Tag Archives: Court of Chancery

Chancery Denies Advancement Claim

Emerging Growth Fund, L.P. v. Figlus, C.A. No. 7936-VCP (Del. Ch. Mar. 28, 2013). This Chancery opinion denies a claim for advancement which was made as part of and in the context of a motion for a preliminary injunction to enforce the terms of the parties’ partnership agreement. Applying basic contract interpretation principles, the court found that the … Continue Reading

Chancery and Proxy Puts

Kallick v. Sandridge Energy, Inc., C.A. No. 8182-CS (Del. Ch. Mar. 8, 2013). The highly regarded corporate law scholar Professor Larry Hamermesh has provided his insights on this decision in  highlights available on his blog at The Institute of Delaware Corporate & Business Law. The entire post follows: Chancellor Strine’s March 8, 2013 opinion in Kallick v. SandRidge … Continue Reading

Duties of Directors of Insolvent Company Addressed

Edgewater Growth Capital Partners LP v. HIG Capital, Inc., C.A. 3601-CS (Del. Ch., Feb. 28, 2013). This 70-page decision provides useful and extensive analysis of the duties of directors of an insolvent corporation and related claims against a private equity shareholder who enforced its foreclosure rights. The court dismissed the claims and found that the foreclosure … Continue Reading

Chancery Dismisses Duplicative Delaware Suit in Favor of First-Filed California Case

In Re Diamond Foods, Inc. Derivative Litigation, C.A. No. 7657-CS (Del. Ch. Feb. 28, 2013). Issue Addressed: Whether a derivative suit filed in Delaware should be dismissed in favor of a similar first-filed action in California. Short Answer: Yes. Short Overview of Case The factual background involves alleged manipulation of the financial statements of the company by the … Continue Reading

Chancery Denies Motion to Expedite

In re BioClinica, Inc. Shareholder Litigation, C.A. No. 8272-VCG (Del. Ch. Feb. 25, 2013). This Chancery ruling denied a motion to expedite claims in consolidated cases that were quickly filed to challenge the merger of BioClinica with JLL Partners. The court explained the basis for the denial as the absence of any colorable claims. In … Continue Reading

Chancery Addresses Section 220 Issues

Doerler v. American Cash Exchange, Inc., C.A. No. 7640-VCG (Del. Ch. Feb. 19, 2013). This gem of a Chancery decision provides an excellent overview of both the basic prerequisites of a claim for books and records under DGCL Section 220 as well as the nuances of certain defenses that may be–and may not be available … Continue Reading

Chancery Bars Claims Based on “Issue Preclusion” Doctrine

TR Investors, LLC v. Genger, C.A. No. 6697-CS (Del. Ch. Feb. 18, 2013). Issue addressed: Whether the doctrine of “issue preclusion” prevented the relitigation of issues previously decided, and thus supported the grant of a motion for summary judgment. Short answer: Yes. Short Overview This 58-page opinion chronicles the long and tortuous procedural history of … Continue Reading

Delaware Board’s Fiduciary Duty of Oversight for Foreign Operations

In re Puda Coal, Inc. Stockholders Litigation, C.A. No. 6476-CS (Del. Ch. Feb. 6, 2013)(Bench ruling). Thanks to Tariq Mundiya of Willkie Farr for forwarding the transcript. This bench ruling, highlighted on The Harvard Law School Corporate Governance Blog, for which I am a contributing author, addressed a claim for a breach of the board’s duty of … Continue Reading

Chancery Grants Expedited Proceedings To Consider Appointment of Receiver or Custodian for Insolvent Company

Balch Hill Partners, L.P. v. Shocking Technologies, Inc., C.A. No. 8249-VCN (Del. Ch. Feb. 7, 2013). Issue addressed: Whether expedited proceedings should be granted to consider the appointment of a receiver or custodian for an allegedly insolvent company pursuant to DGCL Sections 291 and 226? Short answer: Yes Brief Overview This letter ruling was in … Continue Reading

Chancery Addresses Default Fiduciary Duties in LLC and Advancement Issues

Zimmerman v. Crothall, C.A. No. 6001-VCP (Del. Ch. Jan. 31, 2013) Issue Presented  This 74-page opinion addresses the allegations of a minority unitholder in an LLC who asserts claims that the directors breached their fiduciary duties in connection with several financing transactions. Brief Overview  Zimmerman claimed that the challenged transactions should be analyzed under the … Continue Reading

Chancery Addresses Two Methods for Dissolving Delaware Corporations; No Receiver Appointed 10 Years after Dissolution and No Claims Allowed after 10 Years

In the Matter of Krafft-Murphy Company, Inc., C.A. No. 6049-VCP (Del. Ch. Feb. 4, 2013). Issue Addressed This case addresses a question of first impression in Delaware: Whether a receiver should be appointed more than 10-years after the dissolution of a Delaware corporation when the dissolved corporation’s only assets are liability insurance policies.  The Court observed that … Continue Reading

Chancery Reiterates Standard for Expedited Proceedings

The Renco Group, Inc. v. MacAndrews AMG Holdings LLC, C.A. No. 7668-VCN (Del. Ch. Jan. 18, 2013). This opinion is noteworthy for purposes of reiterating the well-worn standard that will be applied to a motion seeking expedited discovery and an expedited hearing in connection with a preliminary injunction.  The Court explained that: “The burden on … Continue Reading

LP Agreement Bars Fiduciary Duty Claims

Gerber v. EPE Holdings LLC, C.A. No. 3543-VCN (Del. Ch. Jan. 18, 2013). Short Overview In this 37-page decision, the Court of Chancery dismissed breach of fiduciary duty claims.  The Court declined to impose default fiduciary duties upon the entity’s partners based on a limited partnership agreement that waived all common law fiduciary duties in … Continue Reading

Chancery Selects Lead Counsel in Consolidated Cases

In re:  Freeport-McMoRan Copper & Gold, Inc., Consol., C.A. No. 8110-VCN (Del. Ch. Jan. 25, 2013). Issue Addressed Selection of lead counsel and lead plaintiff in connection with the consolidation of about 18 related cases involving a challenge to various transactions. Brief Overview Although the Court consolidated this multitude of cases pursuant to Court of … Continue Reading