| Paramount Communications, Inc. v. QVC Network, Inc. | |
| Court: | Supreme Court of Delaware |
| Full Name: | Paramount Communications, Inc., Viacom Inc., Martin S. Davis, Grace J. Fippinger, Irving R. Fischer, Benjamin L. Hooks, Franz J. Lutolf, James A. Pattson, Irwin Schloss, Samuel J. Silberman, Lawrence M. Small, and George Weissman v. QVC Network Inc. (In re Paramount Communications Inc. Shareholders' Litigation) |
| Date Decided: | February 4, 1994 |
| Citations: | 637 A.2d 34 (Del. 1994) |
| Judges: | E. Norman Veasey, Chief Justice, Andrew G. T. Moore II & Randy J. Holland, Justices |
In Paramount Communications, Inc. v. QVC Network, Inc., 637 A.2d 34 (Del. 1994), the Delaware Supreme Court clarified the type of transaction that triggers Revlon duties.
This case, an appeal from a decision of the Delaware Chancery Court, involved a proposed merger between Viacom and Paramount Communications; as part of the merger agreement, Paramount agreed to an array of defensive measures, including a no-shop provision, $100 million termination fee and a lock-up option on approximately 20% of Paramount’s common stock. However, QVC intervened with its own, facially more generous merger proposal, conditioned on cancellation of the defensive measures. The Paramount board refused to conduct a formal bidding process with QVC on the grounds that it would be inconsistent with its contractual obligations to Viacom.
The court found that,