Solow v. Aspect Resources, LLC, Del. Supr., No. 484, 2011 (Mar. 19, 2012).
Issue Adressed: Does the Court of Chancery have the discretion to dismiss a case due to lack of activity by the plaintiff for over a year and failing to pursue the case?
Short Answer: Yes.
After two motions to dismiss led several years ago to a second amended complaint in this case, the plaintiff propounded discovery requests and took depositions. Thereafter there was no activity by the plaintiff for about two years. In January 2011, the Court of Chancery sent a notice under Court of Chancery Rule 41(e) with notice that it would dismiss the case without further notice absent good cause shown due to lack of prosecution.
The only reasons given for lack of prosecution was that the plaintiff contended he was looking for a new lawyer for over a year but could not find one until about the time he received the Court’s notice. He also argued that he was engaged in settlement negotiations during the same time. The opposing side said that there were no meaningful or detailed settlement discussions. The Court did not buy the argument that it took that long to find a lawyer. The Court explained that if the plaintiff wanted the case to be in abeyance pending settlement talks, he should have filed a motion for stay or entered into a stay stipulation. In sum, Delaware’s Highest Court determined that the trial court did not abuse its discretion in dismissing the case.
Practice Tip to Plaintiffs: Allow a case to languish at your own risk in Delaware.