Affiliate of KKR and its board designee obtain dismissal of fiduciary-duty claims in shareholder derivative suit arising from private placement transaction

Client(s) Kohlberg Kravis Roberts & Co. L.P.

Jones Day obtained dismissal of claims asserted against KKR Phorm Investors L.P. and its board designee in shareholder derivative litigation challenging a private placement transaction. The stockholder alleged that the private placement was the result of an unfair process and was at an unfair price, and asserted claims for breaches of fiduciary duty against the board of directors of Transphorm, Inc. and KKR Phorm, as the purported controlling stockholder of Transphorm. The plaintiff also asserted claims for unjust enrichment against KKR Phorm. The Delaware Court of Chancery dismissed all claims with prejudice, finding that demand was not excused as futile.

Newman v. KKR Phorm Investors L.P., et al., No. 2022-0310-NAC (Del. Ch.)