Had to smile when reading it. In addition to confirming re-noticing is unnecessary as the amended release is narrower, Zurn also justified it on the basis that “removing a clause that has no legal effect does not adversely affect the putative class”. I recall this was the argument you favoured which the parties didn’t even mention in their letter. Well done!
Well this is what I expected but I get the feeling it will make neither of the extreme parties on social media feel vindicated. The pro settlement didn't get their settlement and those opposed didn't get the Izzo intervention or appeal.
I for one assumed it will be a few more weeks to get a ruling... After reading this opinion, seems the VC wants AMC to justify the timeline before she agrees to miss more dinners with her family, so depending on how good a job they do might take longer.
Because your substack is the only thing I read on the matter, I get your interactions with the 'bros' in a hilariously one-sided manner, like watching the lead in a play share awful things about the Greek chorus in *another* play.
@Chance - what do you think about AMC's articulation in today's filing about timing? They don't give her a specific date, but they indicate a desire to go to market to finance before the lull in late Aug.
I think it's pretty squishy. It certainly doesn't meet the request for a "date certain" and I'm not sure how the Vice Chancellor uses it to justify pushing off the work she has in a dozens of other matters pending before the Court and bumping this further and further ahead in line. It's already expedited, she's already working on it ahead of schedule, there's no doubting that. She's asking them to justify an incredibly onerous request to push out the final opinion along with all the de novo review of objections and exceptions to objections to the Special Master's R&R (now that the scope of approval or rejection will be widened, and they will be swept back in); it's a lot of work, and it will take time. I don't see the urgency to dislocate the rest of her life and docket in the immediate near term, but we'll see how she responds (if at all) to the informal responses, as well as to the motion (presumably after Izzo's reply, which should be forthcoming).
Seems very unlikely they are going to get any financing done pre-labor day. Let's say it takes her a couple weeks to approve this, and lifts the stay, they then need 10+ days with NYSE to effect the changes...you are easily into mid/late August and everyone is at the beach. I suppose they could do an ATM and raise some money before Labor Day, but I'm not sure a week or two is a big deal at this point.
I don't necessarily think a couple of months, but I also don't think a couple of days. I think that the Vice Chancellor has a lot going on, and people dramatically underestimate her workload, and get incredibly solipsistic and myopic about the needs of a single case, forgetting that every decision to prioritize this case means dislocating other matters of critical importance to other parties and people.
@brian do you think they would try to sell shares privately after Labor Day rather than do an ATM offering? If you’re thinking they wouldn’t raise money before Labor Day, it’s probably better for them if Zurn takes her time so there isn’t a long lag between the decision date and when they perceive the capital markets to have sufficient activity.
The answer the attorneys provides is about as good as you can do. The issue is a general deterioration of the finances and the financing conditions, not one that necessarily involves an absolute deadline. Not unlike a transplant patient waiting for a kidney. There is no absolute date but the longer you wait the greater the risk the patient crashes and it is too late to fix.
Understood. So now we have Izzo's stating she'll reply July 31. You think VCZ will tell the parties she'll endeavor to have a reply by X date *or* do you think she'll just drop an opinion on same random date of her choosing? Do you think VCZ would wait to give any guidance to the parties on timing of a decision until after Izzo's reply is in?
I just read Izzo's Motion for Clarification and Defendant's Opposition to Rose Izzo's Motion. Did you see somewhere that Izzo is going to reply to AMC's reply by July 31st?
Yes. The filing was pushed through File & Serve late today because the entire Court was out for the day at an internal event, but of course, MTZ being MTZ couldn't take an entire day "off" (even though it was work) so her staff pushed through one of the only set of alerts that came through for the entire court in the after hours, as I had anticipated she might do. Her work ethic is so predictable lol.
You think VCZ will tell the parties she'll endeavor to have a reply by X date *or* do you think she'll just drop an opinion on same random date of her choosing? Do you think VCZ would wait to give any guidance to the parties on timing of a decision until after Izzo's reply is in?
