Loews's Legal Labyrinth: A $700M Question Returns to Delaware Court

NEW YORK, NY – December 11, 2025 – For Loews Corporation (NYSE: L), the ghost of a 2018 transaction continues to haunt its balance sheet. In a dramatic turn, the Delaware Supreme Court has breathed new life into a seven-year legal battle over the company’s acquisition of its Boardwalk Pipelines subsidiary, remanding a key claim back to the lower courts. While most claims were resolved in the diversified holding company's favor, the ruling found a breach in the original partnership agreement and revived the specter of a massive damages award by asking the Court of Chancery to determine if Loews is liable for tortious interference.

The decision prolongs a costly and complex saga, prompting a frustrated response from Loews's leadership. "It goes without saying that we believe that the process we undertook in 2018 to purchase the minority units in Boardwalk Pipelines was appropriate," said Ben Tisch, President and CEO of Loews Corporation. "We are deeply frustrated that this litigation, which has already lasted more than seven years, will continue."

For investors and corporate governance watchers, the ruling is a stark reminder of the long tail of risk in M&A transactions and the formidable power of Delaware's judiciary in policing them. The central issue now is whether Loews, in orchestrating the take-private deal, wrongfully interfered with the partnership contract, a question that could carry a price tag approaching $700 million, plus years of accrued interest.

A Winding Road Through the Courts

The dispute stems from Loews's 2018 move to buy the remaining minority interests in Boardwalk Pipeline Partners, a master limited partnership (MLP) in the natural gas sector. The $1.5 billion transaction was triggered by a change in policy from the Federal Energy Regulatory Commission (FERC) that threatened the tax advantages of the MLP structure. Loews invoked a “call right” in the partnership agreement, allowing it to purchase the minority units at a formula-based price of $12.06 per unit.

What followed was a legal roller coaster:

• November 2021: The Delaware Court of Chancery delivered a stunning blow to Loews, awarding former unitholders approximately $690 million plus interest. The court found that the call right was exercised improperly, ruling that a required legal opinion was not obtained in good faith.

• December 2022: Loews secured a complete reversal from the Delaware Supreme Court. The higher court found that the partnership agreement—which heavily favored the general partner—provided a “conclusive presumption of good faith” when relying on the advice of counsel, effectively shielding Loews from the breach claim as it was then understood. The case was sent back to the Chancery Court.

• September 2024: On remand, the Court of Chancery ruled entirely in Loews's favor, finding no liability based on the Supreme Court's guidance.

This latest ruling from the Supreme Court, however, overturns the clean slate from 2024. While upholding the dismissal of other claims, the court found a distinct “breach in connection with the underlying partnership agreement” and, most critically, sent the tortious interference claim back for another look. The legal chess match is far from over.

Decoding Tortious Interference

The case now hinges on a nuanced but powerful legal concept. A claim for tortious interference alleges that a third party knowingly and without justification interfered with a contract between two other parties, causing a breach and subsequent damages. Here, the plaintiffs argue that Loews Corporation, as the parent company, wrongfully interfered with the contractual relationship between Boardwalk's general partner (which Loews controls) and the minority unitholders.

To succeed, the plaintiffs will need to prove five key elements: the existence of the contract (the partnership agreement), Loews’s knowledge of it, an intentional act by Loews that caused the breach, a lack of justification, and resulting financial injury. The focus in Delaware courts for such claims is often on the defendant’s wrongful inducement of a breach, even if the general partner itself was contractually shielded from liability.

This creates a critical distinction. The 2022 Supreme Court ruling may have protected Boardwalk's general partner via the partnership agreement's exculpatory clauses, but it did not necessarily immunize the parent company, Loews, from claims that it acted as a third-party instigator. The Court of Chancery must now dissect Loews's role in the transaction—from its influence over the legal opinion to its orchestration of the call right—to determine if its actions crossed the line into tortious interference. Precedent from cases like In re CVR Refining, LP Unitholder Litigation shows that Delaware courts are willing to let such claims proceed when there are allegations of a scheme to exercise a call right at an artificially depressed price.

The $700 Million Question Mark

For Loews and its shareholders, the financial stakes are immense. The previously reversed $690 million award serves as a powerful benchmark for potential damages. Should the Chancery Court find Loews liable, interest on any award would accrue from the date of the transaction in 2018. After more than seven years, that interest alone would represent a staggering sum, pushing the total potential liability well beyond the original figure.

This contingent liability hangs over a corporation that is otherwise a model of financial stability. Loews is a diversified powerhouse with major holdings in insurance (CNA), hospitality, and packaging. The company has a proud history of 55 consecutive years of dividend payments and reported a healthy net income of $504 million in the third quarter of 2025. Its stock has been trading above its 200-day moving average, and some analyses suggest it is undervalued.

However, the market abhors uncertainty. This prolonged legal battle represents a significant drain on management focus and financial resources. The renewed risk, however remote Loews believes it to be, will be a key factor for investors assessing the company's valuation. While Loews has the financial heft to absorb a significant judgment, the impact on earnings and investor confidence would be undeniable.

The case is a masterclass in the risks embedded within complex partnership agreements, particularly in the MLP space. The very contractual provisions designed to give general partners maximum flexibility and protection, such as call rights and good-faith presumptions, can become the focal point of intense and costly litigation when exercised. As this case returns to the Chancery Court, the outcome will not only determine Loews's financial fate in this matter but will also serve as a crucial data point for any corporation contemplating similar take-private transactions in the future.