IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE

Sunrise Partners Limited Partnership,

Petitioner,

v.

Rouse Properties, Inc.,

 Respondent.

C.A. No. 12609-VCS

Hudson Bay Master Fund Ltd.,

Petitioner,

v.

Rouse Properties, Inc.,

 Respondent.

C.A. No. 12611-VCS

DBW Lycurgus LLC,

Petitioner,

v.

Rouse Properties, Inc.,

 Respondent.

C.A. No. 12617-VCS

Levcap Alternative Fund, LP; Ulysses 

Offshore Fund LTD; Ulysses Partners LP; 

David Levin 1992 Trust (a/k/a Trust 

U/A/D 12/4/92 FBO David J. Levin); 

HAL 63 Partnership – PW (a/k/a HAL 63 

C.A. No. 12674-VCS

EFiled: Dec 08 2016 04:13PM EST 

Transaction ID 59932209

Case No. Multi-Case
Partnership, L.P.); The David J. Levin 

2002 Trust; Maxwell Chase Levin Trust; 

Zachariah Nicholas Levin Trust dated 

December 28, 2010 (a/k/a Zachariah 

Nicholas Levin Trust); The David Levin 

2001 Trust (a/k/a The David J. Levin 

2001 Trust); Sophie Valentine Chiara 

Trust U/W Judith Chiara Dated N (a/k/a 

Sophie Valentine Chiara Trust U/W 

Judith L. Chiara); Julian Arthur Chiara 

Trust UWO Judith Chiara Dated Nove 

(a/k/a Julian Arthur Chiara Trust U/W 

Judith L. Chiara); Christopher Evan Beaty 

Trust UWO Judith Chiara Dated No 

(a/k/a Christopher Evan Beaty Trust U/W 

Judith L. Chiara); Trust U/A/D 10/11/63 

FBO Louise P. Belsky (a/k/a Trust U/A/D 

10/11/63 Louise P. Belsky); The Jean L. 

Troubh Trust U/A/D 12/18/89; Trust 

U/A/D 10/11/63 FBO Elisabeth P. Doyle; 

Lucas Marco Chiara Trust UWO Judith 

Chiara Dated Novemb (a/k/a Lucas 

Marco Chiara Trust U/W Judith L. 

Chiara); Trust U/W Judith L. Chiara FBO 

Ryan Thomas Beaty (a/k/a Ryan Thomas 

Beaty Trust U/W Judith L. Chiara); 

Kristin Beaty Paszkiewicz Trust UWO 

Judith Chiara Dated (a/k/a Kristin Beaty 

Paszkiewicz Trust U/W Judith L. Chiara); 

Karma Alexander Mason Trust UWO 

Judith Chiara Dated Nov (a/k/a Karma 

Alexander Mason Trust U/W Judith L. 

Chiara); Jean L. Troubh Family 2000 

Trust; Audrey S. Levin; Jessica Perry 

Fertig Trust UWO Judith Chiara Dated 

Nove (a/k/a Jessica Perry Fertig Trust 

U/W Judith L. Chiara); Benet Polikoff 

and Margaret Polikoff Trust; 1/3/55 Trust 

U/W Carl M. Loeb FBO Jean L. Troubh –

PW (a/k/a Trust U/W Carl M. Loeb FBO 
Jean L. Troubh); The Belsky-DoylePolikoff-Troubh Family Trust; Trust 

U/A/D 10/11/63 FBO Benet S. Polikoff; 

Trust U/W Judith L. Chiara FBO Aliana 

R. Beaty (a/k/a Aliana Rae Beaty Trust 

U/W Judith L. Chiara); John Levin, 

Jerome Manning TTEE TR FBO Frances

Perry (FP06) (a/k/a Trust U/A/D 10/16/61 

JLL FBO Frances Beaty Perry); John 

Levin, Jerome Manning TTEE TR FBO 

Daniela Chiara (ZZDC06) (a/k/a Trust 

U/A/D 10/16/61 JLL FBO Daniela 

Chiara); John Levin, Jerome Manning 

TTEE JLL TR (ZZCC06) (a/k/a Trust 

U/A/D 10/16/61 JLL FBO Charles 

Chiara); John L Loeb, Jerome Manning 

TTEE JLL 61 TR FBO NICHOLAS 

(ZZJL06) (a/k/a Trust U/A/D 10/16/61 

JLL FBO Nicholas Loeb); Jerome 

Manning, J Levin TTEE A Lehman TR 

(ZZRB02) (a/k/a Trust U/A/D 9/9/64 

FBO Richard Beaty); Jerome Manning, J 

Levin TTEE A Lehman Tr (ZZRB02) 

(a/k/a Trust U/A/D 9/9/64 FBO Daniela 

Chiara); Jerome Manning, J Levin TTEE 

A Lehman Tr (ZZRB02) (a/k/a Trust 

U/A/D 9/9/64 FBO Anne P. Beaty); 

Jerome Manning, J Levin TTEE A 

Lehman Tr (ZZRB02) (a/k/a Trust U/A/D 

9/9/64 FBO Charles Chiara); Jerome 

Manning, J Levin TTEE A Lehman Tr 

(ZZRB02) (a/k/a Trust U/A/D 9/9/64 

FBO Frances Beaty Perry); Jerome 

Manning, J Levin TTEE A Lehman Tr 

(ZZRB02) (a/k/a Trust U/A/D 9/9/64 

FBO John L. Beaty); Levin Manning 

Beaty TTEE J L Chiara TR (ZZRB05) 

(a/k/a Trust U/W Judith L. Chiara FBO 

Richard Beaty); Levin Manning Beaty 

TTEE J L Chiara TR (ZZRB05) (a/k/a 
Trust U/W Judith L. Chiara FBO John L. 

