SPAC Litigation Drives Record Number of M&A Settlements in Delaware as Values Drop
A new Cornerstone Research report reveals that the number of settlements related to mergers and acquisitions (M&A) litigation in the Delaware Chancery Court reached a record high of 25 cases last year, marking its highest level since 2012. However, aggregate settlement amounts fell sharply to $326.6 million from an inflation-adjusted peak of $734.8 million in 2023. The decline is attributed largely to the surge in litigation over special purpose acquisition companies (SPACs), which typically involve smaller claims and lower damages. The report highlights that SPAC-related settlements accounted for 68% of all cases in 2025, with an average settlement value of $10.1 million. Traditional M&A settlements also saw a drop, averaging $19.4 million compared to $41.5 million the previous year. The median settlement as a percentage of transaction value fell further to 0.5% in 2025 from a high of 3.9% in 2020. The data also shows that larger claims tend to result in higher settlements, but the proportion awarded relative to claimed damages decreases with claim size. Additionally, plaintiff counsel fees reached their lowest levels due to smaller settlement amounts and reduced fee percentages.
Topics: Legal Litigation Mergers and Acquisitions Settlement Trends SPACs