In the latest iteration of the ongoing litigation involving CBS Corporation and its controlling stockholder, the Court of Chancery recently provided a textbook summary of the general rule that directors have the right to unfettered access to corporate data, with three general exceptions. In the case styled In re CBS Corporation Litigation, Consol. C.A. No. … Continue Reading
A recent decision of the Delaware Court of Chancery provides a mini-treatise on the capacious capacity of the court to fashion creative and customized remedies when a breach of fiduciary duty is found. The 126-page opinion in the matter of Basho Technologies Holdco B, LLC v. Georgetown Basho Investors, LLC, C.A. No. 11802-VCL (Del. Ch., … Continue Reading
A recent Delaware Court of Chancery opinion explained the meaning of undefined terms in a limited partnership agreement which required the general partner in the Limited Partnership to use “best efforts” and “sound business practices.” In connection with claims that the general partner breached the agreement, the court in Wenske v. Blue Bell Creameries, Inc., … Continue Reading
The Delaware Court of Chancery found that a forum selection clause that was merely permissive rather than exclusive, did not justify enforcing one forum only. In the case styled In re Bay Hills Emerging Partners, I, L.P., C.A. No. 2018-0234- JRS (Del. Ch. July 2, 2018), the court was presented with a case challenging the … Continue Reading
The Court of Chancery recently allowed, after trial, a claimant to disregard the corporate entity, which the court found was involved in a fraudulent conveyance. The case styled: Fringer v. Kersey Homes, Inc., C.A. No. 9780-VCG (Del. Ch. June 25, 2018), begins with the following three sentences: “The great advantage of the corporate form is … Continue Reading
The Delaware Court of Chancery in Daugherty v. Highland Capital Management, L.P., C.A. No. 2017-0488-SG (Del. Ch. June 29, 2018), primarily addressed the issue of laches and equitable tolling that constituted the majority of the 29-page decision, but the last two pages relating to indemnification are the most memorable parts of the opinion. The procedural history … Continue Reading
A recent Court of Chancery opinion provides a useful reiteration of the reasons why the entire fairness standard will apply to a transaction between a controller and a controlled corporation. The case of In Re Hansen Medical, Inc. Stockholders Litigation, C.A. No. 12316-VCMR (Del. Ch. June 18, 2018), arose from a squeeze-out merger. The court addressed … Continue Reading
A recent letter ruling of the Delaware Court of Chancery awarded interim fees based on a fee-shifting contract provision, prior to the final conclusion of the case, based on pre-trial rulings on issues covered by the fee-shifting clause. In Sparton Corporation v. O’Neil, C.A. No. 12403-VCMR (Del. Ch. June 18, 2018), the court addressed that fee issue … Continue Reading
The recent Delaware Court of Chancery opinion in Deutsch v. ZST Digital Networks, Inc., C.A. No. 8014-VCL (Del. Ch. June 14, 2018), addresses the court of equity’s authority to issue arrest warrants to enforce its orders. But because it involves facts that are so unusual, for purposes of a short blog post, the only aspect of the decision that is … Continue Reading
The Delaware Court of Chancery in a recent opinion reiterated the definition of the fiduciary duty of loyalty and explained the flexibility that it has as a court of equity in fashioning a remedy for the breach of that duty. In CertiSign Holding, Inc. v. Kulikovsky, C.A. No. 12055-JRS (Del. Ch. June 7, 2018), the … Continue Reading
In a recent Delaware Court of Chancery decision in Edinburgh Holdings, Inc. v. Education Affiliates, Inc., C.A. No. 2017-0500-JRS (Del. Ch. June 6, 2018), the court addressed certain procedural rules that should be of interest to corporate and commercial litigators to the extent that the court explains when certain causes of action may or may … Continue Reading
A recent decision of the Delaware Court of Chancery provides useful definitions and explanations for well-established principles applicable to corporate litigation. The opinion in Steinberg v. Bearden, C.A. No. 2017-0286-AGB (Del. Ch. May 30, 2018), involves claims that a board of directors and two of its officers breached their fiduciary duties by making or permitting … Continue Reading
