A recent Delaware Court of Chancery decision interpreted an indemnification clause and rejected the applicability of equitable defenses to a strictly legal claim. I highlighted the recent decision in NASDI Holdings v. North American Leasing, Inc., C.A. No. 2017-0399-KSJM (Del. Ch. Apr. 8, 2019), in an article published in the current issue of the
Indemnification
Indemnification Claim Not Ripe Until Final Adjudication
By Francis Pileggi on
Posted in Court of Chancery Updates
A recent decision by the Complex Commercial Litigation Division of the Delaware Superior Court in Winshall, et al. v. Viacom International, Inc., C.A. No. N15C-06-137 EMD CCLD (Del. Super., Feb. 25, 2019), ruled that a claim for indemnification was not ripe until a final adjudication, after appeal, was decided. In a matter involving a…
Indemnification Claim Accrues When Demand for Indemnification is Rejected
By Francis Pileggi on
Posted in Other Court Decisions
A recent Delaware decision is noteworthy because of its clarification of when the statute of limitations begins to run in connection with the alleged breach of a contractual indemnification clause.
The Superior Court ruled that an indemnification claim for environmental remediation liability accrued when the seller refused to indemnify the buyer–and not when the buyer…
Court Rejects Indemnification Cap on Fraud Claims
By Francis Pileggi on
Posted in Court of Chancery Updates
A common theme in cases before the Delaware Court of Chancery involves a buyer and a seller of a business disagreeing about some aspect of the deal. So it was in the matter of Great Hill Equity Partners IV, L.P. v. SIG Growth Equity Fund I, LLLP, C.A. No. 7906-VCG (Del. Ch. Dec. 3, 2018).…
Chancery Issues Additional Advancement and Indemnification Rulings in Quiznos Restructuring
By Francis Pileggi on
Posted in Court of Chancery Updates
An Eckert Seamans associate prepared this overview.
The Court of Chancery issued two opinions relating to a web of advancement and indemnification claims brought on behalf of multiple, separate plaintiffs: (1) Meyers v. Quiz-Dia LLC, C.A. No. 9878-VCL (Del. Ch. Jan. 9, 2017); and (2) Meyers v. Quiz-Dia LLC, C.A. No. 9878-VCL…
Chancery Grants Stay and Refers Indemnification Claims to Arbitrator to Determine Arbitrator’s Jurisdiction
By Francis Pileggi on
Posted in Court of Chancery Updates
An Eckert Seamans associate prepared this overview.
In Meyers v. Quiz-Dia LLC, C.A. No. 9878-VCL (Dec. 2, 2016), the Chancery Court stayed indemnification claims to determine whether they were arbitrable.
Background: This matter involves the perenial issue of arbitrability. Plaintiffs sued three Quiznos sandwich shop entities for indemnification and advancement pursuant to multiple agreements. …
Indemnification Rights Not Stymied by Amendment to Operating Agreement
By Aimee Czachorowski on
Posted in Court of Chancery Updates
The case of Branin v. Stein Roe Investment Counsel, LLC, 2014 WL 2961084 (Del. Ch. June 30, 2014) raised the interesting question of whether the operating agreement in effect at the time the suit was filed or the operating agreement in effect at the time the indemnification claim was made will control the right…
Chancery Denies Claim For Advancement and Indemnification From Successor Entity
By Francis Pileggi on
Posted in Court of Chancery Updates
Grace v. Ashbridge LLC, C.A. No. 8348-VCN (Del. Ch. Dec. 31, 2013).
Issue Addressed: Whether a successor entity was liable for advancement and indemnification claims based on the operating agreement of a successor entity LLC even though the sole allegations involve a predecessor entity and a related entity. Short Answer: No.
Brief Overview…
Chancery Clarifies Requirement for Statutory Indemnification
By Francis Pileggi on
Posted in Court of Chancery Updates
Costantini v. Swiss Farm Stores Acquisition LLC, C.A. No. 8613-VCG (Del. Ch. Dec. 5, 2013).
Issue Addressed
Whether the agency relationship between the company and a person seeking indemnification rights was sufficient for purposes of the standard applicable for statutory indemnification.
Short Answer: At the preliminary stage of a motion for judgment on…
Chancery Clarifies Scope of Indemnification in LLC
By Francis Pileggi on
Posted in Court of Chancery Updates
Costantini v. Swiss Farm Stores Acquisition LLC, C.A. No. 8613-VCG (Del. Ch. Sept. 5, 2013). A subsequent decision in this case was highlighted on these pages here.
Issue Presented: Whether a non-manager of an LLC was entitled to indemnification based on the terms of the LLC agreement.
Short Answer: Not based on…