Archives: Chancery Court Updates

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Chancery won’t let new challenge to advancement pact delay directors’ legal fee reimbursement

The Court of Chancery recently refused to reconsider its decision that, pending resolution of a challenge to the validity of their indemnification agreements, Stimwave Technologies Inc. must advance defense costs to a CEO and a director in actions by the company and the U.S. Department of Justice. Vice Chancellor Sam Glasscock’s May 13 letter-to-counsel opinion … Continue Reading

Chancery says no controller fiduciary liability for chairman who wasn’t in buyout control group

This post was prepared by Frank Reynolds, who has been following Delaware corporate law, and writing about it for various legal publications, for over 30 years. The Delaware Court of Chancery recently ruled that Connecture Inc.’s Chairman of the Board and his affiliated investment company were not part of a control group accused of breaching … Continue Reading

Court of Chancery says GoPro directors had no duty to doubt managers’ soaring drone camera predictions

This post was prepared by Frank Reynolds, who has been following Delaware corporate law, and writing about it for various legal publications, for over 30 years. The Delaware  Court of Chancery recently grounded a GoPro Inc. investor suit over the troubled launch of the Karma camera drone for failure to show the directors faced liability … Continue Reading

Court of Chancery lets investor sue again over banking execs quid pro quo replacement stock plan

This post was prepared by Frank Reynolds, who has been following Delaware corporate law, and writing about it for various legal publications, for over 30 years. The Delaware Court of Chancery recently allowed the same shareholder who successfully challenged a 2015 Investors Bancorp Inc. director and officer compensation plan to pursue a new suit over … Continue Reading

Chancery Court finds muni bond giant Nuveen used size, “lies” and pressure to squash small rival

This post was prepared by Frank Reynolds, who has been following Delaware corporate law, and writing about it for various legal publications, for over 30 years. The Delaware Chancery Court recently ruled that municipal bond powerhouse Nuveen LLC improperly used “lies” and “threats” in a successful campaign to damage the business of much smaller rival … Continue Reading

Chancery Court finds charges over lululemon board’s CEO exit pact too thin to pass pre-suit demand

This post was prepared by Frank Reynolds, who has been following Delaware corporate law, and writing about it for various legal publications, for over 30 years. The Delaware Court of Chancery recently dismissed a shareholder’s derivative suit because he could not prove lululemon Athletica, Inc.’s directors breached their duty of loyalty by giving ex-CEO Laurent … Continue Reading

Delaware Courts’ Response to the Coronavirus

According to the World Health Organization this afternoon, and a televised announcement from the President of the United States this evening, a novel coronavirus (Covid-19) has now been declared to be a worldwide pandemic. Two other examples of how serious this situation is: The President announced a travel ban from most of Europe to the U.S. … Continue Reading

Claims by Long-Term Close Friend Proceed Against Faithless Business Partner

A recent Delaware Court of Chancery opinion discussed the nuances of an unusual personal and business relationship, akin to a “familial intimacy”, that formed the basis for the court to conclude that a fiduciary relationship could be proven at trial.  See Bamford v. Penfold, L.P., C.A. No. 2019-0005-JTL (Del. Ch. Feb. 28, 2020). Short Overview: … Continue Reading

Chancery: AmTrust squeeze-out must face stiff review after failing MFWcontrolling shareholder test

This post was prepared by Frank Reynolds, who has been following Delaware corporate law, and writing about it for various legal publications, for over 30 years. The Delaware Court of Chancery recently ruled that AmTrust, Inc.’s controlling shareholders’ go-private buyout of the insurer must be reviewed under the harsh light of the entire fairness standard … Continue Reading

Chancery Addresses Liquidated Damages Clause in Non-Competition Agreement

The following synopsis was prepared by Chauna Abner, an attorney in the Delaware office of Eckert Seamans. In Lyons Ins. Agency, Inc. v. Kelly Wark, et al., C.A. No. 2017-0348-SG (Del. Ch., Jan. 28, 2020), the Court of Chancery opined on the enforceability of a liquidated damages provisions in a non-competition agreement. The Court explained … Continue Reading

Chancery Addresses Usurpation of Corporate Opportunity

The following synopsis was prepared by Chauna Abner, an attorney in the Delaware office of Eckert Seamans. In Leased Access Preservation Association v. Ivan Thomas, et al., C.A. No. 2019-0310-KSJM, Order (Del. Ch. Jan. 8, 2020), a non-profit, non-stock corporation filed suit against Ivan Thomas, a former board member of the plaintiff, alleging, in part, … Continue Reading

Anthology of Blurbs About Recent Delaware Corporate and Commercial Decisions

In a departure from the manner in which most cases have been highlighted on these pages, this post includes a collection of short blurbs about recent Delaware corporate and commercial decisions, identifying the key issues addressed, with a link to the whole opinion. This experimental approach to highlighting recent decisions was prompted by a combination … Continue Reading

Chancery finds failure to allege conspiracy means dismissal of ex-director and his foreign firms

This post was prepared by Frank Reynolds, who has been following Delaware corporate law, and writing about it for various legal publications, for over 30 years. The Delaware Court of Chancery recently dismissed the remaining defendants from a lawsuit that Wanu Water Inc.’s founder filed against directors and shareholders who allegedly conspired to seize control, finding a boardroom rival’s … Continue Reading

Chancery: Tesla investors need only prove Musk had coercive influence ability in SolarCity deal

This post was prepared by Frank Reynolds, who has been following Delaware corporate law, and writing about it for various legal publications, for over 30 years. The Delaware Court of Chancery recently found that a trial is needed to decide whether, despite his minority share of Tesla Motors Inc., CEO Elon Musk could exert a controller’s … Continue Reading

Chancery Denies Attorneys’ Fees for Successful Suit to Compel Annual Meeting

The Court of Chancery recently denied a request for attorneys’ fees that were sought pursuant to the corporate benefit doctrine despite a successful suit under Section 211 of the Delaware General Corporation Law (DGCL) to compel a company to hold an annual meeting. In Martin v. Harbor Diversified, Inc., C.A. No. 2018-0762-SG (Del. Ch. Feb. … Continue Reading

Court of Chancery Denies Motion to Dismiss Implied Covenant of Good Faith and Fair Dealing Claim

This post was authored by R. Montgomery (“Monty”) Donaldson, a Delaware business and commercial litigator for many years, a friend and colleague of Francis Pileggi, and a follower of this blog. The implied covenant of good faith and fair dealing has received considerable play in Delaware in recent years. In fact, over the last half-decade, … Continue Reading
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