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Delaware Superior Court Applies Law-of-the-Case Doctrine and Collateral Estoppel to a Prior Chancery Proceeding

Preston Hollow Capital LLC v. Nuveen LLC, C.A. No. N19C-10-107-MMJ [CCLD] (Del. Super. Dec. 15, 2020) - Plaintiff and defendants competed as institutional investors in the high-yield municipal bond market. Seeking to...more

Delaware Supreme Court Finds that Court of Chancery Had Jurisdiction To Enjoin a Collateral Attack on a Prior Arbitration Award...

Gulf LNG Energy, LLC v. ENI USA Gas Mktg., LLC, No. 22, 2020 (Del. Nov. 17, 2020) - This decision confirms that the Court of Chancery has jurisdiction to enjoin a collateral attack on a prior arbitration award. The...more

Chancery Sustains CEO’s Contract Claims in WeWork Litigation

In re WeWork Litig., Consol. C.A. No. 2020-0258-AGB (Del. Ch. Oct. 30, 2020). A company facing a liquidity crisis (the shared working space company, WeWork), its outgoing CEO (Adam Nuemann), and two related SoftBank...more

Chancery Questions Utility of Aronson Test, Dismisses Derivative Suit of Facebook Stockholder for Failure To Allege Demand...

United Food and Comm. Workers Union v. Zuckerberg, C.A. No. 2018-0671-JTL (Del. Ch. Oct. 26, 2020) - In its recent decision in United Food and Comm. Workers Union v. Zuckerberg, the Court of Chancery discussed the legal...more

Chancery Finds Warrant Issuance Triggered Stockholder Preemption Rights

L-5 Healthcare Partners, LLC v. Alphatec Holdings, Inc., C.A. No. 2019-0412-KSJM (Del. Ch. Oct. 12, 2020) - Pursuant to a share purchase agreement, a plaintiff stockholder had preemption rights that entitled the...more

Chancery Addresses Contract and Fraud Claims Relating to M&A Post-Closing Price Adjustments

Roma Landmark Theaters, LLC v. Cohen Exhibition Co., LLC, C.A. No. 2019-0585-PAF (Del. Ch. Sept. 30, 2020) - In Roma Landmark Theaters, the parties’ purchase agreement contained a framework for post-closing price...more

Chancery Holds Statutory Rights to Inspect Books and Records of a Delaware Corporation are Subject to the Internal Affairs...

JUUL Labs, Inc. v. Grove, C.A. No. 2020-0005-JTL (Del. Ch. Aug. 13, 2020) - Stockholder inspection rights are a core matter of the governance of a corporation. This decision holds that, pursuant to the internal affairs...more

Chancery Determines Validity of LLC Ownership Following Fraud and Deceit in Cross-Border Control Dispute

Lynch v. Gonzalez, C.A. No. 2019-0356-MTZ (Del. Ch. July 31, 2020) - Disputes over control of a Delaware limited liability company can turn on rigorous fact-finding efforts by the Court of Chancery where issues of witness...more

Chancery Orders Trial to Determine Meaning of Ambiguous Post-Closing Covenants in a Stock Purchase Agreement

Schneider Nat’l Carriers, Inc. v. Kuntz, C.A. No. 2017-0711-PAF (Del. Ch. July 16, 2020) - If parties to a contract offer reasonable but conflicting interpretations of ambiguous contractual language, the Court of Chancery...more

Chancery Interprets Merger Agreement Termination Fee Provision But Denies Summary Judgment to Resolve Questions of Fact in...

The Williams Cos., Inc. v. Energy Transfer LP, C.A. No. 12168-VCG (Del. Ch. July 2, 2020) - The Court of Chancery will enforce a merger agreement’s plain and unambiguous terms, including parties’ agreed-upon conditions for...more

Chancery Interprets Contractual Language Permitting Asset Sale

AM Gen. Holdings LLC v. The Renco Grp., Inc., C.A. No. 7639-VCS (Del. Ch. June 26, 2020) - Under fundamental contract interpretation principles, the Court of Chancery will interpret a contract to give effect to specific...more

Court of Chancery Dismisses Aiding and Abetting Claim Against NetSuite’s Fiduciaries for Role in Alleged Overpayment by Oracle

In re Oracle Corp. Derivative Litig, Consol. C.A. No. 2017-0337-SG (Del. Ch. June 22, 2020) - At the pleadings stage, a claim for aiding and abetting a breach of fiduciary duty requires that it is reasonably conceivable...more

Court of Chancery Sustains Aiding-and-Abetting Breach of Fiduciary Duty Claim Against Financial Advisor Based on its Conflicts of...

