Delaware

Review

Dispute resolution
Abrams & Bayliss

Formed in 2005 as Abrams & Laster, Wilmington boutique Abrams & Bayliss has staked a firm claim in the community, placing itself on equal footing with the more historically established shops. In fact, some actually consider the firm to be in an advantageous position to overtake those firms. “There is a generation of lawyers in Delaware that are 20 years senior to those at Abrams & Bayliss that for the past 20 years have dominated Delaware. Well, those people are ready to retire! That puts a firm like Abrams & Bayliss, who has a consistently strong bench of people in their 40s and 50s, ready to take over from those other firms who had one major star and no one else because they didn’t groom the younger partners.” The firm is also said to be “very selective with its associates.” A peer offers in summation, “Abrams & Bayliss is terrific, incredibly plugged into the Delaware space. They don’t do as much in the federal space but in Delaware they are second to none.” 
     Thompson Bayliss has emerged as the firm’s “leading light” in recent years, enjoying a well-earned ascent in profile due to his raft of commercial Chancery litigation in both the plaintiff and defense capacities. “He just got a $600-something million verdict from Chancellor Laster [a firm founder and former partner, now on the Delaware Court of Chancery.] It’s in this weird niche MLP [master limited partnership] space. It’s on appeal, of course, but if it sticks, Tom could just retire! This verdict, with an actual amount of $690 million, was secured in November 2021 for former investors of Boardwalk Pipeline Partners who claimed they were short-changed in a July 2018 buyout. Loews, which controlled Boardwalk's general partner, was found to have breached Boardwalk’s partnership agreement in exercising its right to buy out the limited partners, and the Chancery Court found that the buyout did indeed undervalue the limited partners’ stake by 31%, and that they deserved $17.60 per unit instead of the $12.06 they were awarded. The case is currently on appeal to the Delaware Supreme Court, but Bayliss’s remarkable triumph for the plaintiff investors – achieved in a solo capacity and not acting as simply Delaware counsel for a larger firm – catapults Bayliss into his debut position in the coveted Top 100 Trial Lawyers list in this edition of Benchmark. Beyond Bayliss, Michael Barlow is said to be increasingly developing a name for himself. “He has such a strong relationship with firms like Quinn Emanuel,” notes a peer, “and they are calling on his services more and more.” 

Bernstein Litowitz Berger & Grossmann

Bernstein Litowitz is an undisputed leader in the securities-focused plaintiff arena. Peers on both the same and opposite sides of the “V” offer plaudits and admiration on a near-unanimous basis. “Bernstein is always at the top,” declares a peer, voicing a general consensus. “They are one of the few firms in this capacity that files the big, meaty securities cases, and they litigate them hard. Theyre not just ‘first-to-filers’ trying to get out as quickly as possible with a weak settlement.” Another peer concurs: “We see Bernstein Litowitz a lot but only in the bigger casesthey are more selective. 

     Historically a New York-based institution positioned as “an attack dog for Wall Street,” the firm has also attended to a Delaware practice, a stance that the firm cemented when it recently opened an office in Wilmington and installed Greg Varallo to run it. Varallo, long known to the Delaware Chancery community as a defense lawyer at Wilmington institution Richards Layton & Finger, raised eyebrows and had the legal market talking when he “flipped sides.” A local peer confirms, “Greg is well known and well-liked by everyone in the Chancery community. He’s got a certain charisma and credibility.” A New York partner familiar with Varallo notes: “Greg did really well in a Gilead case – he got sanctions against the company that refused to produce documents!” The firm’s foray into the Delaware market is viewed as “smart and enormously successful,” in the eyes of peers. “There is a lot of action in Delaware nowadays, and plaintiffs know this, so to bring these actions in Delaware without having your own counsel here… I can’t imagine what the cut would be to hire Delaware counsel, but it would be big,” opines one Wilmington peer. “With Bernstein coming in here, they have not only won big within their own confines but have also pretty much put a few of the more historic Delaware plaintiff shops out to pasture.” 

