A recent Delaware Court of Chancery decision must be read by anyone interested in the latest iteration of Delaware law concerning when a non-signatory may be bound by a forum selection clause in an agreement. In Florida Chemical Company, LLC v. Flotek Industries, Inc., C.A. No. 2021-0288-JTL (Del. Ch. Aug. 17, 2021), the court provides
contract interpretation
Chancery: LLC Managers Breached Fiduciary Duties
By Francis Pileggi on
Posted in Court of Chancery Updates
A recent Chancery decision recounts the epic tale of a group of business partners who were longtime friends and who later accused each other, after forming a business together, of fraud and breach of fiduciary duty. In Stone & Paper Investors, LLC v. Blanch, C.A. No. 2018-0394-PAF (Del. Ch. July 30, 2021), the court describes…
Chancery Allows Claims for Breach of Both Fiduciary Duty and Contract Against LLC Manager
By Francis Pileggi on
Posted in Court of Chancery Updates
The Delaware Court of Chancery recently explained under what circumstances dual claims will be allowed to proceed for both breach of fiduciary duty and breach of contract in the context of the manager of an LLC allegedly using LLC assets for his personal benefit in a manner not shared by all the other LLC members.…
Post-Closing Price Dispute Covered by Independent Accountant Clause–Not Legal Issue of Contract Interpretation
By Francis Pileggi on
Posted in Other Court Decisions
A common type of business litigation case in Delaware involves post-closing purchase price adjustments, a variation of often-litigated earn-out disputes. Many agreements for the sale of a business include a provision that appoints an independent accounting firm to resolve disputes regarding a determination post-closing of working capital as of the closing date, for example, which…
Chancery Provides Guidance on Interpretation of LLC Agreement
By Francis Pileggi on
Posted in Court of Chancery Updates
The recent Chancery decision in Pearl City Elevator, Inc. v. Gieseke, C.A. No. 2020-0419-JRS (Del. Ch. March 23, 2021), addressed the issue of whether the procedures in an LLC Agreement were correctly followed, such that a party acquired sufficient ownership interest in order to control the board.
This decision is useful for its recitation of…
16th Annual Review of Key Delaware Corporate and Commercial Decisions
16th Annual Review of Key Delaware Corporate and Commercial Decisions
By: Francis G.X. Pileggi and Chauna A. Abner
This is the 16th year that Francis Pileggi has published an annual list of key corporate and commercial decisions of the Delaware Supreme Court and the Delaware Court of Chancery. This list does not attempt to include…
Conflicting Forum Selection Clauses Addressed
By Francis Pileggi on
Posted in Court of Chancery Updates
A recent Delaware Court of Chancery opinion interpreted related agreements that included forum selection clauses that were conflicting. In Mack v. Rev Worldwide, Inc., C.A. No. 2019-0123-MTZ (Del. Ch. Dec. 30, 2020), the court addressed forum selection provisions in two related agreements which the court treated as one because they were incorporated by reference.
The…
When Tandem Claims May Proceed for Breaches of Both Fiduciary Duty and Contract
By Francis Pileggi on
Posted in Selected Articles by Francis
Yours truly and my colleague Chauna Abner have published an article for the recent issue of The Delaware Business Court Insider on the titular topic. The analysis that determines when dual claims for breach of contract and breach of fiduciary duty based on substantially the same operative facts might survive a motion to dismiss, is…
Chancery says board faction access to rivals’ control dispute discovery ‘depends’ on adversity and standing
By Francis Pileggi on
Posted in Court of Chancery Updates
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.
A discovery ruling by the Delaware Court of Chancery in a contest between two board factions for control of Adkins Energy LLC allowed plaintiff Pearl City Elevator, Inc. access…
Must-Read Chancery Decision for Buyers of Businesses Whose Value Depends on Retaining Customer Relationships
By Francis Pileggi on
Posted in Court of Chancery Updates
A recent Delaware Court of Chancery decision addressed the issue of whether a seller was liable for not disclosing the notification it received prior to closing that one or more key customers were terminating their relationship with the seller’s business. Swipe Acquisition Corporation v. Krauss, C.A. No. 2019-0509-PAF (Del. Ch. Aug. 25, 2020). This…