Archives: Other Court Decisions

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Large Defamation Damage Award Upheld Against Hewlett-Packard

The opinion in Professional Investigating & Consulting Agency, Inc. v. Hewlett-Packard Co., C.A. No. N12C-06-196 MMJ CCLD (Del. Super. Mar. 23, 2015), applies the Delaware law of defamation in the context of a claim by one business vendor against a large iconic company. The fascinating and scholarly opinion uses the word “humiliation” in the context … Continue Reading

Third Circuit Binds Non-Signatory to Forum Selection Clause

The Third Circuit, applying Delaware law in Carlyle Investment Management LLC v. Moonmouth Company SA, No. 13-3526 (3rd Cir. Feb. 25, 2015), recently bound a non-signatory to a forum selection clause found in a subscription agreement.  The court applied a three part test to determine whether the non-signatory should be bound by the forum selection … Continue Reading

Contract Interpretation Under PA Law

A helpful review of contract interpretation principles under Pennsylvania law was provided in an opinion by the U.S. District Court for the Eastern District of Pennsylvania, styled Artesian Water Company v. Chester Water Authority (E.D. Pa. Sept. 30, 2014). We represented Chester Water Authority in this matter. A prior decision in the same case, also … Continue Reading

U.S. Supreme Court Declines to Hear Appeal of Chancery Arbitration Program

As previously reported on these pages, the U.S. Court of Appeals for the Third Circuit found that a confidential arbitration program sponsored by the Court of Chancery for major business disputes ran afoul of the U.S. Constitution. The U.S. Supreme Court on March 24 declined to accept an appeal of that decision. That leaves the … Continue Reading

Advance Waiver of Future Conflicts Upheld by Federal Court

For my regular ethics column for the current issue of The Bencher, the national publication of the American Inns of Court, I wrote an article about a recent federal court decision that upheld the enforceability of a waiver, in advance, of future conflicts, and discussed the prerequisites for the validity of such a waiver.… Continue Reading

Third Circuit Court of Appeals Certifies Question to Delaware Supreme Court

Doe v. Wilmington Housing Authority, No. 12-3433 (3rd. Cir., July 18, 2013) In essence: This recent decision of the U.S. Court of Appeals for the Third Circuit is somewhat off topic for this blog, but the issue it addresses should be of universal interest because it deals with the natural right of self defense that each person is … Continue Reading

U.S. Supreme Court Court’s Decision In Criminal Case Has Implications For Directors And Officers

This post comes from Frances Goins of Ulmer & Berne in Cleveland.  Frances is the Chair of the ABA Business Law Section’s Subcommittee on Developments in D&O Liability. On June 16, 2013, the U.S. Supreme Court handed down its decision in Salinas v. Texas HERE which resulted from a criminal prosecution in which the defendant, who … Continue Reading

Delaware Holding Company Recognized for Jurisdictional Purposes

Johnson v. Smithkline Beecham Corp., 2013 U.S. App. LEXIS 11501 (3d Cir. June 7, 2013). Issue Addressed: For purposes of diversity jurisdiction, should a holding company’s citizenship be defined by the activities of its limited liability company (LLC) subsidiary given that a holding company’s primary activity is to own and manage, not to operate its assets. … Continue Reading

U.S. Supreme Court Addresses Discharge of Judgment for Breach of Fiduciary Duty

Bullock v. BankChampaign, N.A., No. 11-1518, 2013 U.S. LEXIS 3521 (U.S. May 13, 2013) Issue Addressed: This U.S. Supreme Court opinion considered whether a director found liable for a breach of fiduciary duty could discharge his debts related to that breach in Bankruptcy Court pursuant to 11 U.S.C. § 523(a)(4) of the Bankruptcy Code. The … Continue Reading

Appellate Court Addresses Advancement of Defense Costs in Criminal Proceeding

A recent California appellate court decision, Mt. Hawley Insur. Co. v. Lopez, addresses an important topic regarding the advancement of defense costs when a director or officer is facing criminal prosecution.  The decision was sent to us by our friends Fran Goins and Jim Wing, who are respectively chairs of the Developments and D&O Insurance Subcommittees … Continue Reading

Bankruptcy Court Applies Laches, Not Statute of Limitations to Professionals Who Allegedly Conspired With Fiduciaries