Beaty); Levin Manning Beaty TTEE J L 

Chiara TR (ZZFP05) (a/k/a Trust U/W 

Judith L. Chiara FBO Frances Beaty 

Perry); Levin Manning Beaty TTEE J L 

Chiara TR (AB05) (a/k/a Trust U/W 

Judith L. Chiara FBO Anne P. Beaty); 

Levin Manning Beaty TTEE J L Chiara 

TR (ZZRB05) (a/k/a Trust U/W Judith L. 

Chiara FBO Charles Chiara); The Jessica 

Levin 2001 Trust; The Jacob Thomas 

Carter Trust (a/k/a The Jacob Thomas 

Carter 2005 Trust); The Emily Renee 

Carter Trust (a/k/a The Emily Renee 

Carter 2005 Trust); The Lisa Louise 

Carter Trust (a/k/a The Lisa Louise Carter 

2005 Trust); The Jennifer Carter 2005 

Family Trust (a/k/a The Jennifer Levin 

Carter 2005 Family Trust); The Talia 

Bela Chorowsky Trust; The Daniel Silver 

Levin Annual Exclusion Trust; The Noa 

Rachel Chorowsky Trust; The Allison 

Levin Carter Trust (a/k/a The Allison 

Levin Carter 2005 Trust); John Levin 

John T Beaty, J Manning TTEE FLL TR 

FBO Charles Chiara (a/k/a Trust U/I/D 

6/1/74 FBO Charles Chiara); John Levin 

John T Beaty J Manning TTEE FLL TR 

FBO John L Beaty (a/k/a Trust U/I/D 

6/1/74 FBO John L. Beaty); John Levin 

John Loeb Jr, Jerome Manning TTEE 

(ZZJL03) (a/k/a Trust U/I/D 6/1/74 FBO 

Nicholas Loeb); John Levin John T 

Beaty, J Manning TTEE 74 TR FBO 

Alexandra (a/k/a Trust U/I/D 6/1/74 FBO 

Alexandra Loeb Driscoll); John Levin 

John T Beaty, J Manning TTEE FLL 

Trust (a/k/a Trust U/I/D 6/1/74 FBO 

Frances Beaty Perry); John Levin, Jerome 

Manning TTEE TR FBO John Beaty 
(ZZJB07) (a/k/a Trust U/A/D 10/16/61 

FLL FBO John L. Beaty); John Levin, 

Jerome Manning TTEE JLL 61 TR FBO 

Alexandra Loeb Driscoll (a/k/a Trust 

U/A/D 10/16/61 FLL FBO Alexandra 

Loeb Driscoll); Jerome A Manning John 

A Levin, Arthur L Loeb TTEE (ZZAL02) 

(a/k/a Trust U/W Frances L. Loeb FBO 

Arthur L. Loeb); Arthur Loeb Foundation 

Inc. C/O Arthur Loeb (a/k/a Arthur Loeb 

Foundation Inc.); Judith L Chiara Char 

Fund # 3 C/O Levin Capital Strategies 

(a/k/a Judith L. Chiara Charitable Fund, 

Inc.); Jerome A Manning TTEE Louis 

D’almeida CRT (a/k/a Louis D’Almeida 

Charitable Remainder Trust); Manning 

Levin Beaty TTEE TR U/W FLL FBO 

Anne P Beaty (a/k/a Trust U/W Frances 

L. Loeb FBO Anne P. Beaty); Manning 

Levin Beaty TTEE TR U/W FLL FBO 

Frances B Perry (a/k/a Trust U/W Frances 

L. Loeb FBO Frances Beaty Perry); John 

Levin J Manning, John Loeb Jr TTEE TR 

U/W FLL FBO Nicholas Loeb (a/k/a 

Trust U/W Frances L. Loeb FBO 

Nicholas Loeb); Manning Levin Loeb 

TTEE TR U/W FLL FBO Alexandra L 

Driscoll (a/k/a Trust U/W Frances L. 

Loeb FBO Alexandra Loeb Driscoll); 

Manning Levin Loeb TTEE TR U/W FLL 

FBO Kristin (a/k/a Trust U/W Frances L. 

Loeb FBO Kristin Beaty Paszkiewicz); 

Manning Levin Beaty TTEE TR U/W 

FLL FBO Chrisoph Beaty (a/k/a Trust 

U/W Frances L. Loeb FBO Christopher 

Beaty); Manning Levin Beaty TTEE TR 

U/W FLL FBO Ryan Beaty (a/k/a Trust 

U/W Frances L. Loeb FBO Ryan Beaty); 

Manning Levin Beaty TTEE TR U/W 

FLL FBO John L Beaty (a/k/a Trust U/W 
Frances L. Loeb FBO John L. Beaty); 

Manning Levin Beaty TTEE TR U/W 

FLL FBO Charles Chiara (a/k/a Trust 

U/W Frances L. Loeb FBO Charles 

Chiara); John Levin, Jerome Manning 

TTEE Trust FBO Sophie V. Chiara U/W 

5/17/96 (a/k/a Trust U/W Frances L. Loeb 

FBO Sophie Valentine Chiara); John 

Levin John T Beaty, J Manning TTEE J L 

Chiara TR FBO Daniela Chiara (a/k/a 

Trust U/W Judith L. Chiara FBO Daniela 

Chiara); John Levin John Loeb Jr, Jerome 

Manning TTE (ZZAL03) (a/k/a Trust 

U/I/D 6/1/74 FBO Arthur L. Loeb); John 

Levin John T. Beaty, J Manning TTEE 

(ZZRB04) (a/k/a Trust U/I/D 6/1/74 FBO 

Richard Beaty); John Levin John T Beaty, 

J Manning TTEE FLL Trust ZZAB04 

(a/k/a Trust U/I/D 6/1/74 FBO Anne P. 

