Albert Carroll at Morris James LLP

Chancery Appoints Amicus Curaie to Provide Independent Guidance Regarding Unopposed Petition to Revive Defunct Corporation for Use...

In re Forum Mobile, Inc., C.A. 2020-0346-JTL (Del. Ch. Mar. 18, 2021) - The Court of Chancery has the inherent authority to appoint an amicus curaie if the Court believes it would benefit from a more fulsome presentation...more

4/15/2021 / Board of Directors , Custodians , Delaware General Corporation Law , Securities and Exchange Commission (SEC)

Superior Court Applies “Law Most Favorable” Choice of Law Provision and Finds Investment Fund’s Settlement of a Fraudulent...

Sycamore Partners Management, L.P. v. Endurance American Insurance Company, C.A. No. N18C-09-211 AML CCLD (Del. Super. Feb. 26, 2021) - The bankruptcy estate of Nine West accused investment firm Sycamore Partners of...more

3/31/2021 / Breach of Duty , Choice-of-Law , Fiduciary Duty , Fraudulent Transfers , Investment Funds

Chancery Grants Inspection Demand Relying on a Short-Seller’s Report

Jacob v. Bloom Energy Corp., C.A. No. 2020-0023-JRS (Del. Ch. Feb. 25, 2021) - In a post-trial opinion in this books-and-records action pursuant to 8 Del. C. § 220, the Court of Chancery granted a stockholder’s demand to...more

3/31/2021 / Books & Records , Form 8-K , Securities and Exchange Commission (SEC) , Short Selling

Chancery Dismisses Derivative Breach of Contract Claim Against Directors for Alleged Violations of Certificate of Incorporation

Lacey v. Mota-Velasco, C.A. No. 2019-0312-SG (Del. Ch. Feb. 11, 2021) - A corporate charter represents a contractual agreement between the corporation and its stockholders. In Lacey, the Court of Chancery addressed...more

3/31/2021 / Board of Directors , Breach of Contract , Breach of Duty , Fiduciary Duty , Motion to Dismiss

Superior Court Addresses Scope of Privilege Waiver in Dispute Involving The American Bottling Company, Coke, and Bodyarmor

The American Bottling Co. v. BA Sports Nutrition, LLC et. al, C.A. No: N19C-03-048-AML CCLD (Del. Super. Feb. 11, 2021) - Delaware courts generally uphold the attorney-client privilege, including by recognizing waivers...more

3/4/2021 / Breach of Contract , Mergers , Privilege Waivers , Tortious Interference

Chancery Allows McDonald’s to Pursue Claims Against Ex-CEO, Finding Separation Agreement’s Integration Clause Does Not Bar Them

McDonald’s Corp. v. Easterbrook, C.A. 2020-0658-JRS (Del. Ch. Feb. 2, 2021) - Delaware has a strong public policy against fraud. Consequently, parties who seek to bar extra-contractual fraud claims must expressly provide...more

3/3/2021 / Breach of Duty , Fiduciary Duty , Fraud , Separation Agreement

Chancery Applies Forum Non Conveniens Analysis to Grant Partial Stay of Dispute Between LLCs and Former Manager

AG Resource Holdings, LLC v. Thomas Badford Terral, C.A. No. 2020-0850-JRS (Feb. 10, 2021) - In AG Resource, the Court of Chancery was tasked with determining whether it or a Louisiana state court should resolve similar...more

3/3/2021 / Breach of Contract , Employment Contract , Forum Non Conveniens , Jurisdiction , LLC Agreements , Non-Compete Agreements

Chancery Applies Unclean Hands Doctrine to Prevent a Trustee from Rescinding the Decanting of a Trust

In the Matter of: The Niki and Darren Irrevocable Trust and the N and D Delaware Irrevocable Trust, C.A. No. 2019-0302-SG (Del. Ch. Feb. 4, 2021) - Delaware’s decanting statute allows a trustee to “decant” a trust by...more

3/2/2021 / Decanting , Irrevocable Trusts , Trustees , Trusts

Chancery Sustains Claims Against Target’s CEO, Target’s Financial Advisor, and Acquirer for Allegedly Covertly Steering Merger...

Firefighters’ Pension System of The City of Kansas City, Missouri Trust v. Presidio, Inc., C.A. No. 2019-0839-JTL (Del. Ch. Jan. 29, 2021) Presidio illustrates potential pitfalls for parties in the M&A process, including...more

2/26/2021 / Board of Directors , Breach of Duty , Business Judgment Rule , Controlling Stockholders , Duty of Loyalty , Fiduciary Duty

Chancery Construes Notice Provisions Associated With Escrowed Funds Under an Asset Purchase Agreement

Schillinger Genetics, Inc. v. Benson Hill Seeds, Inc., C.A. No. 2020-0260-MTZ (Del. Ch. Feb. 1, 2021) - Delaware courts will apply the plain terms of an unambiguous asset purchase agreement (“APA”), including its...more

2/25/2021 / Asset Purchase Agreements , Breach of Contract , Indemnification

Delaware Supreme Court Concludes Out-of-Pocket Damages Are the Default Remedy for Fraudulent Misrepresentation Absent an...