I gotta say Izzo's counsel writes good letters. I don't think she has a good substantive argument for an injunction to let her appeal, but this is definitely not just a retail shareholder writing their own letters making up arguments. Who is Izzo and how is she financing this legal work I wonder?
It's not going to be that much, if the conversion happens, the merged stocks will trade in the $2.50 range...AMC's price is being held up by the short squeeze, they won't get anything close to it when they start selling.
That is a big IF. If the conversion does not happen, or if there is no clarity when it will happen, and AMC needs to issue APEs, it will be sub $1. It might even have to be as low as what Antara paid for theirs.
So… what does this timeline look like now? Isn’t she opening the door to quickly accepting the settlement by asking for details of their financial circumstances?
I mean, the Court of Chancery and VCZ can move mountains when it's necessary, but necessary is a very high standard, so we're going to have to see what their evidence for the necessity of mountain-moving looks like.
Not necessarily. I think the financial evidence is more to support the need for an expedited approval. I think the issue of whether she approves or denies it on the merits is a separate one.
I have, a bit. We've written about it a lot in our main publication, and she discussed it a lot at the hearing -- it's very nuanced what's going on there because it was an incredibly new opinion that everyone was just starting to sort out like a day or two before the hearing. I'll try to do a recap tonight of what we know about how that all lands. It's not entirely clear what it means, in fact, that's why she's asking for supplemental briefing on it, because in a lot of ways, it's not clear how it impacts this case, and she wants some assistance in making sure she is seeing all the angles on how it might / should / could / would, I think.
Her letter reads so weird, like “hey son, you didn’t do what I asked you to the other day, even though I asked 5 times, and you should have done it months ago, but yes you can borrow the car.”
This is more "I'm not going to order you to do things to keep you out of trouble -- keeping yourself out of trouble is your job, not mine" energy. "If we're going back to litigation, it's my job to make sure the wheels don't fall off, but if the settlement is under consideration, I'll consider this hinky thing if that's what you really want, but caveat submittor," I've told you just in the last paragraph you should really take care of this.
Are the lawyers for these parties really the crème de la crème in corporate security law? I’m a bit flabbergasted that they miss so much in their arguments and are so slow to advance the case, at least based on the shade VCZ is throwing.
I'm kidding, that Tonic song just popped into my head.
All that is to say, I'm sure they have their reasons for what they do, and I'm sure they think that they are great reasons, sincerely held. Obviously. I mean, people rarely act in a way that they genuinely think is suboptimal. 😂
Perhaps the perceived sense of urgency is trumping the normal process to dot the i's and cross the t's. For the rates that are being charged, you would think they could do better than this.
@chance does VCZ have full discretion over her response length? You know how sometimes the US Supreme Court just says “here’s what the decision is,” and doesn’t bother to elaborate? Can VCZ do that, or does she have to output another +80 pages? I’m kind of amazed she had to issue +60 pages on the release breadth only for the parties to immediately strike out the offending language and send it back.
I know, I was just in a state from a long day where people were making comments questioning me in ways that were almost equally as ridiculous but frfr. But you should know that I literally am all ten judicial officers on the Delaware Court of Chancery and all twenty-two of their clerks, and we all run on ChatGPT. 😆
Two thoughts about VC Zurn’s latest missive: (1) She is really annoyed with the parties for not filing the amended complaint that she has asked for four times. But she seems ready to let that go. We may never see it. (2) I bet Zurn has vacation time in August. Because I read that letter as telling AMC that they need to come up with a very compelling story about why they need the case decided right now and, if they don’t, we may not see the final decision until September. If we have a pool, I’d go with Thursday of Labor Day week.
Ok, here are the three documents that AMC filed in response to the Vice Chancellor's letter op request, and everything all in one place:
https://chancery.ink/AMCFilingreBusinessNeeds
https://chancery.ink/AMCCosterResponse
https://chancery.ink/AMCResponsetoIzzoMotion
https://chancery.ink/AMCplaintiffsresponse
https://thechancerydaily.substack.com/p/amc-if-one-more-bro-says-this-im
https://chancery.ink/izzomotionclarification
Thanks again Chance.
