Madryn Asset Management letter to SomaLogic, Inc
$SLGC
January 2, 2024
By File & ServeXpress and Federal Express
The Honorable Sam Glasscock III
Vice Chancellor
Delaware Court of Chancery
34 The Circle
Georgetown, DE 19947
Re:
Gold et al. v. SomaLogic, Inc. et al., C.A. No. 2023-1249-SG
Dear Vice Chancellor Glasscock:
We write on behalf of non-party Madryn Asset Management, LP (collectively with its affiliates, “Madryn”), a stockholder of SomaLogic, Inc., to respectfully request that the Court consider the lack of public availability of the parties’ filings related to Plaintiffs’ motion for a preliminary injunction and postpone the stockholder vote regarding the proposed stock-for-stock merger between SomaLogic and Standard BioTools Inc. at least until SomaLogic’s stockholders have a chance to review and consider the recently filed submissions in connection with Plaintiffs’ motion. This vote, which takes place before the stockholders can see why SomaLogic’s founder and its current Chief Technology Officer felt compelled to seek this injunction, will not adequately uphold the public’s right of access to these proceedings and permit a fully informed vote consistent with Delaware law.
Currently, the stockholder vote is scheduled for Thursday, January 4, 2024. But Plaintiffs’ brief in support of their motion for preliminary injunction, Defendants’ brief in opposition to Plaintiffs’ motion, and Plaintiffs’ reply brief, as well as all exhibits and affidavits accompanying these submissions, are presently under seal in their entirety, and are not due to be unsealed until after the January 4 stockholder vote. See Ct. Ch. R. 5.1(d) (“[T]he filer of a Confidential Filing shall file a public version within five days after making the Confidential Filing.”). Madryn is not operating in a group with Plaintiffs in this action, and it has not seen any of the confidential filings in this action.
Madryn is running a proxy campaign opposing the proposed merger because of the conflicted process that led to the transaction and the lack of value the merger would offer current shareholders other than Eli Casdin. Madryn’s opposition has been echoed by many institutional stockholders. See, e.g.:
•
Press Release, Boston Millennia Partners, Boston Millennia Partners Intends to Vote Against Proposed Merger of SomaLogic With Standard BioTools (Dec. 31, 2023), http://tinyurl.com/5n7uuakc;
•
Press Release, Tikvah Management, Tikvah Management Announces Intention to Vote against Somalogic’s Proposed Merger with Standard BioTools (Dec. 22, 2023), http://tinyurl.com/44thvmjz;
•
Press Release, Skye Fund III, Skye Fund III Issues Letter Regarding Opposition to SomaLogic’s Proposed Merger with Standard BioTools (Dec. 20, 2023), http://tinyurl.com/4vkb52sh.
But none of the stockholders, nor the proxy advisory firms, have seen the evidence or arguments in this case. The reports and recommendations of proxy advisory firms are highly influential on the voting decisions of shareholders, the vast majority of which rely on the work of such firms before casting their votes. In its voting recommendation for this transaction, Institutional Shareholder Services Inc. wrote that, “[a]lthough there is no evidence in the proxy that other alternatives were not appropriately considered in favor of the merger …, shareholders will want to monitor the outcome of the pending lawsuit for any such evidence” (emphasis added). Shareholders cannot monitor the lawsuit when its most important filings are under seal. See Al Jazeera Am., LLC v. AT & T Servs., Inc., 2013 WL 5614284, at *3 (Del. Ch. Oct. 14, 2013) (“[T]he public’s right of access to court documents … is ‘considered fundamental to a democratic state and necessary in the long run so that the public can judge the product of the courts in a given case.’”). Indeed, Madryn understands from former SomaLogic CEO Roy Smythe that he submitted a lengthy sworn affidavit in connection with Plaintiffs’ motion for a preliminary injunction, but that affidavit is not yet accessible to the public.
Defendants will not be prejudiced if the vote is briefly postponed until after January 9, 2024—the date when all filings related to the PI hearing will be public—to enable SomaLogic’s stockholders to access and process the preliminary injunction briefs and accompanying exhibits and affidavits. Indeed, Defendants admitted at the December 21, 2023 expedition hearing that the merger agreement does not require a shareholder vote before January 14, 2024. See Dec. 21, 2023 Hrg. Tr. at 49 (Exhibit A hereto).
It is critical that stockholders receive full disclosure and be fully informed before they vote on an important transaction like this one. See Dohmen v. Goodman, 234 A.3d 1161, 1168 (Del. 2020) (“When directors request discretionary stockholder action, they must disclose fully and fairly all material facts within their control bearing on the request.”); see also State of Wisconsin Inv. Bd. v. Bartlett, 2000 WL 193115, at *3 (Del. Ch. Feb. 9, 2000) (“I further find that the Medco shareholders will suffer irreparable harm as a matter of law if they must vote for or against the merger on February 10 at 1000 given my findings that they will not have adequate time to receive, absorb and consider the supplement material and consummate a change of their vote on the merger.”). We therefore respectfully request that the Court consider the public availability of the preliminary injunction filings and grant at least so much of Plaintiffs’ request to postpone the vote so that stockholders can review and digest the preliminary injunction filings in this case.
Respectfully submitted,
/s/ Catherine A. Gaul
Source:
https://www.sec.gov/Archives/edgar/data/1787423/000119312524001490/d900071ddfan14a.htm