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Sale off, Rohm & Haas falls to $55; sues Dow to force $78 deal UPDATE

Rohm and Haas, Philadelphia, sues Dow Chemical in Delaware Chancery Court after Dow said it can't close their planned merger on schedule.

Shares of Philadelphia chemical maker Rohm and Haas fell more than $10, to around $55, after Dow Chemical said it can't close their planned merger on schedule at $78 a share tomorrow. Rohm sued Dow in Delaware Chancery Court demanding Dow go through with its plan.

The deal blow-up is costly for the Haas family and other big Rohm investors including the American, Barclays, Vanguard, Franklin and Gabelli investment funds, and possibly for deal arbitrage investor John Paulson. Celebrated for betting against subprime lenders, Paulson was Rohm's largest outside shareholder as of last fall. The Wilmington law firm Connolly Bove Lodge & Hutz LLP filed the suit for Rohm.

UPDATE: Rohm vs Dow complaint here; Bob Fernandez's story here.