IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
IN AND FOR NEW CASTLE COUNTY
ALAN R. KAHN, as custodian for )
Amanda Kahn and Kimberly Kahn, 1
Plaintiff, 1
V. ,' Civil Action No. 8748
LYNCH COMMUNICATION SYSTEMS, i
INC., COMPAGNIE GENERALE
D'ELECTRICITE, ALCATEL, S-A., ;
ALCATEL USA CORP., E. F.
DERTINGER, STUART! M. BERINGER, ;
FRANK M. DRENDEL, RAYMOND HONO,
HUBERT L. KERTZ, FRANCOIS H. )
de LAAGE de MEUX, JAMES B. 1
SANDERS, JAMES H. VOGT, PAUL B. )
WINEMAN, JOHN GAILEY and GILLES)
DuPAY-d'AGEAC, 1
Defendants. 1
MEMORANDUM OPINION
Date Submitted: April 21, 1988
Date Decided: August 24, 1989
R. Bruce McNew, Esquire and Pamela S. Tikel:Lis, Esquire of
GREENFIELD & CHIMICLES, Wilmington, Delaware and Sidney B.
Silverman, Esquire of SILVERMAN & HARNES, New York, New York,
Attorneys for Plaintiff
Allen M. Terrell, Jr., Esquire, Nathan 13. Ploener, Esquire and //
Robert J. Shaughnessy, Esquire of RICHARDS, LAYTON & FINGER,
Wilmington, Delaware, Attorneys for Defendants
BERGER, Vice Chancellor
This is the decision on a motion to dismiss a purported
class action challenging the merger of Lynch Communications
Systems, Inc. ("Lynch"), with a subsidiary of Alcatel USA
Corp. ("Alcatel") . The remaining individual defendantsl, who
are directors o:E Lynch, and the corporate defendants Lynch,
Alcatel, Alcatel, S.A. and Compagnie Genera:Le d'Electricite
("CGE") , seek dismissal on the ground that plaintiff's exclu-
SNIPPETS:
IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
INC., COMPAGNIE GENERALE D'ELECTRICITE, ALCATEL, S-A.,; ALCATEL USA CORP., E. F. DERTINGER,
R. Bruce McNew, Esquire and Pamela S. Tikel:Lis, Esquire of GREENFIELD & CHIMICLES,
Ploener, Esquire and // Robert J. Shaughnessy, Esquire of RICHARDS, LAYTON & FINGER,
class action challenging the merger of Lynch Communications
are directors o:E Lynch, and the corporate defendants Lynch,
seek dismissal on the ground that plaintiff's exclusive remedy is appraisal under 8 Del.
S.A. and CGE seek dismissal on the alternative ground
that this Court lacks personal jurisdiction over them.
The facts, as alleged in the Amended Complaint, may be summarized as follows.
is a Delaware corporation engaged in the business of designing, manufacturing and selling
'Three Lynch directors who served on the independent committee had been named as defendants
On August 1, 1986, at a Lynch board of directors meeting, Alcatel allegedly recommended that
Lynch and Celwave Systems, Inc., another whollyafter the study had been completed, Alcatel
"series of proposals" that culminated in a tender offer and
causing the merger at an unfair price and .for an improper
Plaintiff also alleges that the
The difference here, according to plaintiff, is
We are saying that the Lynch-Celwave consolidation study, which we paid for, showed that
Supr., 457 A.2d 701.
I cannot endorse any general statement that a controlling stockholder, having proposed one
these allegations "import a form of overreaching,
began the negotiations over the consolidation and then withdrew from those negotiations.
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