Beaty); Levin Beaty Manning Daniela 

Chiara TTEE ZZDC04 (a/k/a Trust U/I/D 

6/1/74 FBO Daniela Chiara); Richard N 

Beaty Jr (LCS) (a/k/a Richard N. Beaty, 

Jr.); Daniela Chiara; Jerome Manning, J 

Loeb Jr TTEE Trust FBO Arthur Loeb 

(ZZAL05) (a/k/a Trust U/I/D 12/31/40 

FBO Arthur L. Loeb); John Loeb Jr, 

Jerome Manning TTE Trust FBO Arthur 

Loeb (a/k/a Trust U/A/D 9/9/64 FBO 

Arthur L. Loeb); John Loeb Jr, J Manning 

TTEE Trust FBO John Loeb Jr (a/ka/ 

Trust U/A/D 9/9/64 FBO John Loeb Jr); 

Mr. Arthur L Loeb (a/k/a Arthur L. 

Loeb); John A. Levin, John Loeb Jr TTEE 

U/W CML Tr FBO Arthur Loeb ZZAL06 

(a/k/a Trust U/W Carl M. Loeb FBO 

Arthur L. Loeb); John Levin, Jerome 

Manning TTEE Tr FBO Richard Beaty Jr 

(RB06) (a/k/a Trust U/A/D 10/16/61 JLL 

FBO Richard N. Beaty); John Levin, 
Jerome Manning TTEE Tr JLL 61 FBO 

John L Beaty (ZZJB06) (a/k/a Trust 

U/A/D 10/16/61 JLL FBO John L. 

Beaty); John Levin, Jerome Manning 

TTEE Tr JLL 61 FBO Ann P Beaty 

(ZZAB06) (a/k/a Trust U/A/D 10/16/61 

JLL FBO Anne P. Beaty); The Lisa 

Louise Carter Trust; Ann L. Bronfman 

Fam Char Trust (a/k/a Ann L. Bronfman 

Family Charitable Trust); Matthew 

Bronfman; Stacy Bronfman (a/k/a Stacey 

Bronfman); Tr U/W Henry A. Loeb FBO 

Betty Pearson Clause 6 (a/k/a Trust U/W 

Henry A. Loeb FBO Betty Pearson); Tr 

U/W Judith L. Chiara FBO Stroock & 

Stroock & Lavan (a/k/a Trust U/W Judith 

L. Chiara FBO Rosa Anna Iaia); Tr U/W 

Judith L. Chiara FBO Stroock & Stroock 

& Lavan (a/k/a Trust U/W Judith L. 

Chiara FBO Lawrence Birns); TR UWO 

Carl M. Loeb FBO E L Levin (a/k/a Trust 

U/W Carl M. Loeb FBO Elisabeth L. 

Levin); Jessica Levin 2002 Trust (a/k/a 

The Jessica Levin 2002 Trust); Henry L. 

Levin; The Jacob Thomas Carter Trust; 

The Henry Levin 2001 Trust (a/k/a The 

Henry L. Levin 2001 Trust); The Elise E 

Lieberman Trust (a/k/a The Elise Evelyn 

Lieberman Trust); The Jennifer Levin 

Carter 2001 Family Trust (a/k/a The 

Jennifer Levin Carter 2001 Trust); The 

Treetops Foundation; The Allison Levin 

Carter Trust; HJJD Associates, a 

partnership c/o Henry Levin (a/k/a HJJD 

Associates, L.P.); Trust 12/4/92 FBO 

Henry L. Levin (a/k/a Trust U/A/D 

12/4/92 FBO Henry L. Levin); The 

Elisabeth & John Levin Trust (a/k/a Trust 

U/A/D 12/4/92 FBO Jessica E. Levin); 

Elisabeth Levin (a/k/a Elisabeth L. 
Levin); The Emily Renee Carter Trust; 

Gabriela Talia Bronfman Legacy Trust 

UW Ann L. Bronfman (a/k/a Gabriela 

Talia Bronfman Legacy Trust U/W Ann 

L. Bronfman); Gabriela T Bronfman 

appointed Tr UW Ann L. Bronfman (a/k/a 

Gabriela Talia Bronfman Appointed Trust 

U/W Ann L. Bronfman); Jeremy Samuel 

Bronfman Legacy Tr UW Ann L. 

Bronfman (a/k/a Jeremy Samuel 

Bronfman Legacy Trust U/W Ann L. 

Bronfman); Christine Davies Special 

Account – SD (a/k/a Christine Davies 

I/T/F Steffan Davies); Coby B. Bronfman 

Appointed Tr UWO Ann L. Bronfman 

(a/k/a Coby Benjamin Bronfman 

Appointed Trust U/W Ann L. Bronfman); 

Fiona M. Woods; Trust 12/4/92 FBO 

Jennifer Levin Carter (a/k/a Trust U/A/D 

12/4/92 FBO Jennifer Levin Carter); 

Adam R. Bronfman Fam Foundation Inc. 