Had to smile when reading it. In addition to confirming re-noticing is unnecessary as the amended release is narrower, Zurn also justified it on the basis that “removing a clause that has no legal effect does not adversely affect the putative class”. I recall this was the argument you favoured which the parties didn’t even mention in their letter. Well done!
Well this is what I expected but I get the feeling it will make neither of the extreme parties on social media feel vindicated. The pro settlement didn't get their settlement and those opposed didn't get the Izzo intervention or appeal.
I for one assumed it will be a few more weeks to get a ruling... After reading this opinion, seems the VC wants AMC to justify the timeline before she agrees to miss more dinners with her family, so depending on how good a job they do might take longer.
Pretty sure they won’t do a good job.
Because your substack is the only thing I read on the matter, I get your interactions with the 'bros' in a hilariously one-sided manner, like watching the lead in a play share awful things about the Greek chorus in *another* play.
@Chance, do the defendants have to answer judge Zurn’s request (“b”) for a letter brief on Coster v UIP, or is the plaintiff’s answer sufficient?
Here's their response: https://chancery.ink/AMCCosterResponse
Missed that, thank you! 🙏🏼
@Chance - what do you think about AMC's articulation in today's filing about timing? They don't give her a specific date, but they indicate a desire to go to market to finance before the lull in late Aug.
I think it's pretty squishy. It certainly doesn't meet the request for a "date certain" and I'm not sure how the Vice Chancellor uses it to justify pushing off the work she has in a dozens of other matters pending before the Court and bumping this further and further ahead in line. It's already expedited, she's already working on it ahead of schedule, there's no doubting that. She's asking them to justify an incredibly onerous request to push out the final opinion along with all the de novo review of objections and exceptions to objections to the Special Master's R&R (now that the scope of approval or rejection will be widened, and they will be swept back in); it's a lot of work, and it will take time. I don't see the urgency to dislocate the rest of her life and docket in the immediate near term, but we'll see how she responds (if at all) to the informal responses, as well as to the motion (presumably after Izzo's reply, which should be forthcoming).
Seems very unlikely they are going to get any financing done pre-labor day. Let's say it takes her a couple weeks to approve this, and lifts the stay, they then need 10+ days with NYSE to effect the changes...you are easily into mid/late August and everyone is at the beach. I suppose they could do an ATM and raise some money before Labor Day, but I'm not sure a week or two is a big deal at this point.
Poor bros at the Hamptons might have to get out their phones and do some work. Woe betide them.
A couple weeks until an approved settlement is reasonable or generous? It has been sounding like you’re thinking a couple months is more likely.
I don't necessarily think a couple of months, but I also don't think a couple of days. I think that the Vice Chancellor has a lot going on, and people dramatically underestimate her workload, and get incredibly solipsistic and myopic about the needs of a single case, forgetting that every decision to prioritize this case means dislocating other matters of critical importance to other parties and people.
Ha. So somewhere between 2-60 days.
Hasn’t she already made up her mind though? Would it be unprecedented to approve settlement and get into a detailed response at a later date?
The bankers won't even bother trying in late August, unless they are at death's door. A lot more people will answer the phone post Labor Day.
@brian do you think they would try to sell shares privately after Labor Day rather than do an ATM offering? If you’re thinking they wouldn’t raise money before Labor Day, it’s probably better for them if Zurn takes her time so there isn’t a long lag between the decision date and when they perceive the capital markets to have sufficient activity.
The answer the attorneys provides is about as good as you can do. The issue is a general deterioration of the finances and the financing conditions, not one that necessarily involves an absolute deadline. Not unlike a transplant patient waiting for a kidney. There is no absolute date but the longer you wait the greater the risk the patient crashes and it is too late to fix.
