Paramount Communications Inc. v. QVC Network Inc.
Delaware Supreme Court
637 A.2d 34 (Del. 1994)
Paramount Communications Inc. (Paramount) (defendant) approved a merger agreement with Viacom Inc. (Viacom). The agreement contained various defensive measures, including the following: a no-shop provision, under which Paramount would not solicit any other offers, subject to certain exceptions; a termination fee provision, under which Viacom would be paid a $100 million termination fee if the merger was not consummated; and a stock option provision under which Viacom was granted an option to purchase about 19.9 percent of Paramount’s outstanding stock if the merger was not consummated. After the proposed merger was announced, QVC Network Inc. proposed an alternative merger to Paramount, whereby QVC would acquire Paramount for $80 per share. Upon hearing of this offer, Viacom sweetened its bid for Paramount, itself offering $80 per share. Paramount approved an amended merger agreement with Viacom, although the terms were largely similar to the original agreement and the defensive measures in place to make it hard for Paramount to effectuate an alternative transaction remained unchanged. Subsequently, Viacom unilaterally raised its offer to $85 per share and QVC followed with an offer of $90 per share. The Paramount board then made a final determination that the Viacom merger was in the better interests of the Paramount stockholders. QVC and Paramount stockholders (plaintiffs) brought suit and the Court of Chancery granted a preliminary injunction enjoining the Paramount merger with Viacom. Paramount appealed.
Rule of Law
Holding and Reasoning (Veasey, J.)
What to do next…
Unlock this case brief with a free (no-commitment) trial membership of Quimbee.
You’ll be in good company: Quimbee is one of the most widely used and trusted sites for law students, serving more than 97,000 law students since 2011. Some law schools—such as Yale, Vanderbilt, Berkeley, and the University of Illinois—even subscribe directly to Quimbee for all their law students. Read our student testimonials.
Learn more about Quimbee’s unique (and proven) approach to achieving great grades at law school.
Quimbee is a company hell-bent on one thing: helping you get an “A” in every course you take in law school, so you can graduate at the top of your class and get a high-paying law job. We’re not just a study aid for law students; we’re the study aid for law students. Read more about Quimbee.
Here's why 153,000 law students have relied on our case briefs:
- Written by law professors and practitioners, not other law students. 13,400 briefs, keyed to 183 casebooks. Top-notch customer support.
- The right amount of information, includes the facts, issues, rule of law, holding and reasoning, and any concurrences and dissents.
- Access in your classes, works on your mobile and tablet. Massive library of related video lessons and high quality multiple-choice questions.
- Easy to use, uniform format for every case brief. Written in plain English, not in legalese. Our briefs summarize and simplify; they don’t just repeat the court’s language.