Law360 (January 26, 2022, 7:32 PM EST) -- A Delaware court on Wednesday tossed out a lawsuit challenging Noble Energy Corp.'s $13 billion merger with Chevron Corp. in 2020, dismissing arguments from investors that they should have been informed about a potential partial sale offer made years earlier.

Delaware Vice Chancellor Sam Glasscock III dismissed the class action lawsuit filed by stockholders Stephanie Galindo and David Walsh against the former directors for Noble, which accused management insiders of neglecting to disclose a 2018 offer from U.K.-based Cynergy Capital Ltd. for Noble's drilling rights in the eastern Mediterranean to assure personal gains from a full change of control.

The judge wrote in an opinion that the investors failed to prove that they should have been told about the 2018 slide deck from Cynergy, saying, among other things, that because negotiations never commenced for the deal and too much time had passed, the event was not material information.

"Even drawing all reasonable inferences in favor of the plaintiffs, the alleged failure to fully inform stockholders with respect to the Cynergy proposal cannot survive," Vice Chancellor Glasscock said.

"The Cynergy proposal, to be found material, must have been significant enough to alter the 'total mix' of information in the marketplace at the time the stockholder vote was solicited. I do not find that it was," the judge said.

The deal was announced in July 2020 and saw Noble Energy's shareholders take 0.1191 Chevron shares for each Noble Energy share.

The suit was filed in January 2021 and alleged that in the stock-and-debt deal with Chevron, Noble's board and management failed to immediately disclose the Cynergy outreach and failed to initially disclose in proxy statements whether Cynergy was contacted when the company began exploring a sale of the eastern Mediterranean assets to other parties in 2019.

At oral arguments in November, counsel for Noble's board and former President and CEO David L. Stover told the court that the offer from Cynergy was never more than a preliminary, immaterial expression of interest.

Michael Rayfield of Mayer Brown LLP also argued that the adoption of "change of control" benefits for executives during talks with Chevron on the 2020 merger — branded in the suit as creating bias for the deal — were a relatively common "golden parachute" consideration for top employees faced with potential postmerger job losses.

On Wednesday, Vice Chancellor Glasscock sided with the executives, saying among other things that it was not the court's place to second-guess the judgment of the majority of shareholders who approved the transaction given that they were not coerced.

"Put another way, the agency problems that support judicial review of the actions of fiduciaries are alleviated where the principals — the stockholders — have the opportunity to, and have, approved the transaction," the judge wrote.

Counsel for the parties did not immediately respond to requests for comment.

The proposed class is represented by Blake A. Bennett of Cooch and Taylor PA and Juan E. Monteverde of Monteverde & Associates PC.

Noble Energy Inc. executives are represented by Kenneth J. Nachbar and Alexandra M. Cumings of Morris Nichols Arsht & Tunnell LLP and Robert S. Harrell, Charles S. Kelley, Joseph De Simone and Michael Rayfield of Mayer Brown LLP.

The case is Stephanie Galindo and David Walsh v. David L. Stover et al., case number 2021-0031, in the Court of Chancery of the State of Delaware.