In Bonham v. HVH Holdings, Inc., download file, the court was called upon to interpret the provisions of a Stock Purchase Agreement (“SPA”) regarding the type of notice that was a prerequisite to making a claim against a $25 million escrow fund that was created for post-closing liabilities that might arise in connection with the $200 million sale of a business.
I summarized a prior decision in this case here, regarding a motion to stay discovery in light of a related proceeding.
In this decision, the court relied on caselaw for its recitation of basic principles of contract interpretation. Among the disputes involved here was the classification under the SPA of certain claims made for amounts held in escrow, and whether the specific claims were subject to arbitration or not. The procedural posture of the decision was a motion to dismiss under Rule 12(b)(6) which requires the court to allow the claim to proceed if, based on any reasonable inferences drawn most favorable to the non-moving party, a plaintiff would be entitled to relief under any reasonable set of facts properly supported by the complaint and any integral documents incorporated by reference therein. The court, based on that standard, allowed claims to proceed based on both the express provision in the SPA for good faith, as well as the implied covenant of good faith and fair dealing.