Delaware Court of Chancery Holds That Pre Merger Attorney-Client Privilege Passes to the Surviving Corporation in a Merger

The Delaware Court of Chancery recently ruled that, absent express contractual provisions to the contrary, control of a target company’s pre-merger attorney-client communications transfers to the surviving corporation in a merger pursuant to Section 259 of the Delaware General Corporation Law. As a result, parties to a merger should discuss the intended treatment of the attorney-client privilege with respect to pre-merger communications and, if necessary, reflect their desired arrangements in the transaction documentation.

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