(a/k/a Adam R. Bronfman Family 

Foundation Inc.); and Coby Benjamin 

Bronfman Legacy Tr UW Ann L. 

Bronfman (a/k/a Coby Benjamin 

Bronfman Trust U/W Ann L. Bronfman),

Petitioners,

v.

Rouse Properties, Inc.,

Respondent.
Brookdale International Partners, L.P. 

And Brookdale Global Opportunity Fund, 

Petitioners,

V.

Rouse Properties, Inc.,

Respondent.

C.A. No. 12549-VCS

MEMORANDUM OPINION

Date Submitted: November 4, 2016

Date Decided: December 8, 2016

Stuart M. Grant, Esquire, Cynthia A. Calder, Esquire, and Kimberly A. Evans, 

Esquire of Grant & Eisenhofer P.A., Wilmington, Delaware, Attorneys for 

Petitioners Sunrise Partners Limited Partnership, Hudson Bay Master Fund Ltd., 

DBW Lycurgus LLC, Levcap Alternative Fund LP, et al. 

Stephen E. Jenkins, Esquire, Andrew D. Cordo, Esquire, and Marie M. Degnan, 

Esquire of Ashby & Geddes, PA, Wilmington, Delaware, Attorneys for Petitioners 

Brookdale International Partners, L.P. and Brookdale Global Opportunity Fund.

Kevin G. Abrams, Esquire and Daniel R. Ciarrocki, Esquire of Abrams & Bayliss 

LLP, Wilmington, Delaware, and John A. Neuwirth, Esquire and Evert J. 

Christensen, Jr., Esquire of Weil, Gotshal & Manages LLP, New York, New York, 

Attorneys for Respondent Rouse Properties, Inc.

SLIGHTS, Vice Chancellor
1

After a merger closes, it is not uncommon for several dissenting 

stockholders to file separate petitions with this Court seeking statutory appraisal of 

the fair value of their shares. It is, however, uncommon for those stockholders not 

to agree on the manner in which the multiple petitions should be consolidated and 

then prosecuted. Unfortunately, this is that uncommon case. Two camps of 

appraisal petitioners, representing five separate petitioners, have been unable to 

agree on a unified leadership structure or a unified approach to prosecuting the 

appraisal petitions. When negotiations among the camps reached an impasse, one 

camp filed a motion with the Court to appoint lead counsel. The other camp 

opposes the motion. 

For the reasons that follow, the motion is granted. I am satisfied that 

Delaware’s appraisal statute does not prohibit the Court from appointing lead 

counsel in an appraisal proceeding even when some petitioners object. This 

authority is an extension of the Court’s inherent power to manage its cases in a 

manner that attempts to ensure efficient, consistent and fair outcomes for all 

concerned. Since appraisal proceedings are in the nature of class actions, I have 

drawn heavily from this Court’s jurisprudence regarding the efficient management 

of class actions in reaching my decision here, including the guidelines this Court 

has established to assist in the selection of an appropriate class leadership structure. 
2

While I have determined that it is best to appoint lead counsel in this 

instance, I emphasize that this is a case-specific determination that reflects my 

exercise of discretion in a particular case. As noted, in most instances, appraisal 

petitioners will agree on the appropriate means to prosecute their respective 

petitions. That is to be encouraged. When the various petitioners do not agree, 

there may well be cases where the Court determines it is best to allow each 

petitioner to chart its own course without consolidation or coordination. This is 

not such a case.

I. BACKGROUND

On July 6, 2016, Rouse Properties, Inc. (“Rouse”) and BSREP II Retail 

Holdings Corp., an affiliate of Brookfield Asset Management, Inc. (collectively, 

“Brookfield”), closed a merger by which Brookfield acquired Rouse in an all-cash 

transaction for $18.25 per share (the “Merger”). Following the Merger, on July 11, 

2016, Petitioners, Brookdale International Partners, L.P. and Brookdale Global 

Opportunity Fund (collectively, “Brookdale”), the beneficial owners of 

approximately 21% of the shares that demanded appraisal, filed their Verified 

Petition for Appraisal of Stock. On August 1 and August 18, 2016, Sunrise 

Partners Limited Partnership, entities and individuals affiliated with Levin Capital 

Strategies, LP, Hudson Bay Master Fund Ltd. and DBW Lycurgus LLC 

(collectively the “Majority Petitioners”) each filed separate petitions for appraisal. 
3

The Majority Petitioners represent the beneficial owners of approximately 75% of 

the shares entitled to appraisal. In all, the five separate actions represent 6,721,182 

shares of Rouse stock. All petitions seek a determination of the fair value of Rouse 

as a going concern as of July 6, 2016.

Brookdale is represented by Ashby & Geddes, PA (“A&G”). The Majority 

Petitioners are represented by Grant & Eisenhofer P.A. (“G&E”).1 On August 25, 

2016, A&G contacted G&E to discuss logistics for moving the five separate 

actions forward by consolidating the actions and establishing a leadership 

structure. During these discussions, A&G made it clear that, notwithstanding 

consolidation, Brookdale would insist that it be permitted to engage and call its 

own valuation witness at trial and that it otherwise be permitted to separate from 

the litigation path chosen by the Majority Petitioners should it choose to do so. 

Brookdale also made it clear that it would agree to compensate only its own chosen 

counsel, A&G, even if G&E was to take on the role of lead counsel. G&E 

objected to Brookdale’s conditions and, despite further efforts to work out 

alternative arrangements, the parties could not reach agreement on a leadership 

structure. 