Deciding an issue of first impression, the Delaware Court of Chancery recently ruled that even though it imposed fees, after trial, for bad faith litigation as an exception to the American Rule, and that ruling was affirmed by the Delaware Supreme Court, the trial court was without power to impose additional fees, subsequent to the … Continue Reading
A recent Court of Chancery decision elucidated several principles applicable to a motion to dismiss for failure to state a claim pursuant to Rule 12(b)(6). In The Dow Chemical Company v. Organik Kimye Holding, A.S., C.A. No. 12090-VCG (Del. Ch. May 25, 2018), the court explained several principles applicable to Rule 12(b)(6) motions that are eminently … Continue Reading
In a high-profile expedited control contest covered on the front page of The Wall Street Journal and most of the major media outlets covering business, law or Hollywood, the Court of Chancery denied the request for a TRO by a minority stockholder that sought to thwart the efforts of the Redstone family from exercising its … Continue Reading
A recent Delaware Court of Chancery decision addressed claims against the manager of an LLC that required the interpretation of an exculpatory clause and contractually-defined fiduciary duties in the LLC Agreement. MHS Capital LLC v. Goggin, C.A. No. 2017-0449-SG (Del. Ch. May 10, 2018). Brief Background Facts: The detailed facts of this opinion fill about … Continue Reading
A recent decision of the Delaware Court of Chancery provides a cautionary tale for corporate and commercial litigation practitioners about the importance of complying with contractual notice deadlines. In PR Acquisitions, LLC v. Midland Funding LLC, C.A. No 2017-0465-TMR (Del. Ch. April 30, 2018), the court barred a claim made for funds held in escrow … Continue Reading
Any commercial or corporate litigator who needs to pursue claims against a dissolved entity should read the recent Delaware Court of Chancery opinion in Capone v. LDH Management Holdings LLC, C.A. No. 11687-VCG (Del. Ch. April 25, 2018). In essence, the court nullified the certificate of cancellation that had dissolved the LLC in this case because … Continue Reading
A recent decision from the Delaware Court of Chancery provides practical insights into the requirements for imposing personal jurisdiction in Delaware over non-residents involved in the formation of a Delaware entity. The act of forming a Delaware entity only, without more, is not sufficient to impose personal jurisdiction in Delaware over a non-resident involved in the formation. The … Continue Reading
In the context of cross-claims of fraudulent inducement by parties to a merger, the Court of Chancery discussed several principles of Delaware law that serve as useful references for those involved in corporate and commercial litigation. The opinion in LVI Group Investments, LLC v. NCM Group Holdings, LLC, C.A. No. 12067-VCG (Del. Ch. Mar. 28, … Continue Reading
Recent decisions of the Delaware courts have provided arguments for considering a broader approach to the more traditional “four corners of the document” view of contract interpretation for so-called unambiguous agreements. The recent Chancery decision in Plaze, Inc. and Apollo Aerosole Industries LLC v. Callas, C.A. No. 2017-0432-TMR (Del. Ch. Mar. 29, 2018), addresses contract … Continue Reading
The Delaware Court of Chancery addressed a bevy of basic corporate litigation principles in the context of claims challenging the actions of directors, and determining which standards of review apply, and which procedural prerequisites need to be satisfied. In Carr v. New Enterprise Associates, Inc., C.A. No. 2017-0381-AGB (Del. Ch. Mar. 26, 2018), claims for … Continue Reading
The practical problem of proving a breach of fiduciary duty without being able also to prove damages was recently addressed by the Delaware Court of Chancery in a post-trial opinion styled The Ravenswood Investment Company, L.P. v. The Estate of Bassett S. Winmill, et al., C.A. No. 3730-VCS (Del Ch. Mar. 22, 2018). Several of … Continue Reading
A recent decision of the Delaware Court of Chancery discusses the interplay between the business judgment rule and section 144 of the Delaware General Corporation Law (DGCL). Section 144 provides some defenses to what would otherwise be easily challenged, conflicted transactions involving directors. Professor Stephen Bainbridge, well known to readers of this blog and often … Continue Reading
