“[L]ike mushrooms follow[ing] the rain,” Dias v. Purches, 2012 WL 4503174, at *5 (Del. Ch. Oct. 1, 2012), within weeks (and often days) after a publicly traded company announces a merger or acquisition, one or more shareholders of the target company sues the target’s board of directors for breach of fiduciary duty and threatens to enjoin the proposed transaction. See Robert M. Daines & Olga Kourmrian, Recent Developments in Shareholder Litigation Involving Mergers and Acquisitions: March 2012 Update (Cornerstone Research, 2012) at 5 (reporting that, in 2011, 39 percent of shareholder lawsuits were filed within 7 days after a deal was announced, and approximately two-thirds were filed within 14 days). In 2007, the percentage of announced deals (valued at or above $500 million) subject to shareholder litigation was 53 percent. By the end of 2009, that percentage jumped to 92 percent. Since then, shareholders continue to target almost every public acquisition, resulting often in multiple lawsuits in multiple jurisdictions with respect to the same deal. The average number of lawsuits filed per deal continues to rise.
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