 

1 Brookdale consulted with G&E about representation but ultimately elected to engage 

A&G. It appears that the fee structure proposed by G&E was contingent upon the 

outcome of the proceedings while A&G agreed to bill on a non-contingent basis. 
4

On September 26, 2016, the Majority Petitioners filed a Motion to 

Consolidate and for Appointment of Lead Counsel (the “Motion”). In the Motion, 

the Majority Petitioners and G&E contend that all petitioners will benefit from a 

coordinated and unified approach to the litigation. While it is willing to listen to 

A&G and Brookdale, and to take their views into account when formulating 

litigation strategy, G&E maintains that it should not be placed in a leadership 

structure where Brookdale can call its own shots if and when it chooses. Nor 

should the Court sanction a leadership structure where Brookdale may choose not 

to pay G&E for its work on behalf of all stockholders entitled to appraisal. 

According to the Majority Petitioners and G&E, the various strands of autonomy

Brookdale seeks to impose on the leadership structure would encourage “free 

riding” and create other negative incentives for Brookdale and for future appraisal 

petitioners. 

Brookdale and A&G oppose the Motion. They argue that the Court cannot 

force them to accept G&E as lead counsel because such a court-ordered leadership 

structure would deny Brookdale its statutory right to “participate fully” in this

appraisal proceeding.2 They also contend that an order appointing G&E as lead 

counsel would deny Brookdale its right to be represented by its counsel of choice. 

Finally, as for the argument that denying the Motion might create negative 

 

2

8 Del. C. § 262(h).
5

incentives, Brookdale and A&G maintain that they have no intention of “free 

riding” here and they assure the Court that they will carry their fair share of the 

litigation load.

II. ANALYSIS

I address the Motion in four parts. First, I address the uncontested motion to 

consolidate the various appraisal actions relating to Rouse. Second, I consider 

whether Brookdale is correct that Delaware’s appraisal statute does not allow the 

Court to appoint a leadership structure over the objection of a stockholder who 

appears to have properly perfected a claim for appraisal. Third, I consider whether 

the Court has the inherent power to appoint a leadership structure that it believes 

will further the efficient, consistent and fair litigation of all pending petitions for 

appraisal. In this regard, I consider whether there is anything unique about 

appraisal actions that would justify managing these actions differently than the 

manner in which this Court manages class actions. Finally, I draw on this Court’s

jurisprudence in the class action context to determine the appropriate leadership 

structure in this case.

A. The Separate Petitions Will Be Consolidated

None of the parties dispute that the five separate appraisal petitions should

be consolidated pursuant to Court of Chancery Rule 42(a), and for good reason. 

The actions share common questions of law and fact and in each the petitioner 
6

seeks the identical relief – a declaration of the fair value of Rouse as a going 

concern at the time of the merger. For these reasons, separate appraisal actions 

relating to the same entity are typically prime candidates for consolidation. This 

case is no exception. The motion to consolidate will be granted. 

B. The Appraisal Statute Does Not Prohibit the Appointment of 

Leadership Over the Objection of a Petitioner Who Otherwise 

Has Standing to Pursue Appraisal of its Shares

Brookdale argues that the Court lacks authority to “override an active 

appraisal petitioner’s choice of counsel by appointing sole lead counsel over the 

petitioner’s objection and thereby deprive the petitioner of its statutory right to 

participate in the litigation.”3 In support of this argument, Brookdale points to a 

provision in 8 Del. C. § 262(h) which provides that a stockholder whose name 

appears on the surviving corporation’s verified list of all stockholders who have 

demanded payment for their shares “may participate fully in all proceedings until it 

is finally determined that such stockholder is not entitled to appraisal rights under 

this section.” After carefully reviewing this provision and other relevant portions 

of Delaware’s appraisal statute, I am satisfied that the statutory language 

highlighted by Brookdale does not support its contention that the appointment of 

 

3 Opp’n of Pet’rs Brookdale International Partners, L.P. and Brookdale Global 

Opportuiny Fund to Mot. for Consolidation and Appointment of Lead Counsel at 9. 
7

lead counsel would somehow deprive it of its statutory right to participate fully in 

this appraisal action as contemplated by the statute.

“Words and phrases [in Delaware statutes] shall be read with their context 

and shall be construed according to the common and approved usage of the English 

language.”4 When words within a statute are undefined, Delaware courts 

frequently look to standard dictionary definitions for guidance.5 MerriamWebster’s Dictionary defines the verb “participate” as follows: “to take part; to 

have a part or share in something.”6 

Nothing in the Court’s order appointing a leadership structure will deny 

Brookdale of its right to “take part” fully in this appraisal litigation along with all 

of the other petitioners. Regardless of which law firm is on point to prosecute the 

petitions for appraisal, Brookdale will remain an active petitioner and its claim for 

appraisal will be protected. The issue in appraisal is fair value; nothing more and 

nothing less.7 In this regard, Brookdale’s interests are perfectly aligned with all 

 

4

1 Del. C. § 303.

5

Ingram v. Thorpe, 747 A.2d 545, 548 (Del. 2000).

6

Participate, Merriam-Webster’s Collegiate Dictionary (10th ed. 1996). To “direct,” on 

the other hand, means “to point out, prescribe or determine a course or procedure.”

Direct, Merriam-Webster’s Collegiate Dictionary (10th ed. 1996). 

