In re KKR Fin. Holdings LLC Shareholder Litig.

In 2004, KKR & Co. LP (KKR) acquired KKR Financial Holdings LLC (KFN) in a stock-for-stock merger. Plaintiffs, stockholders of KFN, challenged the merger by filing a class action complaint, asserting breach of fiduciary duty claims against the members of the KFN board and KKR. The Court of Chancery dismissed the action for failure to state a claim for relief, holding (1) Plaintiffs’ fiduciary duty claim against KKR premised on the theory that KKR was a controlling stockholder of KFN failed, as KKR did not control the board of KFN when it approved the merger; and (2) Plaintiffs’ fiduciary duty claim against the directors of KFN failed because the board’s approval of the merger was subject to business judgment review. View "In re KKR Fin. Holdings LLC Shareholder Litig." on Justia Law