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Chancery Addresses Indemnification Rights Following CEO’s Partial Success On Underlying Claims, Including Success Based on...

Evans v. Avande, Inc. , C. A. No. 2018-0454-LWW (Del. Ch. Sept. 23, 2021) - The departure of a company’s CEO was contentious. After his termination, the company filed an action in the Court of Chancery, alleging that the...more

CCLD Rejects Several Defenses to Insurance Coverage of a Settlement Paid By Investment Fund

Sycamore Partners Management, L.P. v. Endurance American Insurance Co., C.A. No. N18C-09-211 AML CCLD (Del. Super. Sept. 10, 2021) - Prior to the closing of a leveraged buyout of a company (the “Merger”) whereby the...more

Delaware Supreme Court Upholds Contractual Waiver of Statutory Appraisal Rights

Manti Holdings, LLC, et al. v. Authentix Acquisition Co., Inc., No. 354, 2020 (Del. Sept. 13, 2021) - This decision arose out of the acquisition of Authentix Acquisition Company, Inc. and a subsequent appraisal proceeding...more

Chancery Examines Cornerstone Standard for Establishing Non-Exculpated Fiduciary Duty Claims

In Re BGC Partners, Inc. Derivative Litigation, Consol. C.A. No. 2018-0722-LWW (Del. Ch. Sep. 20, 2021) - A director protected by an exculpatory provision is entitled to dismissal in a breach of fiduciary duty action...more

Chancery Rejects MFW Defense Based on Failure to Disclose That a Conflicted Controller Participated in Arbitration Proceedings...

Ligos v. Isramco, Inc., C.A. No. 2020-0435-SG (Del. Ch. Aug. 31, 2021) - Under MFW, a conflicted controller transaction may get the benefit of business judgment review when conditioned on two procedural protections...more

Chancery Declines to Order Production of Privileged Document

Drachman v. BioDelivery Sciences International, Inc., C.A. No. 2019-0728-LWW (Del. Ch. Aug. 25, 2021) - Drachman addresses the attorney-client privilege, certain exceptions thereto, including the Garner doctrine, and...more

Chancery Stays Advancement Action in Favor of Pending Related Federal Action

The Harmon 1999 Descendants’ Trust v. CGH Investment Management, LLC, C.A. No. 2021-0407-KSJM (Sept. 21, 2021) - Generally, absent unusual circumstances, claims for advancement will not be stayed or dismissed in favor of...more

Chancery Rejects Inadequate Disclosure Contentions and Grants Corwin Dismissal

Kihm v. Mott, C.A. No. 2020-0938-MTZ (Del. Ch. Aug. 31, 2021) - Under the Corwin doctrine, a fully informed and uncoerced approval of a board decision by the corporation’s disinterested stockholders can downgrade an...more

Chancery Declines to Dismiss Narrow Claims Relating to Entity’s Dissolution In Favor of Pending Related Action

Hawkins v. Daniel, C.A. No. 2021-0453-JTL (Del. Ch. Aug. 24, 2021) - The Delaware courts utilize several doctrines to address motions to dismiss or stay in favor of related litigation, including McWane and Cryo-Maid, all...more

Chancery Addresses Viability of Contractual Fraud Claims Allegedly Barred by Agreement’s Terms

Online Healthnow, Inc. v. CIP OCL Investments, LLC, C.A. No. 2020-0654-JRS (Del. Ch. Aug. 12, 2021) - Online Healthnow concerns “contractual fraud claims,” meaning a statement made in the agreement itself that is known to...more

Chancery Explains Standards of Review for Receiver Determinations and Shifts Fees and Expenses in Dissolution

In re Dissolution of Jeffco Management, LLC, C.A. No. 2018-0027-PAF (Del. Ch. Aug. 16, 2021) - When the Court of Chancery appoints a receiver to effectuate a company’s dissolution, certain determinations are subject to de...more

Chancery Addresses Common Interest and Privilege Log Issues in Matter Involving Special Discovery Matter

Buttonwood Tree Value Partner, L.P. v. R.L. Polk & Co., Inc., et al., C.A. No. 9250-VCG (Del Ch. Jul. 30, 2021) - With increasing frequency, the Court of Chancery is appointing Special Discovery Masters and Discovery...more

Chancery Finds LLC Managers Liable for Self-Dealing Scheme Depleting Nearly All Investment Capital

Stone & Paper Investors, LLC v. Blanch, C.A. No. 2018-0394-PAF (Del. Ch. July 30, 2021) - This post-trial opinion involves a particularly egregious set of facts. Two LLC managers were accused of breaching their contractual...more

Chancery Addresses Whether LLC Agreement Modified or Eliminated Fiduciary Duties

In Re Cadira Group Holdings, LLC Litigation, Consolidated C.A. No. 2018-0616-JRS (Del. Ch. July 12, 2021) - The Delaware Limited Liability Company Act provides that “the fiduciary duties of a member, manager, or other...more

Chancery Finds That the Standard of Review for the Conduct of a Shareholders’ Representative Turns Upon the Merger Agreement’s...

