Opinion ID: 2189591
Heading Depth: 1
Heading Rank: 7

Heading: Amended Complaint Dismissed

Text: After the amended complaint was filed, all of the defendants again filed motions to dismiss. The Court of Chancery framed the question before it as whether the plaintiff has pled facts invoking the fraud exception to the [ Lewis v. Anderson ] general rule that the loss of stockholder status in a merger divests a derivative plaintiff of standing? After reviewing the allegations in the amended complaint regarding the Kinross Merger, the Court of Chancery concluded that, to survive a motion to dismiss, the plaintiff was required to plead particularized facts invoking the fraud exception to Lewis v. Anderson in order to avoid dismissal, and that plaintiff failed to meet that burden. Alternatively, the Court of Chancery concluded that, even if the less stringent pleading standard in Court of Chancery Rule 12 was applicable to the plaintiff's claim of fraud, the plaintiff's amended complaint still failed to meet that standard because [n]othing in the plaintiff's complaint reasonably supports the inference that Amax Gold structured the merger with Kinross the way it did solely to deprive the plaintiff of standing or that it was Amax Gold that sought this structure.