In Re Lear Corp. Shareholder Litigation

OPINION

STRINE, Vice Chancellor.

I. Introduction

In this case, stockholder plaintiffs seek to hold the board of Lear Corporation (“Lear” or “the company”) responsible in damages for agreeing to pay a bidder a termination fee payable upon a no vote on a merger in exchange for that bidder increasing its bid from the original merger agreement by $1.25 per share (“the Merger”). The bidder did not face competition from a rival bidder; in fact, Lear had been fully shopped, and no topping bid had emerged. Rather, in a frothy M & A market, stockholders perceived that the original merger price of $36 per…