Shareholder Litigation Against Darwin Deason Dismissed

On February 6, 2009, the Delaware Chancery Court granted a motion to dismiss in favor of Darwin Deason, the founder and Executive Chairman of Affiliated Computer Services, Inc. (“ACS”). The ruling closes the final chapter in a highly publicized dispute between Deason and the former outside directors of the ACS board.

In March 2007, Deason and the private equity firm Cerberus announced a proposal to take ACS private. The outside directors objected to the terms of Deason’s arrangement with Cerberus, rejected the Deason-Cerberus proposal and ultimately resigned from the board and sued Deason. ACS shareholders also filed a derivative action against Deason raising many of the same issues that appeared in the outside directors’ complaint. The outside directors dropped their case in November 2007, and the Chancery Court’s ruling on February 6 now ends all litigation arising out of Deason’s proposal to take ACS private and the ensuing dispute with other members of the ACS board.

The Cravath lawyers involved in this matter include partners Robert H. Baron and Gary A. Bornstein and associates David C. Armillei, Craig Batchelor and Benjamin D. Brutlag.