Morrison v. Berry, C.A. No. 12808-VCG (Del. Ch. June 1, 2020) - Even if fiduciary duty of care claims against a target company’s board of directors are exculpated, an aiding-and-abetting claim against a financial advisor...more

Corporate Opportunity Doctrine Waiver Does Not By Itself Also Constitute a Waiver of Default Fiduciary Duties under an LLC...

77 Charters, Inc. v. Gould, C.A. No. 2019-0127-JRS (Del. Ch. May 18, 2020) - The Court of Chancery held that a waiver of the corporate opportunity doctrine did not by itself constitute a waiver of default fiduciary duties...more

Applying Rare Intermediate Review of Forum Non Conveniens, the Delaware Superior Court Stays a Delaware Action to Permit Filing of...

GXP Capital, LLC v. Argonaut Mfg. Servs., Inc., C.A. No. N18C-07-267 PRW CCLD (Del. Super. May 4, 2020) - When evaluating a forum non conveniens challenge, Delaware has a seldom used, intermediate framework of review....more

Delaware Superior Court Interprets Contractual Language Governing Earn-out Payment

B&C Holdings, Inc. v. Temperatsure Holdings, LLC, C.A. No. N19C-02-105 AML CCLD (Del. Super. Apr. 22, 2020). As this decision demonstrates, Delaware courts will enforce the plain and ordinary meaning of contractual terms...more

Court of Chancery Permits Targeted Jurisdictional Discovery to Seek Proof to Support Non-Frivolous Claim of Personal Jurisdiction

HM Life Ins. Co. v. Wilmington Sav. Fund Soc’y, FSB, C.A. No. 2018-0649-SG (Del. Ch. Apr. 9, 2020). If a plaintiff has pled facts in its complaint to support a non-frivolous claim of personal jurisdiction over a defendant,...more

Minority Members Allegedly Exploited Contract Rights in Breach of Fiduciary Duties to Acquire Company Assets on the Cheap

Delaware law requires directors of a corporation to strive in good faith and on an informed basis to maximize the value of the corporation for the benefit of all of its stockholders, and not to prefer the interests of...more

Chancery Shifts Attorneys’ Fees Under Bad-Faith Exception Based on False Statements in Plaintiff’s Complaint and Obstruction of...

Bay Capital Finance, L.L.C. v. Barnes and Noble Education, Inc., C.A. No. 2019-0539-KSJM (Del. Ch. Mar. 30, 2020). With some limited exceptions, the American Rule requires parties to pay their own attorneys’ fees in...more

Chancery Holds That Res Judicata Precludes Plaintiff’s Claim for Information Rights Under Merger Agreement

Fortis Advisors LLC v. Shire US Holdings, Inc., C.A. No. 2018-0933-JRS (Del. Ch. Feb. 13, 2020) - The doctrine of res judicata bars a plaintiff from splitting claims arising from a single transaction into multiple...more

Delaware Superior Court Distinguishes Between Affirmative and Negative Covenants in Earnout Dispute

Quarum v. Mitchell Int’l, Inc., C.A. No. N19C-03-087 AML CCLD (Del. Super. Jan. 21, 2020). Under Delaware law, parties may structure covenants in an earnout agreement as affirmative (mandating action) or negative...more

Uber Board Was Disinterested and Independent to Assess a Pre-Suit Demand for Acquisition of Google Program

Uber Technologies’ board approved the acquisition of Google’s more mature autonomous vehicle program. The transaction was high risk and flawed from its inception, ending in embarrassment after Uber learned that key employees...more

Delaware Superior Court CCLD Clarifies When a Plaintiff is on Inquiry Notice to Bring a Claim for Limitations Period Purposes

Ocimum Biosolutions (India) Ltd. v. AstraZeneca UK Ltd., C.A. No. N15C-08-168 AML CCLD (Del. Super. Dec. 10, 2019). Even in circumstances where a statutory limitations period can be tolled, tolling typically will cease...more

Chancery Provides Further Clarity Regarding Material Adverse Effect Clauses in Merger Agreements

Channel Medsystems, Inc. v. Boston Scientific Corp., C.A. No. 2018-0673-AGB (Del. Ch. Dec. 18, 2019). Material adverse effect clauses provide a form of buy-side protection in merger agreements. These often are complex...more

Venture Capital Firms Did Not Constitute a Control Group Barring Stockholder Direct Claims for Dilution

To avoid demand futility and standing requirements for a derivative claim, the plaintiff stockholders in Sheldon v. Pinto Technology Ventures, No. 81, 2019 (Del. Oct. 4, 2019) attempted to plead a direct claim for dilution of...more

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