LCT Capital, LLC v. NGL Energy Partners, LLP, App. Nos. 565,2019 & 568,2019 (Del. Jan. 28, 2021) - Delaware law recognizes both benefit-of-the-bargain damages and out-of-pocket damages as remedies for fraudulent...more

2/25/2021 / Breach of Contract , Damages , Fraud , Misrepresentation , Motion for Judgment

Superior Court Applies Affiliate Privilege Doctrine To Dismiss Tortious Interference Claim Against Controller, While Sustaining...

Surf’s Up Legacy Partners, LLC v. Virgin Fest, LLC, C.A. No. N19C-11-092 PRW CCLD (Del. Super. Jan. 13, 2021) - In adjudicating a dispute over a scuttled deal in the music festival industry, the Delaware Superior Court...more

2/25/2021 / Breach of Contract , Fraud , Limited Liability Company (LLC) , Motion to Dismiss

Delaware Corporate and Commercial Case Law Year in Review: 2020

This top ten list summarizes significant decisions of the Delaware Supreme Court and the Delaware Court of Chancery over the past calendar year. Our criteria for selection are that the decision either meaningfully changed...more

2/19/2021 / Board of Directors , Books & Records , Business Judgment Rule , Delaware General Corporation Law , Fiduciary Duty , Mergers , Section 220 Request , Shareholders

Chancery Finds That Delaware’s Trade Secrets Statute Preempts Unjust Enrichment Claim for Same Alleged Misconduct

250ok, Inc. v. Message Sys., Inc., C.A. No. 2020-0588-JRS (Del. Ch. Jan. 22, 2021) - This decision clarifies the scope of preemption of common law claims under the Delaware Uniform Trade Secret Act (“DUTSA”). Plaintiff...more

2/9/2021 / Breach of Contract , Misappropriation , Preemption , Trade Secrets , Unjust Enrichment

Chancery Orders Production of Privileged Emails Transmitted Using Third-Party Accounts

In re WeWork Litigation, Consol. C.A. No. 2020-0258-AGB (Del. Ch. Dec. 22, 2020) - This Court of Chancery discovery ruling illustrates the risks associated with directors and officers using non-company email accounts to...more

2/9/2021 / Discovery , Electronic Communications , Electronically Stored Information , Email , Privileged Communication

Plaintiff’s Failure to Plead Demand Futility Leads to Dismissal of Caremark Claims Against MoneyGram Directors

Richardson v. Clark, C.A. No. 2019-1015-SG (Del. Ch. Dec. 31, 2020) - Under Court of Chancery Rule 23.1, a derivative plaintiff’s must make a demand on the corporation’s board of directors unless the plaintiff can plead...more

2/9/2021 / Breach of Duty , Caremark claim , Demand Futility , Dismissals , Fiduciary Duty

Chancery Modifies Confidentiality Order to Permit Assertion of Plenary Claims in Appraisal Action

Harris v. Harris FRC Corp., C.A. No. 2019-0736-JTL (Del. Ch. Jan. 7, 2021) - Under Rule 5.1, the Court of Chancery may enter a confidentiality order upon a showing of good cause that such an order is necessary to protect...more

2/9/2021 / Appraisal , Books & Records , Breach of Duty , Confidentiality Agreements , Fiduciary Duty , Section 220 Request

Chancery Addresses Authority of Executives to Remove Managers of Affiliate Entities

Roccia v. Mugica, C.A. No. 2020-0641-MTZ (Del. Ch. Dec. 29, 2020) - The inherent authority of officers of Delaware companies generally extends to powers in the usual and ordinary course of the relevant company’s business....more

2/8/2021 / Board of Directors , Contract Interpretation , Motion for Summary Judgment , Operating Agreements

Chancery Addresses Standing Defense And Control Allegations In Abandoned Tender Offer Dispute

In re WeWork Litig., C.A. No. 2020-0258-AGB (Del. Ch. Dec. 14, 2020) - This decision is the companion to another dismissal opinion in same case of the same date and arising out of the same abandoned multi-step tender...more

2/8/2021 / Breach of Contract , Breach of Duty , Controlling Stockholders , Fiduciary Duty

Chancery Resolves Dispute Between Competing Special Committees, Finding Second Committee Could Not Voluntarily Dismiss Suit...

In re WeWork Litigation, C.A. No. 2020-0258-AGB (Del. Ch. Dec. 14, 2020) - This decision addresses a matter of first impression arising out of a dispute pitting two special committees of the same company, WeCompany...more

2/8/2021 / Board of Directors , Breach of Contract , Breach of Duty , Fiduciary Duty , Motion to Dismiss

Superior Court CCLD Awards Sanctions For Unprepared Rule 30(b)(6) Deponent

Fortis Advisors, LLC v. Dematic Corp., C.A. No. N18C-12-104 AML [CCLD] (Del. Super. Nov. 18, 2020) - As this decision illustrates, Delaware trial courts have a variety of sanction options available when it comes to...more

1/22/2021 / Breach of Contract , Depositions , Discovery , FRCP 30(b)(6) , Merger Agreements

Chancery Dismisses First-Filed Action Involving Delaware Choice of Law and Forum Selection Clause for Forum Non Conveniens

Focus Fin. Partners, LLC v. Holsopple, C.A. No. 2020-0188-JTL (Del. Ch. Nov. 2, 2020) - Defendant moved on forum non conveniens grounds to dismiss an action brought by a recent hire’s former employer to enforce various...more

1/22/2021 / Forum Non Conveniens , FRCP 12(b)(3) , Jurisdiction , Motion to Dismiss , Personal Jurisdiction

Albert Carroll

Morris James LLP

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