     While based in the firm’s New York flagship office,Mark Lebovitchis also known for a Delaware element to his practice, which frequently involves derivative actions and often teaming up with Varallo. “If youre a Delaware company, you are getting hit with a 220 demand,” states a peer, “and Mark ‘The Maestro’ Lebovitch is all over this. He is getting really aggressive, pushing for emails and text messages from company directors. Typically, that is not where discovery happens – it usually has to be on company-related documents – but Mark is saying, ‘Nah, listen – cell phones, personal emails, executives now frequently use these channels to communicate, and I want to see what’s happening on those channels.’ He is getting increasingly successful in convincing judges to allow this!Lebovitch and Varallo represented the Hollywood Firefighters’ Pension Fund in successfully stopping GCI Liberty’s and Liberty Broadband’s controlling stockholders from using complex financial engineering in a merger of the two companies to consolidate their voting power at the expense of GCI Liberty’s public Class-A stockholders. The litigation caused the controllers to unwind all of the personal benefits they had sought for themselves while securing a $110 million cash settlement for former GCI Liberty stockholders.MarkLebovitchis strategic,” declares a peer, elaborating, “He doesn’t swing at every ball, he knows when to push. He is in a lot of securities cases right now – he’s in the Peloton securities class action! 

     Peers note that the firm’s center of gravity, Max Berger, is “still the king when it comes to standing up and getting the settlements, but others are doing the heavy liftingHannah Ross, for one.” Berger and Ross initiated a comprehensive, proprietary investigation in the wake of the collapse of the Allianz Structured Alpha funds during the beginning of the pandemic. The investigation focused on alleged misconduct and breaches of fiduciary and contractual duties in the management of those funds, which had deviated from their stated market-neutral strategy. As a result of this, the Bernstein Litowitz team managed to secure settlements between February and April 2022 totaling nearly $2 billion to the firm’s clients. Sal Graziano, one of the firm’s most active litigators, scored a $175 million settlement in September 2021 on behalf of investors in Luckin Coffee, a Chinese coffee chain that received well-publicized infamy for being fraudulent.

     Beyond the senior level, more junior partners are making their mark. Newly listed future star Edward Timlin is tipped by peers as one to watch. “Ed trained under [universally revered securities litigator] Adam Hakki and got defense expertise from this development at Shearman [& Sterling]. [He is] definitely worth keeping your eye on.” 

Labaton Keller Sucharow

Plaintiff shop Labaton Sucharow continues to stick to its historic roots as a securities boutique, although in recent years, the firm has broadened its scope to take on antitrust and privacy issues with the same formidable resolve. Corroborating the firm’s expansion, a peer advises, “Look closer – Labaton is getting more into the consumer class-actions space as well, particularly with privacy and data breach work.” The firm is strategically placed in the financial district of New York as well as in Wilmington, Delaware and Washington, DC, where it is well poised to feed heartily on a steady diet of corporate disputes arising on Wall Street and in the Delaware Court of Chancery. As far as its prized securities practice, the firm remains at the top echelon, as a defense-side peer says, “Labaton is one of the few plaintiff firms that get the big, meaty securities cases and they litigate them.”

