société en commandite

Lyondell Chemical Company was the third largest independent, publicly traded chemical company in North America prior to the merger at issue. Dan Smith served as its Chairman and CEO while its remaining ten directors were independent and many had experience as CEOs of other large publicly traded companies. Basell AF, a privately held Luxembourg company owned by Leonard Blavatnik through Access Industries, operated in the polyolefin technology, production, and marketing business. In April 2006 Blavatnik informed Smith of Basell's interest in acquiring Lyondell. Several months later Basell offered between $26.50 and $28.50 per share, an offer Lyondell rejected as inadequate. During the following year Lyondell prospered without any other potential acquirors expressing interest. In May 2007 an Access affiliate filed a Schedule 13D disclosing its right to acquire an 8.3 percent block of Lyondell stock owned by Occidental Petroleum Corporation along with Blavatnik's interest in possible transactions with Lyondell. The Lyondell board immediately convened a special meeting in response to the Schedule 13D filing. The directors recognized that the filing signaled the company was in play but decided to take a wait and see approach. A few days later Apollo Management contacted Smith regarding a management-led LBO which Smith rejected. In late June 2007 Basell announced a merger agreement with Huntsman Corporation but later faced competition from Hexion Specialty Chemicals. On July 9, 2007 Blavatnik met with Smith to discuss an all-cash deal at $40 per share. Smith indicated the price was too low and Blavatnik raised the offer to $44 to $45 per share before ultimately proposing $48 per share. The proposal required no financing contingency but included a $400 million break-up fee and a requirement that the merger agreement be signed by July 16, 2007. Smith called a special board meeting on July 10 to review the offer. The board met for less than one hour on July 10 and again on July 11. It authorized retention of Deutsche Bank Securities as financial advisor and instructed Smith to negotiate with Blavatnik. Between July 12 and July 15 the parties negotiated terms while Basell conducted due diligence and Deutsche Bank prepared a fairness opinion. On July 16 the board met to consider the merger agreement and after presentations from management and advisors voted to approve it. Stockholders approved the merger on November 20, 2007 by more than 99 percent of the voted shares. Stockholders first filed suit in Texas on July 23, 2007. Walter E. Ryan, Jr. participated in the Texas litigation and filed suit in Delaware on August 20, 2007. The Texas court denied a preliminary injunction application on November 13, 2007. The Court of Chancery issued its opinion on July 29, 2008 denying summary judgment on the Revlon and deal protection claims. This Court accepted the directors' application for certification of an interlocutory appeal on September 15, 2008.

Osborne Computer Corporation was founded in 1980 by entrepreneur Adam Osborne and began manufacturing the Osborne I portable personal computer for the mass market, with shipments starting in 1981. By fall 1982, sales of the company's sole product had reached $10 million per month, making the company one of the fastest growing enterprises in the history of American business. In 1981 and again in 1982, the company retained Arthur Young & Company to audit its financial statements and issue audit reports. Arthur Young issued unqualified audit opinions on the company's 1981 and 1982 financial statements. The 1982 opinion was issued on February 11, 1983, appeared on Arthur Young's letterhead addressed to the company, and 100 copies of the professionally printed opinion were personally delivered to the company. The 1982 financial statements reported a modest net operating profit of $69,000 on sales of more than $68 million. In late 1982 the company postponed a planned initial public offering and instead issued warrants to investors in exchange for bridge financing loans or letters of credit. Plaintiffs, a group that included individuals as well as pension and venture capital funds, invested in the company in early 1983; one plaintiff, Robert Bily, purchased 37,500 shares of stock from Adam Osborne for $1.5 million. With one exception, plaintiffs testified that they made their investments in reliance on Arthur Young's unqualified 1982 audit opinion. After the warrant transaction closed on April 8, 1983, sales declined sharply because of manufacturing problems with the company's new Executive model computer, the public offering never occurred, and the company filed for bankruptcy on September 13, 1983, causing plaintiffs to lose their investments. Plaintiffs brought separate lawsuits against Arthur Young in Santa Clara County Superior Court that were consolidated for trial. Plaintiffs' expert witness identified more than 40 deficiencies in the 1982 audit amounting to gross professional negligence, including an understatement of liabilities by approximately $3 million that turned the reported $69,000 profit into a loss of more than $3 million, and testified that Arthur Young had discovered but failed to disclose material weaknesses in the company's internal accounting controls. After a 13-week trial the jury returned a verdict for plaintiffs on the professional negligence claim and awarded approximately $4.3 million in compensatory damages, but found for Arthur Young on the fraud and negligent misrepresentation claims. The trial court granted Arthur Young's motion for judgment notwithstanding the verdict on the negligence claim. The Court of Appeal reversed the judgment in favor of Arthur Young. The Supreme Court of California granted review.