the sales process. Using auction theory and recent Delaware case law as a foundation, this Article provides a new framework for the use of standstills. It argues that to the extent standstills provide an entry into the due diligence and general sales processes, standstills may help to enhance value. Moreover, the promise of standstill restrictions continuing post-signing may aid in incentivizing bidders to submit their highest offers during the pre-signing sale process. But the use of more restrictive standstills like those in which a bidder agrees not to request a waiver and a target agrees in advance not to waive a standstill (or Don’t Ask, Don’t Waive (DADW) standstills) should turn on whether strategic or financial bidders are involved in the process as well as the amount of pre-signing shopping of the target engaged in by the board. This Article provides a new framework for dealmakers and for courts taking into con-sideration those factors. Among other things, this framework suggests that if dealmakers are to continue their use of DADW standstills, that they be paired with a minimal fiduciary out and with a staggered termination fee.

Is Delaware Losing its Cases?

Delaware's expert courts are seen as an integral part of the state's success in attracting incorporation by public companies. However, the benefit that Delaware companies derive from this expertise depends on whether corporate lawsuits against Delaware companies are brought before the Delaware courts. We report evidence that these suits are increasingly brought outside Delaware. We investigate changes in where suits are brought using four hand‐collected data sets capturing different types of suits: class action lawsuits filed in (1) large M&A and (2) leveraged buyout transactions over 1994–2010; (3) derivative suits alleging option backdating; and (4) cases against public company directors that generate one or more publicly available opinions between 1995 and 2009. We find a secular increase in litigation rates for all companies in large M&A transactions and for Delaware companies in LBO transactions. We also see trends toward (1) suits being filed outside Delaware in both large M&A and LBO transactions and in cases generating opinions; and (2) suits being filed both in Delaware and elsewhere in large M&A transactions. Overall, Delaware courts are losing market share in lawsuits, and Delaware companies are gaining lawsuits, often filed elsewhere. We find some evidence that the timing of specific Delaware court decisions that affect plaintiffs' firms coincides with the movement of cases out of Delaware. Our evidence suggests that serious as well as nuisance cases are leaving Delaware. The trends we report potentially present a challenge to Delaware's competitiveness in the market for incorporations.

External Governance, Risk Taking and Outcomes: The Importance of CEO Career Concerns

We study the effects of multi-layered governance on firm risk by focusing on the interaction of two types of career concerns. Two Delaware court decisions, the validation of poison pill defenses (the Unitrin decision) implemented by staggered boards (the Wallace decision), reduced takeover-related career concerns. CEO age influences the response of Delaware firms to these shocks. Older CEOs in newly insulated firms reduce risk, while their younger counterparts increase risk. Ex-post, the differential behavior among young Delaware CEOs appears to be rewarded with abnormally positive stock performance and better future career outcomes. We conclude that there is important variation in the effects of governance on firm (CEO) behavior, driven by multiple facets of career concerns.

Journeys in Revlon-Land with a Conflicted Financial Advisor: Del Monte and El Paso

Two recent cases in the Delaware Court of Chancery, In re Del Monte Foods Co. Shareholders Litigation and In re El Paso Corp. Shareholders Litigation, concern potential breaches of target directors’ Revlon duties when the company’s financial advisor has a conflict of interest related to the potential transaction. This article analyzes these cases with a view to exploring two main issues: (a) how breaches of the financial advisor’s duty of loyalty as an agent can support a claim that directors have breached their Revlon duties even if their reliance on the agent was entirely innocent, and (b) how, under Revlon, the directors’ fully-informed decision to engage or retain a financial advisor with a fully-disclosed conflict of interest should relate to subsequent decisions that the board may make relying on advice from such an advisor.