     Elevated to Litigation Star status this year and recognized as a National Practice Area Star in securities as well, Carol Villegas is lauded for her “grit and talent” and denoted by a market peer as “the one who’s very prominent [at Labaton].”  Villegas serves as the youngest team leader in the firm’s history, spearheading the burgeoning Consumer Protection and Data Privacy Practice. In the privacy space, she serves as co-lead class counsel in their case alleging violations of privacy rights and related statutes against Flo Health, a women's health app developer that allows users to track data such as fertility and menstruation. While Villegas is trailblazing through the privacy and consumer protection litigation, she continues to be a pillar of the plaintiff-side securities bar. She is currently serving as co-lead counsel in a securities lawsuit filed against payment platform giant PayPal after it revealed that its “net new active” accounts were artificially inflated and illegitimately created by employees and “bot farms,” leading to a drop in stock prices. Villegas recently filed an Amended Complaint. In a case that was recently resolved, she defeated the defendant Uniti’s motion to dismiss and prevailed also on its motion for reconsideration. After filing a motion for class certification during discovery, Uniti settled for $38,875,000. Villegas and fellow star of the New York office Michael Canty are lead counsel to the Public Employees Retirement Association of New Mexico in a securities action against California’s utility provider, PG&E. The leading partners had to adjust their strategy when the company filed for bankruptcy in the Northern District of California. Pivoting to bankruptcy proceedings, Villegas and Canty objected to and resolved unfavorable terms on behalf of the lead plaintiff and the putative class in the Plan of Reorganization. Their efforts preserved the claims of the putative class and at one point, extended the deadline for claimants after the defendants failed to provide proper notice to file a claim. Canty leads the trial representing Caprenters Pension Trust for Northern California and the Carpenters Annuity Trust Fund for Northern California, among others, in a securities class action filed against Allstate, the company’s CEO and its former President of Allstate Protection. The case arises from the company’s alleged growth strategy that ultimately led to relaxed underwriting standards which caused claims to increase.  Canty laid the ground before trial with several critical victories, including prevailing against the defendants’ motion to dismiss, class certification, and defeating the defendants’ motion to exclude the opinions of his experts.  

    James Johnson, a more senior partner in the New York office, lays claim to several key victories of his own. He serves as co-lead counsel in a closely watched battle with Goldman Sachs arising from its concealment of misconduct involving multiple collateralized debt obligations shorting the mortgage market ahead of the 2008 financial crisis. The long-running case dates back to June 2012 when the district court denied Goldman’s motion to dismiss, leading to the class certification in 2015. After interlocutory appeal, a remand order from the Second Circuit, and another class certification granted in 2018, the Second Circuit published an opinion affirming the class certification in 2020. In June 2021, the Supreme Court further affirmed the class certification, but clarified the legal standards involved in deciding price impact at the class certification stage. The case was remanded to the Second Circuit, which remanded the case to the district court. The class was certified for a third time, and the case went before the Second Circuit again. Oral arguments took place in September 2022.

     One of Labaton’s biggest accomplishments as of late has been the rising profile of the firm’s Delaware practice. This has largely been attributed to the efforts of Ned Weinberger, a partner who has made a splash in the Delaware market and has had the community talking. “Ned is one of the leaders,” confirms one Wilmington peer. “There are no shortcuts in Delaware – you have to earn your way up through the peers and judiciary. Ned has gotten appointed lead counsel on several cases, important cases, over people from several other plaintiff firms that are more established in Delaware!” Another peer adds, “Courts love him, he’s an aggressive litigator who gets results.” His status has succeeded against the established names, as one remarks, “These days, he has very quickly risen up to the position of being my first or second call if I needed to refer a case to a plaintiff. I would choose him over more established plaintiffs in Delaware, who are older and fading.” In a high-profile case watched closely by the Delaware market, Weinberger served as co-lead counsel against controlling stockholders of Dell, alleging they had breached their fiduciary duties by expropriating billions of dollars in value from Dell’s Class V Stockholders. He prevailed on the defendants’ motion to dismiss the second amended complaint. In the fourth amended consolidated complaint filed, Weinberger and the great plaintiffs’ team added Goldman Sachs as a defendant, alleging aiding and abetting claims. Weinberger engaged in fact and expert discovery, and three weeks before the trial, the defendants settled, and the proposed settlement hearing was scheduled for April 2023. Weinberger has been at trial representing minority shareholders of Straight Paith in a lawsuit arising from the company’s merger with Verizon. The plaintiffs allege that the controlling shareholder, Howard Jonas, breached his fiduciary duty after his actions caused shareholders to lose hundreds of millions of dollars. Delaware Court of Chancery Vice Chancellor Glasscock denied the defendants’ motion to dismiss, which was affirmed by the Delaware Supreme Court in 2019. The defendants IDT and Jonas filed motions for summary judgment involving the indemnification agreement between IDT and Straight path; their motions however were denied. The trial was set in two phases, and the parties have been engaged in post-trial briefings.

