By Brent Kendall
A Delaware judge on Wednesday issued a temporary restraining order that blocks Cigna Corp. from immediately terminating its troubled $48 billion merger with rival health insurer Anthem Inc.
The development is the latest in what could be a long and bitter legal battle between the two companies in the wake of a federal judge's ruling earlier this month that the proposed merger violates U.S. antitrust law.
Cigna on Tuesday declared it was done with the merger and sued Anthem, seeking a $1.85 billion breakup fee plus more than $13 billion in damages from its deal partner. Anthem then responded with its own lawsuit and sought an immediate order stopping Cigna from ending their pact.
Anthem obtained such an order Wednesday from Vice Chancellor J. Travis Laster, a judge on the Delaware Chancery Court, according to a Thursday filing by Cigna with the Securities and Exchange Commission.
Under the terms of the merger agreement, Anthem could extend the deal until the end of April. The firm is making a long-shot bid to win a quick appeal of U.S. District Judge Amy Berman Jackson's ruling that the merger would unlawfully harm consumers and competition.
Both Anthem and Cigna have accused one another of violating their 2015 merger deal. Cigna said Anthem's alleged violations meant it couldn't extend the merger agreement until April. Anthem said Cigna has been engaged in a campaign to sink the deal.
Cigna in a statement said, "This is not a decision on the merits of the case, but rather a procedural order to ensure irrevocable actions do not take place before the court's substantive review of the issues. Cigna respects the court's decision and will continue to abide by terms of the merger agreement until the court further reviews the case."
The insurer said another hearing will be scheduled the week of April 10.
Anthem didn't respond to a request for comment on the restraining order.
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