7 Cede & Co. v. Technicolor, Inc., 542 A.2d 1182, 1187 (Del. 1988) (“[I]n a section 262 

appraisal action the only litigable issue is the determination of the value of the appraisal 

petitioners’ shares on the date of the merger. . .”). 
8

other petitioners seeking appraisal; they all share an absolute incentive to obtain 

the highest possible value for their Rouse shares. It appears that Brookdale has 

perfected its rights to appraisal and that it will hereafter “participate” fully in this 

appraisal action. It will not, however, “direct” the course of this consolidated 

litigation on behalf of the petitioners and the statute does not guarantee it a right to 

do so.

In addition to considering the “common and approved” usage of words 

within a statute, Delaware courts are directed to consider “context” when 

construing the statute’s meaning.8 Several provisions within Delaware’s appraisal 

statute support the conclusion that the statute’s use of the phrase “participate fully” 

is not intended to confer a right upon all individual appraisal petitioners to litigate 

their claims separately or to direct the course of the litigation should the Court 

determine to consolidate separately filed petitions. Section 262(h), for example, 

provides that “[a]fter the Court determines the stockholders entitled to an appraisal, 

the appraisal proceeding shall be conducted in accordance with the rules of the 

Court of Chancery. . . .”

9

 Court of Chancery Rule 42(a), in turn, which governs 

consolidation, provides that “[the Court] may make such orders concerning 

 

8

See 1 Del. C. § 303 (“Words and phrases [in Delaware statutes] shall be read with their 

context. . . .”). 

9

8 Del. C. § 262(h).
9

[consolidated] proceedings ... as may tend to avoid unnecessary costs or delay.”10 

An order consolidating multiple appraisal actions and appointing lead counsel to 

prosecute the action serves the function of “avoid[ing] unnecessary costs and 

delay.” 

After incorporating the Court of Chancery Rules, Section 262(h) goes on to 

state that “[a]ny stockholder whose name appears on the list filed by the surviving 

or resulting corporation pursuant to subsection (f) of this section and who has 

submitted such stockholder’s certificates of stock to the Register in Chancery, if 

such is required, may participate fully in all proceedings until it is finally 

determined that such stockholder is not entitled to appraisal rights under this 

section.”11 Section 262(f), in turn, provides that “[u]pon the filing of [an appraisal] 

petition by a stockholder, service of a copy thereof shall be made upon the 

surviving or resulting corporation, which shall within 20 days after such service 

file in the office of the Register in Chancery in which the petition was filed a duly 

verified list containing the names and addresses of all stockholders who have 

demanded payment for their shares . . .”12 Thus, the 

“participate fully” language in Section 262(h) refers to “any stockholder whose 

 

10 Ct. Ch. R. 42(a). 

11 8 Del. C. § 262(h).

12 8 Del. C. § 262(f).
10

name appears on the list filed pursuant to subsection (f),” regardless of whether vel

non the stockholder actually filed a petition for appraisal in this Court. 

When read together, and in context, Sections 262(f) and (h) do not support 

Brookdale’s position that Section 262(h) is intended to provide an appraisal 

petitioner with the right to exercise complete autonomy in the prosecution of its 

petition or to prevent the appointment of lead counsel in consolidated appraisal 

litigation. Since the statute recognizes that a dissenting stockholder who has

chosen not to file a petition can “participate fully” in the proceedings, as that 

phrase appears in the statute, it is not reasonable to interpret the phrase as 

guaranteeing a dissenting stockholder who has filed a petition the right to

separately prosecute the petition in consolidated appraisal litigation with the 

counsel of its choosing. 

Finally, I note that Section 262(j) expressly contemplates that appraisal 

petitioners may be held accountable for attorney’s fees beyond those charged by 

their individual counsel.

13

 Specifically, the statute acknowledges that counsel who 

leads the effort on behalf of the “appraisal class” should be compensated by the 

“entire appraisal class.”14 That is all G&E is seeking here.

 

13 8 Del. C. § 262(j).

14 In re Appraisal of Dell, Inc., 2016 WL 6069017, at*3 (Del. Ch. Oct. 17, 2016) 

([Section 262(j)] says that you can tax and allocate costs and expenses pro rata across the 

entire appraisal class. That’s in the statute.”); Id. (“The fees and expenses at the end 
11

Brookdale’s argument that it will be denied its statutory right to “participate 

fully” in these proceedings if the Court appoints G&E as lead counsel is not 

supported by a reasonable interpretation of the appraisal statute. Nothing in the 

statute stands as an impediment to the Court’s exercise of either its authority under 

Court of Chancery Rule 42 to enter orders that will “tend to avoid unnecessary 

costs or delay” or its inherent power to manage its docket.15

C. Appraisal Actions Are in the Nature of a Class Action

Brookdale emphasizes that appraisal actions are not, in fact, susceptible to 

certification as class actions and, therefore, the Court should not look to its 

practices in managing class actions when deciding whether to appoint lead counsel 

here. Brookdale is correct as a matter of substantive law that this Court will not 

certify a class of dissenting stockholders who seek statutory appraisal. Even so, 

our courts have long-recognized that, procedurally, “an appraisal action is a 

proceeding in the nature of a class suit.”16 Three examples illustrate the point.

 

under 262(j) can be taxed against the entire appraisal class pro rata because that’s what’s 

fair. It’s a classic application of common-fund principles. . . . ”); Matter of Appraisal of 

Shell Oil Co., 1992 WL 321250, at *2 (Del. Ch. Oct. 30, 1992) (“Pursuant to 8 Del. C.

§ 262(j), the attorney fees will be assessed pro rata from all the shares entitled to share in 

the appraisal award.”). 

