City of Miami General Employees' & Sanitation Employees' Retirement Trust v. Comstock

IN THE SUPREME COURT OF THE STATE OF DELAWARE

CITY OF MIAMI GENERAL EMPLOYEES’ §
AND SANITATION EMPLOYEES’ § No. 482, 2016
RETIREMENT TRUST, on behalf of itself and §
on behalf of all others similarly situated, § Court Below: Court of
§ Chancery of the State of

Plaintiff Below, § Delaware

Appellant,
C.A. No. 9980
v.

JERRY M. COMSTOCK, JR., as lndependent
Executor of the Estate of Joshua E. Comstock,
RANDALL C. MCMULLEN, DARREN M.
FRIEDMAN, ADIANNA MA, MICHAEL
ROEMER, C. JAl\/[ES STEWART, III, H.H.
“TRIPP” WOMMACK, III, TI-IEODORE
“TED” MOORE, NABORS INDUSTRIES
LTD., and MORGAN STANLEY & CO. LLC,

Defendants Below,
Appellees.

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Submitted: March 1, 2017
Decided: March 23, 2017

Before STRINE, Chief Justice; HOLLAND, VALIHURA, VAUGHN, and
SEITZ, Justices, constituting the Court en Banc.

O R D E R
This 23rd day of March 2017, We affirm largely on the basis of the
decision of the Court of Chancery dated August 24, 2016.1 There are two

grounds on Which We do not fully embrace the Court of Chancery’s reasoning

1 Cz'ty of Mz`ami Gen. Employees v. Comstock, 2016 WL 4464156 (Del. Ch. Aug. 24, 20l6).

but agree With its ultimate result, given the arguments and record presented to
it. To wit, on appeal, the plaintiff has sharpened its disclosure arguments on
two points in order to give more substance to those arguments than it provided
to the Court of Chancery. Even With this sharpening, however, the plaintiff
failed to show that the two omitted items were material, in view of the
undisputed record that the go-shop process involved a broad outreach to every
plausible bidder, the investment bank running the go-shop process had a large
incentive to get a superior deal, and the plaintiff has failed to plead facts
supporting a rational inference that the one bid made Would have been
regarded as material. The plaintiff has pled no fact supporting the inference
that the one bid Was financially superior, much less that the bidder Was Willing
to raise its bid to a level that Was in fact superior to the Nabors deal. Although
the plaintiff has done a far better job on appeal than below, that is problematic
in itself. Ultimately, the allegations of the complaint are What are relevant to
our analysis, and the complaint does not contain pled facts supporting

inferences that the proxy statement Was materially misleading

NOW, THEREFORE, IT IS ORDERED that the judgment of the Court
of Chancery is hereby AFFIRMED. The period for filing a motion for
reargument is shortened to five days.2

BY THE COURT:

A-%g/¢¢{...QLA»

Justice

2 Supr. Ct. R. 18.