Wolf Popper LLP Files Amended Complaint in GGP Consolidated Class Action
On May 4, 2020, Wolf Popper LLP filed a 162-page amended class action complaint, alleging breaches of fiduciary duty arising from the 2018 buyout of the publicly held shares of GGP, Inc. by GGP’s controlling stockholder, Brookfield Property Partners L.P. The complaint alleges, among other things, that the buyout, the largest real estate public-company merger in history, was negotiated by a committee of GGP’s board that was neither disinterested nor independent from Brookfield, that the stockholder vote on the transaction was not fully informed, and that as a result of this flawed and unfair process, public stockholders received significantly less than the fair value of their GGP shares.
The complaint is based, in part, on evidence obtained in an action Wolf Popper prosecuted under 8 Del. C. § 220, a statute allowing stockholders to investigate corporate wrongdoing. In a post-trial decision dated August 28, 2019, the Delaware Court of Chancery found that the plaintiff-stockholder represented by Wolf Popper “did his homework on GGP” and had established a credible basis to infer possible misconduct in connection with the merger, and accordingly, ordered GGP to allow him to inspect its internal books and records.
The case is In re GGP Stockholder Litigation, Consolidated C.A. No. 2018-0267-JRS, in the Delaware Court of Chancery. Wolf Popper is co-lead counsel for the putative class.
Wolf Popper LLP Prevails in GGP Books and Records Trial
On August 28, 2019, Vice Chancellor Kathaleen S. McCormick of the Delaware Court of Chancery issued a post-trial decision ruling in favor of a former stockholder of the retail real estate company GGP Inc. In this action, the plaintiff-stockholder, represented by Wolf Popper LLP, seeks to investigate GGP’s 2018 merger with Brookfield Property Partners L.P. In the decision, the Court concluded that the plaintiff had established at trial a credible basis to infer possible wrongdoing in connection with the merger, and accordingly, he was entitled to inspect GGP’s books and records. Among other things, the plaintiff demonstrated a credible basis to believe that Brookfield—which had owned approximately a third of all outstanding GGP stock—constituted GGP’s controlling stockholder and thus owed fiduciary duties to GGP’s unaffiliated stockholders, and that the special committee formed by GGP to negotiate the merger lacked independence and failed to secure fair consideration from Brookfield.
The Court also praised the plaintiff as a “quintessential main street investor” who “did his homework on GGP” and whose testimony was “chalk-full of common sense,” characterizing GGP’s contrary arguments as “deeply misguided.”