Boardwalk Pipeline v. Bandera Master Fund LP

Summary

The court reversed the Court of Chancery’s judgment imposing nearly $700 million in damages for Boardwalk’s exercise of a contractual call right to take the partnership private. Reading the partnership and LLC agreements together, the court held that the Sole Member, rather than the GPGP Board, had exclusive authority to determine whether the legal opinion required by the call-right provision was acceptable. The court further held that the General Partner conclusively established good faith by reasonably relying on Skadden’s opinion and was therefore exculpated from damages, while remanding for further proceedings consistent with the opinion.