15 See Pfizer, Inc. v. Warner-Lambert Co., 1999 WL 33318818, at *1 (Del. Ch. Dec. 22, 

1999) (“This Court has the inherent authority to control its own docket, and to manage 

the scheduling of multiple lawsuits arising from the same set of operative facts.”). 

16 Ala. By-Prods. Corp. v. Cede & Co., 657 A.2d 254, 260 (Del. 1995) (citing Southern 

Production Co., Inc. v. Sabath, 32 Del. Ch. 497, 508 (Del. 1952)). 
12

First, Section 262(k) requires approval of the Court before an appraisal 

proceeding can be dismissed as to any stockholder.17 The purpose of this 

requirement is to avoid the harm that might be caused to other dissenting 

stockholders if one petitioner settles at a premium while leaving others to fend for 

themselves and possibly receive less value for their shares.

18

 This same concern 

that defendants might attempt to “pick-off” the class representative with a premium 

settlement at the expense of other class members is one of the primary reasons this 

Court also requires that all class action settlements be approved by the Court.19 

 

17 8 Del. C. § 262(k).

18 Ala. By-Prods. Corp., 657 A.2d at 261 (discussing the “policy behind the 

Section 262(k) court approval requirement” is to avoid the “vice of selling out the 

class.”). See also In re Appraisal of Dell Inc, Consol. C.A. No. 9322 (June 27, 2015)

(TRANSCRIPT) at 7 (“But what I need you to do, because this is ‘in the nature of’ a 

class action, is to at least reach out to the Magnetar folks and the other folks on the 

verified list and let them know that this offer has been made.”). 

19 Ala. By-Prods. Corp., 657 A.2d at 260 (stating “[t]he court approval requirement 

ensures that a shareholder does not settle out of the class suit at a premium, thereby 

abandoning the prosecution of the action to the detriment of other class members.”). The 

fact that appraisal petitioners have no right to “opt out” of the resolution of a consolidated 

appraisal action does not render the procedural guidance to be drawn from this Court’s 

management of class action litigation any less apt. Indeed, our courts will certify a class 

as a non-opt-out class under Court of Chancery Rule 23(b)(1) even where the class is 

entitled to only monetary relief in cases where all members of the class are similarly 

situated with respect to issues of liability and damages and share identical incentives. See 

Turner v. Bernstein, 768 A.2d 24, 30–31 (Del. Ch. 2000) (citing In re Mobile Commc’ns 

Corp. of Am., Inc. Consol. Litig., 1991 WL 1392, at *15 (Del. Ch. Jan. 7, 1991)). 

Therefore, there is nothing unusual or unjust about requiring Brookdale to accept the 

appraisal value determined in an appraisal proceeding prosecuted by Court-appointed 

lead counsel, who have the same incentive as Brookdale’s preferred counsel to maximize 

the recovery for all petitioners.
13

The similarity of the procedural form and the representative character of class 

actions and appraisal litigation is a reflection that the named plaintiff/petitioner is

standing in the shoes of others who have similarly vested, if not identical, interests. 

Second, as noted, Section 262(j) incorporates basic common-fund principles 

with respect to the allocation of counsel fees among the appraisal class at the 

conclusion of the litigation.20 In this regard, the appraisal statute itself implicitly 

acknowledges that appraisal litigation is in the nature of a class action.21

Third and finally, I note that the fiduciary relationship that exists between 

court-appointed lead counsel in a class action and all members of the class also 

exists between court-appointed lead counsel in an appraisal action and all other 

stockholders entitled to appraisal.

22

 After the Court enters the order consolidating 

the actions and appointing G&E as lead counsel, G&E will owe duties of care and

loyalty to Brookdale.

23

 Brookdale’s interests will be protected by G&E along with 

the interests of all stockholders entitled to appraisal. 

 

20 Dell, 2016 WL 6069017, at *3.

21 Ala. By-Prods. Corp., 657 A.2d at 260.

22 Id; Dell, 2016 WL 6069017, at *3 (“[R]emember, part of what you do when you are 

an appraisal claimant is you take on a fiduciary role . . . to the people who didn’t file 

because there are members of the appraisal class who haven’t filed petitions, and they're 

entitled to rely on the actions of those who did file.”). 

23 In re M & F Worldwide Corp. S’holders Litig., 799 A.2d 1164, 1175 (Del. Ch. 2002)

(stating that in the context of representative litigation “counsel owed a duty to act in good 

faith on behalf of all intended beneficiaries of the representative action, and not simply at 
14

D. The Hirt Factors Support the Appointment of G&E as Lead 

Counsel

Having determined that this consolidated appraisal action is in the nature of 

a class action, it is appropriate to look for guidance to this Court’s practices 

regarding the management of class action litigation. As an initial matter, the Court 

will exercise its discretion to appoint lead counsel in a class action when multiple 

complaints have been filed and the Court determines that it will be more effective 

for the class and more efficient for the management of the litigation to create a 

structure where the class speaks with the clear voice of unified advocates rather 

than the cluttered and potentially disingenuous voices of several competing 

advocates.24

Here, it is evident that Brookdale and the Majority Petitioners, and A&G and 

G&E, notwithstanding their efforts to coordinate, will struggle to speak with a 

 

the direction of the named plaintiffs.”); Id. at n. 34 (“By now it is well established that by 

asserting a representative role on behalf of a proposed class, representative plaintiffs and 

their counsel voluntarily accept a fiduciary obligation towards members of the putative 

class.”); In re Agent Orange Prod. Liability Litig., 800 F.2d 14, 18 (2d Cir. 1986) (“the 

class attorney’s duty does not run just to the plaintiffs named in the caption of the case; it 

runs to all of the members of the class.”); Parker v. Anderson, 667 F.2d 1204, 1211 (5th

Cir. 1982) (“The duty owed by class counsel is to the entire class and is not dependent on 

the special desires of the named plaintiffs.”). 