Miller v. Kirkland & Ellis LLP, Adv. No. 12-50713 (PJW) (Bankr. D. Del. Oct. 2, 2012). Tara Lattomus of Eckert Seamans prepared this case summary. Issue Addressed Whether the two year statute of limitations or the equitable doctrine of laches applied to claims against attorneys who allegedly conspired with corporate fiduciaries to defraud their client? … Continue Reading

District Court Disqualifies Firm Due to Client Representation of Over 15 Years Ago

We have written frequently on these pages about decisions that have addressed potential conflicts of interest in the litigation context, both real and imagined, in the state and federal courts. See, e.g., cases and articles on these pages here. The U.S. District Court for the District of Delaware recently disqualified counsel based on a finding of a … Continue Reading

Confidential Court of Chancery Arbitration Proceedings Found Unconstitutional — Violate Qualified Right of Access

Delaware Coalition for Open Government v. Hon. Leo E. Strine, Jr., et al., D. Del. C.A. No. 1:11-1015 (Aug. 30, 2012). Issue Presented: Do the Court of Chancery’s confidential arbitration proceedings violate the First Amendment’s qualified right of access? Answer:  Yes.  As a general rule, proceedings cannot be closed to the public except in limited circumstances.  … Continue Reading

New York Court Adopts Tooley Test for Identifying Derivative v. Direct Actions

The New York Supreme Court Appellate Division, First Department issued a decision in Yudell v. Gilbert, Case No. 600404/08 (Aug. 7, 2012) affirming the dismissal of an action regarding a joint venture.  See decision here.  The Court, in analyzing the difference between a direct and a derivative action, stated that “New York lacked a clear … Continue Reading

The Right to Bear Arms for Self-Defense in Delaware

The U.S. District Court for the District of Delaware recently issued a decision interpreting the Second Amendment to the U.S. Constitution, regarding the right to bear arms, as well as its counterpart in Delaware’s Constitution, as applied to residents of public housing. Doe v. Wilmington Housing Authority. We represent the plaintiff, with assistance from the country’s oldest civil rights … Continue Reading

Arbitrability of Fiduciary Duty Claims in Pennsylvania Law

We often review Delaware cases that address issues of arbitrability. For comparison purposes we bring you two recent decisions of the Pennsylvania Superior Court (the intermediate appellate court in the Keystone State), that addressed the issue of arbitrability in two companion cases involving the issue of whether breach of fiduciary duty claims against a trustee … Continue Reading

Contract Interpretation Principles under PA Law

For those interested in contract interpretation principles under PA law, and in particular when extrinsic evidence will be allowed, such as course of performance and usage of the trade, the recent opinion by the U.S. District Court for the Eastern District of Pennsylvania, in Artesian Water Company v. Chester Water Authority, may be instructive. We represent … Continue Reading

District Court Denies Security Holders Request for Extra Time to Consider Tender Offer for Human Genome Sciences Shares

David v. Human Genome Sciences, Inc., C. A. No. 12-965-SLR (D. Del.) (July 26, 2012). Issue Presented: Did the plaintiffs, security holders of defendant Human Genome Sciences, Inc. (“HGSI”), meet their burden of proof for injunctive relief in order for investors in HGSI to have more time to consider whether to tender their shares? Short … Continue Reading

Third Circuit Limits the Taxation of E-Discovery “Costs” Against the Losing Party

The United States Court of Appeals for the Third Circuit in Race Tires America v. Hoosier Racing Tire Corp., et al., issued a decision on March 16, 2012 on a matter of first impression, vacating the Western District of Pennsylvania’s decision awarding in excess of $365,000 in taxable costs for activities related to e-discovery, such as hard … Continue Reading

Bankruptcy Court Limits Executive Compensation

In re Verasun Energy Corp.,  No. 08-12606 (BLS) (Bankr. D. Del. March 26, 2012) Issue Addressed Whether claims of former executives for money owed under change-in-control agreements should be capped by section 507(b)(7) of the Bankruptcy Code? Short Answer The Bankruptcy Court held that the change in control agreements were employment contracts and that the … Continue Reading

PA Court Refuses to Pierce Veil of LLC

James T. Walmsley and Christopher W. Sullivan v. Frederick H. Ehmann, Steven Fishman, et al., C.A. No. 1845 EDA 2009 (Pa. Super. Ct. Feb. 28, 2012). This decision concerns the Pennsylvania Superior Court upholding the Court of Common Pleas ruling not to pierce the corporate veil of a Pennsylvania LLC, and the factors that are … Continue Reading