Lazard Technology Partners, LLC v. Qinetiq North America Operations LLC, No. 464, 2014 (Del. Supr., Apr. 23, 2015). The Delaware Supreme Court interpreted a post-closing earn-out provision and determined that the Court of Chancery was correct when it held that there was no breach of the implied covenant of good faith and fair dealing; plus, there was no evidence that the requirement in the applicable provision had been met, to demonstrate that the buyer intentionally evaded the trigger for an earn-out to be paid. This decision may be unprecedented in its brevity for an en banc Supreme Court opinion, but nevertheless should be required reading for anyone with an issue involving an earn-out provision under Delaware law.
Practice point: drafters should make sure the standard by which an earn-out provision will be reviewed is capable of easy, objective measurement.