A judge in Delaware has made a ruling in a years-long legal battle between two major health insurance companies. Indianapolis-based Anthem Inc. (NYSE: ANTM) and Cigna Corp. (NYSE: CI) in Connecticut had been locked in a court battle since a proposed $54 billion merger was terminated in 2017.
After the deal was terminated Cigna said it planned to seek a $1.85 million reverse termination fee from Anthem, which followed a lawsuit filed three months prior that also sought $13 million in damages.
Judge Travis Laster in the Delaware Court of Chancery said “this is a breach of contract case” with each party claiming the other had breached the terms of the merger agreement.
Laster said Anthem was able to prove Cigna breached its obligations, but Cigna proved that the merger was unlikely to be approved by federal regulators. He added that Cigna failed to prove that it is entitled to the reverse termination fee.
As a result, the judge said that neither party was entitled to damages.
“This outcome leaves the parties where they stand. Neither side can recover from the other. Each must deal independently with the consequences of their costly and ill-fated attempt to merge,” said Laster. “In this corporate soap opera, the members of executive teams at Anthem and Cigna played themselves. Their battle for power spanned multiple acts. Each party must bear the losses it suffered as a result of their star-crossed venture.”
You can view the full, 300-page opinion by clicking here.