24 In re Del Monte Foods Co. S’holders Litig., 2010 WL 5550677, at *6 (Del. Ch. Dec. 

31, 2010) (stating the when appointing lead counsel “[t]he Court’s overriding goal is 

establish a leadership structure that will provide effective representation.”). 
15

unified voice during this litigation.25 Indeed, I detect a significant risk that the two 

camps may present conflicting positions that could undermine the credibility of the 

petitioners’ overall presentation. I am also troubled by Brookdale’s absolute 

refusal to consider an arrangement where it will contribute to the compensation of 

G&E at the end of the litigation for its share of any common benefit that G&E 

might bring to all stockholders seeking appraisal. While I have no doubt that A&G 

would make meaningful contributions to the litigation effort, even the structure 

that Brookdale proposes would have G&E tackling the lion’s share of the work. 

Brookdale’s blanket refusal to agree to compensate G&E for even a portion of this 

work smacks of free riding. Under these circumstances, I am satisfied that the 

appointment of lead counsel is appropriate.

When appointing lead counsel in the class action context, this Court looks to 

the factors set forth in Hirt v. U.S. Timberlands Service Co.26 They are:

 The quality of the pleading that appears best able to represent 

the interests of the shareholder class and derivative plaintiffs;

 [T]he relative economic stakes of the competing litigants in the 

outcome of the lawsuit (to be accorded “great weight”); 

 

25 I note that A&G and G&E have worked well together in the past in appraisal litigation. 

I suspect, in this case, that the disagreements are more client-driven than counsel-driven.

26 2002 WL 1558342, at *2 (Del. Ch. July 3, 2002) (drawing heavily from Chancellor 

Chandler’s decision in TWC Tech. Ltd. P’ship v. Intermedia Commc’ns, Inc., 2000 WL 

1654504, at *4 (Del. Ch. Oct. 17, 2000)). 
16

 [T]he willingness and ability of all the contestants to litigate 

vigorously on behalf of an entire class of shareholders;

 [T]he absence of any conflict between larger, often institutional, 

stockholders and smaller stockholders;

 [T]he enthusiasm or vigor with which the various contestants 

have prosecuted the lawsuit; [and]

 [T]he competence of counsel and their access to the resources 

necessary to prosecute the claims at issue.27

The unique facts of each controversy over the appointment of lead counsel 

will often cause the Court to dwell on certain Hirt factors while glossing over 

others. This “nuanced and case-specific” approach helps to ensure that the Court 

establishes “a leadership structure that will provide effective representation” and 

best serve the interests of the petitioners.28 

While A&G has not moved to be appointed lead counsel, and so this is not a 

traditional scenario where the Court is selecting lead counsel among several firms 

vying for lead counsel status, application of the Hirt factors strengthens the 

conclusion that appointing G&E as lead counsel is appropriate in this case. I will 

address the Hirt factors that have informed my decision in ascending order of 

relevance. 

 

27 Id. (footnotes and internal quotation marks omitted). 

28 In re Delphi Fin. Gp. S’holder Litig., 2012 WL 424886, at *1 (Del. Ch. Feb. 7, 2002) 

(“[E]ach factor is given weight only to the extent that it bears on the ultimate question of 

what is in the best interests of the plaintiff class.”). 
17

First, the quality of the pleadings is not a factor that weighs in favor of 

either counsel. Given that this is an appraisal action, the pleadings are relatively 

simple and fairly standardized. Second, the enthusiasm and vigor in the 

prosecution of the action thus far does not favor or disfavor G&E. All counsel 

have demonstrated enthusiasm and vigor in the prosecution of their respective 

petitions for appraisal and I am certain that both G&E and A&G would continue to 

represent their clients with skill and appropriate energy. Third, I detect no conflict 

in the incentives that both Brookdale and Majority Petitioners have to seek the 

highest value they can achieve for their Rouse shares. Fourth, the competence of 

counsel weighs in favor of G&E. There is no doubt that all counsel involved in 

this dispute are highly competent and among the best of the lawyers who regularly 

prosecute appraisal actions in this Court. Nevertheless, G&E’s track record in 

appraisal litigation is exceptional. Fifth, the relative competing economic stakes of

the litigants is a factor that heavily favors G&E. The Majority Petitioners are the 

beneficial owners of over 75% of the shares entitled to appraisal. While both 

camps of petitioners have large economic stakes that would incentivize them to 

participate actively in the litigation, the difference between the economic stakes of 

the two camps is large enough to “demonstrate a substantial relative difference” 

under Hirt.

29

 The Court must give this factor “great weight.”30 

 

29 Wiehl v. Eon Labs, 2005 WL 696764, at *3 (Del. Ch. Mar. 22, 2005).
18

III. CONCLUSION

Because I have concluded that the appointment of lead counsel in this action 

would not deprive Brookdale of its statutory right to participate fully in the 

proceedings, that the appointment of lead counsel is appropriate because appraisal 

proceedings are in the nature of class actions, that Brookdale’s concerns are 

mitigated by the fiduciary and ethical duties to which it will be owed by lead 

counsel and that the Hirt factors favor the appointment of G&E, the Motion is

GRANTED. An implementing order will be entered shortly.

 

30 Hirt, 2002 WL 1558342, at *2.