United Rentals, Inc. v. RAM Holdings, Inc.
Court of Chancery of Delaware
937 A.2d 810 (2007)
United Rentals, Inc. (URI) (plaintiff) is an equipment rental company that sought to merge with Cerberus, a private equity firm. URI’s counsel, Eric Swedenburg, negotiated the terms of the merger with Peter Ehrenberg, counsel for RAM Holdings, Inc. and RAM Acquisition Corp. (RAM) (defendants). Swedenburg clearly communicated to Ehrenberg that it was a priority for URI to have a mechanism to seek specific performance of the merger, and drafted the merger agreement accordingly. Upon reviewing the draft agreement, RAM returned a draft specifically striking provisions that gave URI the right to specific performance. Ehrenberg also consistently communicated to Swedenburg RAM’s understanding that Cerberus had a right to refuse to close the deal for $100 million and that URI did not have a right to specific performance under the agreement. Moreover, Ehrenberg made clear to Swedenburg that Cerberus’ principals would not move forward unless they were assured that Cerberus had the option of walking away from the deal by paying a penalty. In the finalized contract, Section 9.10 provided URI with the right to seek specific performance, subject to Section 8.2(e) of the contract. Section 8.2(e) in turn provided that the exclusive remedy upon breach would be a penalty of $100 million payable to URI, and expressly precluded the right to seek equitable relief or to seek money damages in excess of the $100 million penalty. In November 2007, URI brought suit against RAM. URI moved for summary judgment and sought an order specifically enforcing the merger agreement.
Rule of Law
Holding and Reasoning (Chandler, 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 166,000 law students have relied on our case briefs:
- Written by law professors and practitioners, not other law students. 13,800 briefs, keyed to 187 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.