Houseman v. Sagerman, C.A. No. 8897-VCG (Del. Ch. July 20, 2021) - A merger agreement between a subsidiary of Healthport Technologies, LLC and Universata, Inc., gave the owners of 72 percent of Universata’s stock (the...more

Chancery Finds Change in Product’s Medicare Reimbursement Rate Was Not A Material Adverse Effect Excusing Buyer From Closing

Bardy Diagnostics, Inc. v. Hill-Rom, Inc. C.A. No. 2021-0175-JRS (Del. Ch. Jul. 9, 2021) - Bardy manufactures a patch that measures heart rate. Its reimbursement rate for the patch had for years been set around $365 per...more

Chancery Upholds Well-Pled Claims Relating to Former Fiduciaries’ Retention of Derivative Arbitration Award

Optimiscorp v. Atkins, C.A. No. 2020-0183-MTZ (Del. Ch. July 15, 2021) - In Optimiscorp, the Court upheld claims against former directors and officers of plaintiff Optimiscorp arising out of the defendants’ failure to turn...more

Chancery Addresses Claims Arising Out of LLC Dispute Involving Parallel Venture

Largo Legacy Group, LLC v. Evens Charles, C.A. No. 2020-0105-MTZ (Del. Ch. June 30, 2021) - In this LLC dispute, an investor in a hotel development company alleged that the company principals breached the operating...more

Clean-Up Doctrine to Adjudicate Legal Claims in Chancery May Take Precedence Over Request for Jury Trial

Firststring Research, Inc. v. JSS Medical Research Inc., C.A. No. 2020-0332-KSJM (Del. Ch. May 28, 2021) - Delaware has not merged its courts of law and equity, which may have implications for a litigant seeking a jury...more

Delaware Supreme Court Explains Delaware’s Intermediate Forum Non Conveniens Standard Under Gramercy

GXP Capital, LLC v. Argonaut Manufacturing Services, Inc. et al., Nos. 247, 2020 and 248, 2020 (Del. May, 20, 2021) - Delaware has three standards for forum non conveniens motions. The two more commonly addressed are...more

Chancery Upholds Fiduciary Duty Claims Arising Out Of Deal Involving an Alleged Control Group That Included Non-Stockholders and a...

In re Pattern Energy Grp. Inc. Stockholders Litig., C.A. No. 2020-0357-MTZ (Del. Ch. May 6, 2021) - This decision mostly denying a motion to dismiss examines several important issues in post-closing M&A fiduciary duty...more

Implied Covenant of Good Faith and Fair Dealing Saves Employee’s Claim for Improper Termination Under Company’s LLC Agreement

Smith v. Scott, C.A. No. 2020-0263-JRS (Del. Ch. Apr. 23, 2021) - The Delaware LLC Act provides that fiduciary duties may be expanded or limited by the provisions of an LLC agreement. If the agreement is silent, then...more

Chancery Denies Claim Arising Out of Controller’s Announced Intention to Oppose a Transaction Unfavorable to His Interests

RCS Creditor Trust v. Schorsch et al., C.A. No: 2017-0178-SG (Del. Ch. Mar. 18, 2021) - Controlling shareholders of a Delaware corporation owe fiduciaries duties, but those duties do not require controllers to sacrifice...more

Chancery Enjoins Prosecution of Fraudulent Inducement and Declaratory Judgment Claims Based on Exclusive Delaware Forum Provision

SPay, Inc. v. Stack Media Inc. k/n/a JLC2011, Inc., et al., CA No. 2020-0540-JRS (Del. Ch. Mar. 23, 2021) - To obtain a preliminary anti-suit injunction, a movant must show (1) a reasonable likelihood of success on the...more

Chancery Finds Implied-in-Fact LLC Agreement

Robinson v. Darbeau, C.A. No: 2019-0853-KSJM (Del. Ch. Mar. 1, 2021) - As Robinson v. Darbeau demonstrates, Delaware law recognizes implied limited liability company agreements. Plaintiff operated a daycare as a sole...more

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