2023 securities, shareholder, and M&A litigation outlook

In the latest edition of our securities, shareholder, and M&A litigation outlook for 2023, we analyze key developments from 2022 and discuss how the most important cases from Delaware may impact companies now and in the year to come.

We have observed the following themes in Delaware courts, which we expect to continue in 2023:

The boundaries of Caremark Appraisal actions under Section 262;

The “entire fairness” standard related to several M&A transactions;

SPAC-related litigation generated several decisions;

An exploration of the bounds of equity; and

The impact of liquidation and insolvency on core issues

Below is an excerpt of the outlook for 2023 from our publication, which also includes an executive summary and coverage of key decisions from 2022 in Delaware courts.

The outlook for 2023

In this past year, we saw an uptick in in-person court proceedings as the effects of the pandemic subsided, a decrease in pandemic-related litigation, and a return to many of the core issues facing Delaware companies operating nationally and internationally in an increasingly challenging economy.

The Delaware Court of Chancery continued to contend with high case volume, issuing numerous game-changing opinions while continuing to churn out important commentary on critical issues of Delaware law. Over the past year, our coverage has highlighted five trends.

  • Delaware courts continued to define the boundaries of Caremark claims following the Delaware Supreme Court’s decision in Marchand v. Barnhill in 2018.
  • Delaware courts applied its strictest standard, the “entire fairness” standard, to several M&A transactions that involved individuals and entities receiving unique benefits not given to the other participants in the deal.
  • Special purchase acquisition company (SPAC)-related litigation generated several decisions, some relying on traditional principles to decide familiar issues, and some breaking new ground.
  • In two notable opinions, Delaware courts explored the bounds of equity, in one instance using equitable powers to craft an unprecedent remedy, and in another noting that, at times, the legally mandated outcome is inherently inequitable.
  • Delaware courts opined on several interesting issues related to the impact of liquidation and insolvency on core issues such as asset transfers, delinquency proceedings, and whether a custodian appointed under the DGCL could revive, rather than liquidate, an abandoned company.

In addition, 2022 brought a number of other notable opinions addressing a variety of issues, including appraisal, forum selection, “ordinary course” covenants, “sandbagging,” special committees, and discovery in foreign jurisdictions. More detail on all of these trends and cases can be found below.

Looking to 2023, we anticipate that Caremark will continue to be an area of focus for Delaware courts. Indeed, less than a month into 2023, the Delaware Court of Chancery issued an opinion in In re McDonald’s Corporation Stockholder Derivative Litigation confirming that officers have Caremark oversight responsibilities. In addition, ESG issues continue to be top of mind for companies. These issues likely will lead to additional litigation, including Caremark litigation and books-and-records claims. And, while there were fewer SPAC IPOs in 2022 than in 2020 or 2021, there remains a high likelihood of SPAC-related litigation in 2023 as the periods for de-SPAC transactions reach expiration. Finally, economic turmoil may lead to increased litigation as companies contend with uncertainty and distressed situations.

Click the image below to view the full outlook.


Authored by Allison M. Wuertz, Jon Talotta, William (Bill) M. Regan, David R. Michaeli, Elizabeth (Lizzie) Cochrane, Maura Allen, Shannon Zhang, Jocelyn Hassel,  Jack Shaked, and Tyler Waywell.

Allison Wuertz
New York
David Michaeli
New York
Jon Talotta
Global Co-Lead
Northern Virginia
William Regan
New York


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