Document: Icahn Partners LP v. Amylin Pharmaceuticals, Inc., C.A. No. 7404-VCN (Del. Ch. Apr. 20, 2012)
The Delaware Court of Chancery granted plaintiffs’ motion to expedite an action seeking to enjoin the enforcement of an advance notice bylaw in connection with the annual meeting of defendant Amylin Pharmaceuticals, Inc. (“Amylin”). Plaintiff Icahn Partners Master Fund LP and affiliates (collectively, “Icahn”) argued that Amylin’s board should be enjoined from enforcing the bylaw because Amylin radically altered the course of the company’s future and its stockholders’ expectations by rejecting, without considering, an acquisition proposal from Bristol-Myers Squibb Company (“Bristol-Myers”) after the advance notice deadline had passed. According to plaintiffs, the outlook for the company had been tied to securing a value-maximizing transaction, and Amylin’s stockholders would be irreparably harmed if they were denied the opportunity to vote on a slate of directors that would pursue a potential sale of the company at a premium. The defendants argued, inter alia, that plaintiffs had not stated a claim for breach of fiduciary duty and therefore the action should not be expedited. The Court found that the narrow issue on the motion for expedite was not whether the board was structurally unassailable, but whether the board’s refusal to engage in negotiations with Bristol-Myers was so misaligned with the expectations of Amylin’s stockholders that it warranted the reopening of the nomination process. The Court found that plaintiffs had met their burden of proof and expedited the action.