Understood. So now we have Izzo's stating she'll reply July 31. You think VCZ will tell the parties she'll endeavor to have a reply by X date *or* do you think she'll just drop an opinion on same random date of her choosing? Do you think VCZ would wait to give any guidance to the parties on timing of a decision until after Izzo's reply is in?
I just read Izzo's Motion for Clarification and Defendant's Opposition to Rose Izzo's Motion. Did you see somewhere that Izzo is going to reply to AMC's reply by July 31st?
Yes. The filing was pushed through File & Serve late today because the entire Court was out for the day at an internal event, but of course, MTZ being MTZ couldn't take an entire day "off" (even though it was work) so her staff pushed through one of the only set of alerts that came through for the entire court in the after hours, as I had anticipated she might do. Her work ethic is so predictable lol.
https://chancery.ink/AMCIzzoLetterReReply
You think VCZ will tell the parties she'll endeavor to have a reply by X date *or* do you think she'll just drop an opinion on same random date of her choosing? Do you think VCZ would wait to give any guidance to the parties on timing of a decision until after Izzo's reply is in?
I gotta say Izzo's counsel writes good letters. I don't think she has a good substantive argument for an injunction to let her appeal, but this is definitely not just a retail shareholder writing their own letters making up arguments. Who is Izzo and how is she financing this legal work I wonder?
Counsel probably working on contingency, Izzo just serving as named Plaintiff.
Is the entire court out next week as well? I don't see a calendar available for next week on the website. https://courts.delaware.gov/calendars/list.aspx?ag=Court%20Of%20Chancery&sec=Calendars
Calendars come out weekly on Friday afternoons. The Court has a full schedule next week.
Are you saying a $100 Million a quarter is chump change for VC Zurn?
It is impossible to predict how many APEs AMC might issue during a
stay pending appeal, but the Company’s recent APE sales provide some guidance.
In 2022, AMC sold approximately 207.8 million APE units.37 During the first
quarter of 2023, AMC sold approximately 49.3 million APE units.38 Assuming
AMC sells approximately 50 million APEs a quarter, as it has recently done, and
assuming a similar trade differential between common stock and APEs continues,
the damages AMC would incur if the Court were to stay its judgment pending appeal
would be well over $100 million a quarter.39, 40
It's not going to be that much, if the conversion happens, the merged stocks will trade in the $2.50 range...AMC's price is being held up by the short squeeze, they won't get anything close to it when they start selling.
That is a big IF. If the conversion does not happen, or if there is no clarity when it will happen, and AMC needs to issue APEs, it will be sub $1. It might even have to be as low as what Antara paid for theirs.
The conversion is going to happen, one way or the other. Just a question of when. Highly likely in the next 90 days, probably sooner.
Do you have a link to the filing?
Thank you!
Here's one: https://chancery.ink/AMCResponsetoIzzoMotion
Thank you!
So… what does this timeline look like now? Isn’t she opening the door to quickly accepting the settlement by asking for details of their financial circumstances?
No. She’s saying if you want me to keep this on an expedited schedule, you’d better seriously prove why it’s necessary.
Thanks. And if they do, what’s the best she can do you think?
I mean, the Court of Chancery and VCZ can move mountains when it's necessary, but necessary is a very high standard, so we're going to have to see what their evidence for the necessity of mountain-moving looks like.
Not necessarily. I think the financial evidence is more to support the need for an expedited approval. I think the issue of whether she approves or denies it on the merits is a separate one.
Can they submit their dire financial situation argument privately?
Have you already talked about the case VC Zurn mentions in today's letter - Coster v. UIP Companies - and how it relates to this case?
I have, a bit. We've written about it a lot in our main publication, and she discussed it a lot at the hearing -- it's very nuanced what's going on there because it was an incredibly new opinion that everyone was just starting to sort out like a day or two before the hearing. I'll try to do a recap tonight of what we know about how that all lands. It's not entirely clear what it means, in fact, that's why she's asking for supplemental briefing on it, because in a lot of ways, it's not clear how it impacts this case, and she wants some assistance in making sure she is seeing all the angles on how it might / should / could / would, I think.