Ross Aronstam & Moritz

Wilmington corporate and commercial litigation boutique Ross Aronstam & Moritz has edged its way into a position at the forefront of the crowded Delaware community, earning “a top seat at the table” among larger, older and more established institutions. “Ross Aronstam has come a long way,” confirms a local peer, “and they did it fast! We are all watching them and respect them equally.” The firm has even earned acclaim from out-of-town firms, several of whom are themselves widely championed brand-name “white shoe” firms who have partnered with Ross Aronstam. “A lot of ‘big law’ firms have this high-handed attitude in Delaware,” elaborates one peer. “They come in and go, ‘I respect your opinion, and I want to hear what you have to say, but ultimately, it’s our case. This is a BIG MISTAKE! Judges in Delaware spot it immediately and hate it. But Ross Aronstam is one firm I have never witnessed this happening to! They get immediate respect, and I don’t just think it’s luck - I think that alone speaks volumes as to their reputation.” Indeed, the firms calling on Ross Aronstam’s services as Delaware counsel read like a “who’s who” of blue-ribbon big law and out-of-town litigation boutiques, and the cases the firm handles illustrate a broad cross section of commercial and Chancery disputes.
      All three name partners are namechecked by peers. David Ross is called “the one l would go with for case strategy, if I had to choose only one lawyer in Delaware. He also knows the bench really well.” Ross provides lead counsel to Facebook in several matters. In one, he represents the company and its current and former officers and directors in a purported derivative action seeking to recover based upon alleged issues concerning advertising metrics, competitive practices, and executive compensation. Ross is also co-counsel to Facebook in connection with various litigations arising out of the well publicized Cambridge Analytica privacy breach scandal, including derivative actions and actions seeking to inspect company books and records. In another of his (non-Facebook-related) matters, Ross represents Swipe Acquisition Corporation, the acquirer in action asserting fraud arising out of a substantial indirect acquisition by a fund advised by Platinum Equity Advisors. Bradley Aronstam is attending to novel matters in the rapidly burgeoning SPAC area; in one such matter, he is partnering Weil Gotshal & Manges in representing Churchill Capital Corp III and the former directors of Churchill in consolidated stockholder litigation challenging Churchill’s SPAC acquisition of MultiPlan Corp. Garrett Moritz is attending to a diverse basket of matters straddling several practices. He acts with Cravath in representing the directors of Tesla in stockholder litigation challenging Tesla’s acquisition of SolarCity in a stock-for-stock transaction that valued SolarCity at approximately $2.6 billion to $2.8 billion. Shortly before trial, the director defendants other than Elon Musk reached an agreement in principle, subject to court approval, to settle for $60 million to be funded by insurance. Trial was set to proceed in the Court of Chancery in March 2020 with respect to Elon Musk but was delayed due to the COVID-19 crisis. Trial moved scheduling to July 2021. In a more commercial-related matter, Moritz acts with Gibson Dunn & Crutcher in representing Keurig Dr. Pepper affiliate The American Bottling Company in litigation against BA Sports Nutrition, LLC and the Coca-Cola Company for wrongful termination of a distribution contract with The American Bottling Company to distribute the sports drink Bodyarmor in order to wrongfully move distribution to Coca-Cola. ABC’s contract and tortious interference claims seeking to recover hundreds of millions of dollars or more in losses have survived a motion to dismiss. The case is currently in discovery, with a jury trial scheduled for February 2022 in Delaware Superior Court. In a derivative matter concerning corporate governance, Moritz represents McDonald’s in a lawsuit against McDonald’s former CEO Stephen Easterbrook for breach of fiduciary duty and fraudulent inducement. The case arises from McDonald’s discovery - after entering into a Separation Agreement with the Easterbrook after learning that he had engaged in a sexual relationship with a subordinate - that Easterbrook had lied about the existence of other sexual relationships with other Company employees during an internal investigation, and that Easterbrook had approved an equity grant to one of the employees, in violation of Company policy. In February 2021, the Court of Chancery denied Easterbrook’s motion to dismiss. The case is currently in discovery and trial is expected to be held in mid-2022.