Dexter had sought court action as part of its defense against ISP’s hostile takeover bid, launched late last year. Dexter said ISP was seeking to expand Dexter’s board so it could elect a majority of directors who favored ISP’s takeover plan.

ISP Chairman Samuel Heyman said his company was reviewing its legal options in light of the ruling. "I can assure you that this will not affect in any way our decision to go forward here, and we're not going away," Heyman said in a statement issued by the company.

Just prior to the court ruling, ISP had reduced its bid for Dexter to $45 per share, the amount of ISP’s original offer in December. ISP had increased its bid to $50 per share before announcing it would revert to the $45-per-share offer.

Dexter said it was pleased with the court ruling and said it "would be proceeding as expeditiously as possible with its campaign to maximize shareholder value in the short term."

Dexter Chairman and CEO K. Grahame Walker said he was "disappointed" by ISP’s announcement that it was reducing its offer. He said Dexter would continue to seek a "fair, definitive and non-contingent contract offer for all of Dexter from ISP or another third party."