Is there a transcript of the June 29/30 hearing?
The full text of the transcript is available for purchase from the Chancery Court Reporters. To order, call (302) 255-0533.
Thank you!
Third: does not sound good
Her letter reads so weird, like “hey son, you didn’t do what I asked you to the other day, even though I asked 5 times, and you should have done it months ago, but yes you can borrow the car.”
This is more "I'm not going to order you to do things to keep you out of trouble -- keeping yourself out of trouble is your job, not mine" energy. "If we're going back to litigation, it's my job to make sure the wheels don't fall off, but if the settlement is under consideration, I'll consider this hinky thing if that's what you really want, but caveat submittor," I've told you just in the last paragraph you should really take care of this.
Are the lawyers for these parties really the crème de la crème in corporate security law? I’m a bit flabbergasted that they miss so much in their arguments and are so slow to advance the case, at least based on the shade VCZ is throwing.
Well [they] got [their] reasons /
And [they] got [their] [whys] /
And [their] got [their] manipulations /
[I'm sure they could justifyyyyy] 🎶
I'm kidding, that Tonic song just popped into my head.
All that is to say, I'm sure they have their reasons for what they do, and I'm sure they think that they are great reasons, sincerely held. Obviously. I mean, people rarely act in a way that they genuinely think is suboptimal. 😂
Perhaps the perceived sense of urgency is trumping the normal process to dot the i's and cross the t's. For the rates that are being charged, you would think they could do better than this.
Ironically, they are also moving very slowly.
That’s generous of you to assume the apparent ineptitude is purposeful ! I hope they know what they’re doing.
[think] they do, at least
GOOD CHANCE LAWYER
Sean: it’s not your fault.
Chance: I know.
Sean: no, no you don’t, it’s not your fault.
Chance: I know.
Sean: it’s not your fault
Chance: alright
Sean: it’s not your fault
Chance: Don’t fuck with me Sean, not you
Sean: it’s not your fault. Fuck them. Ok?
😆😆😆😆😭😭😭😭
MAKE GHOST PENCILING™️ GREAT AGAIN!!!!
👀
@chance does VCZ have full discretion over her response length? You know how sometimes the US Supreme Court just says “here’s what the decision is,” and doesn’t bother to elaborate? Can VCZ do that, or does she have to output another +80 pages? I’m kind of amazed she had to issue +60 pages on the release breadth only for the parties to immediately strike out the offending language and send it back.
Straw poll: How to account for Chance the Lawyer's uncanny ability to predict the Court's next steps?
1. VCZ reads TCD.
2. TCD clerks for VCZ.
3. TCD *is* VCZ.
Did it not occur to you that I work my ass off and am really smart? 🫠
The truth is the truth is the truth and the law is the law is the law. This is the thing that people forget in this day and age. 🫥🥹
Because also, people said the same thing about Chancellor McCormick. 😂 But guess what the constant is? Me busting my fcking ass.
And yes, I’m just razzing you for all the bros who drove me to almost drink today and I don’t drink. 🤬🥰😇☺️
Okay, phew, I just meant it as a (probably overly cute) way to say, wow, nice work.
I know, I was just in a state from a long day where people were making comments questioning me in ways that were almost equally as ridiculous but frfr. But you should know that I literally am all ten judicial officers on the Delaware Court of Chancery and all twenty-two of their clerks, and we all run on ChatGPT. 😆
CTL is a psychic medium. Duh.
It’s almost certainly the case that at least some of VCZ’s clerks read TCD.
Two thoughts about VC Zurn’s latest missive: (1) She is really annoyed with the parties for not filing the amended complaint that she has asked for four times. But she seems ready to let that go. We may never see it. (2) I bet Zurn has vacation time in August. Because I read that letter as telling AMC that they need to come up with a very compelling story about why they need the case decided right now and, if they don’t, we may not see the final decision until September. If we have a pool, I’d go with Thursday of Labor Day week.