Tyler O'Connell at Morris James LLP

Court of Chancery Applies the American Rule and Denies Attorneys’ Fees Despite Fiduciary Breach

In re Straight Path Commc’ns Inc. Consol. S’holder Litig., C.A. No. 2017-0486-SG (Del. Ch. Oct. 29, 2024) - The Court of Chancery in this stockholder class action refused to award attorneys’ fees where the Court found the...more

4/25/2025 / Breach of Duty , Business Litigation , Controlling Stockholders , Corporate Governance , Damages , Delaware , Fiduciary Duty , Mergers , Shareholder Litigation

Chancery Holds Defendant Breached Fiduciary Duties by Failing to Distribute Assets Equally During Dissolution of LLC

Mehra v. Teller, C.A. No. 2019-0812-KSJM (Del. Ch. Sept. 20, 2024) - In this post-trial decision, the plaintiffs claimed that one of the defendants breached his fiduciary duties by failing to distribute assets equally at...more

4/2/2025 / Breach of Duty , Business Disputes , Business Entities , Business Litigation , Damages , Delaware , Dissolution , Fiduciary Duty , Limited Liability Company (LLC) , Shareholder Litigation

Court of Chancery Finds in Favor of Defendants on All Remaining Claims After Remand

Bandera Master Fund LP v. Boardwalk Pipeline Partners, LP, C.A. No. 2018-0372-JTL (Sept. 9, 2024) - Previously in this case, the Court of Chancery held that a general partner breached a partnership agreement by exercising...more

3/21/2025 / Appeals , Breach of Contract , Business Litigation , Corporate Governance , DE Supreme Court , Disclosure Requirements , Fiduciary Duty , Limited Partnership Agreements

Delaware General Corporation Law: Proposed Amendments to Sections 144 and 220

On February 17, 2025, Delaware legislators introduced proposed Senate Bill 21, providing for amendments to Sections 144 and 220 of the Delaware General Corporation Law (DGCL)....more

3/19/2025 / Board of Directors , Corporate Governance , Delaware General Corporation Law , Disclosure Requirements , Fiduciary Duty , Safe Harbors , Shareholder Litigation , Shareholders

Chancery Removes an Assignee for Cause in an Assignment for the Benefit of Creditors Proceeding

In re: Wack Jills, Inc., C.A. No. 2019-0650-PAF (Del. Ch. Aug. 29, 2024) - In this proceeding for the assignment for the benefit of creditors (“ABC proceeding”), the company assigned all of its property and assets to...more

2/27/2025 / Bankruptcy Code , Bankruptcy Court , Corporate Governance , Corporate Restructuring , Creditors , Debtors , Delaware , Enforcement Actions , Reporting Requirements

Chancery Says Litigation Privilege No Shield Against LLC Interest Repurchase

Seva Holdings Inc. v. Octo Platform Equity Holdings, LLC, C.A. No. 2022-0437-PWR (Del. Ch. Aug. 29, 2024) - In deciding limited cross motions for summary judgment, the Court of Chancery held that the absolute litigation...more

2/26/2025 / Breach of Contract , Business Litigation , Contract Disputes , Contract Terms , Corporate Governance , Delaware , Dispute Resolution , Limited Liability Company (LLC) , Shareholders , Summary Judgment

Chancery Finds that the Plaintiff Successfully Pled Breach of Contract for Milestone Payments

Medal v. Beckett Collectibles, LLC, C.A. No. 2023-0984-VLM (Del. Ch. Aug. 22, 2024). In denying a motion to dismiss, the Court of Chancery held that the plaintiff pled reasonably conceivable claims for breach of...more

2/19/2025 / Breach of Contract , Business Litigation , Contract Terms , Corporate Governance , Delaware , Motion to Dismiss , Shareholder Litigation , Shareholders

Court of Chancery Finds Class Counsel’s Litigation Funding Agreement is Discoverable

Burkhart v. Genworth Fin., Inc., C.A. No. 2018-0691-NAC (Del. Ch. Aug. 21, 2024). The rise in litigation funding brings a predictable follow-on question: Are litigation funding agreements protected as work product, or...more

2/7/2025 / Class Action , Class Members , Consumer Litigation , Contract Terms , Disclosure Requirements , Discovery , Insurance Industry , Litigation Funding

Chancery Holds Void Corporations are Unable to Litigate Claims

Rivera v. Angkor Capital Ltd., C.A. 2022-0671-MTZ (Del. Ch. Aug. 20, 2024) - In this decision involving a plaintiff corporation’s action to rescind a stock purchase agreement involving the sale of a majority interest in...more

2/6/2025 / Business Entities , Business Litigation , Corporate Dissolution , Corporate Taxes , Delaware General Corporation Law , Shareholders , Stock Purchase Agreement

Failure to Maintain Legal Hold Leads to Spoliation, Sanctions, and Fee Shifting in Delaware Superior Court CCLD

Huntsman Int'l, LLC v. Benelux, C.A. No. N17C-11-242 MAA CCLD (Del. Super. Ct. Aug. 13, 2024). In the age of big data, discovery can extend beyond traditional documents and communications to myriad tools and databases....more

2/6/2025 / Complex Litigation , Data Management , Data Preservation , Discovery , Electronically Stored Information , Fee-Shifting , Legal Technology , Litigation Strategies , Sanctions , Spoliation

Chancery Enforces Parties’ Agreement to Specific Enforcement for Breach of Preemptive Rights Provision

L-5 Healthcare Partners, LLC v. Alphatec Holdings, Inc., C.A. No. 2019-0412-NAC (Del. Ch. Aug. 21, 2024) - In this post-trial decision, the Court found specific performance was the appropriate remedy for a breach of a...more

2/6/2025 / Breach of Contract , Contract Terms , Corporate Governance , Securities Litigation , Securities Regulation , Shareholders

Chancery Finds that Former Employees were “Officers” Entitled to Advancement

Gilbert v. Unisys Corp., C.A. No. 2023-0513-PAF (Del. Ch. Aug. 13, 2024) - In this decision, the Court of Chancery held that the plaintiffs were entitled to advancement of legal fees and expenses from their former...more

1/22/2025 / Advancement , Board of Directors , Corporate Governance , Corporate Officers , Delaware General Corporation Law , Employment Litigation , Fiduciary Duty

Chancery Decision Provides Instructive Guidance on Referencing Private Agreements in Corporate Charters and Bylaws

Seavitt v. N-able, Inc., C.A. No. 2023-0326-JTL (Del. Ch. July 25, 2024) - Earlier this year, the Court of Chancery in West Palm Beach Firefighters’ Pension Fund v. Moelis (“Moelis”) invalidated a stockholders’ agreement...more

1/2/2025 / Board of Directors , Corporate Governance , Fiduciary Duty , Shareholders

Chancery Finds that Would-Be Caremark Plaintiffs Failed to Plead Demand Futility

Bricklayers Pension Fund of W. Pa. v. Brinkley, C.A. No. 2022-1118-MTZ (Del. Ch. July 12, 2024) - In derivative cases where a stockholder-plaintiff has not made a pre-suit demand on the board of directors, demand futility...more

12/19/2024 / Board of Directors , Breach of Duty , Demand Futility , Derivative Suit , Fiduciary Duty , Shareholder Litigation , Shareholders

Chancery Holds That Demand Was Not Wrongfully Refused When Considered by Working Group

In re Kraft Heinz Demand Refused Derivative Stockholder Litig., Consol. C.A. No. 2022-0398-LWW (Del. Ch. July 19, 2024) - By making a demand, a stockholder-plaintiff tacitly concedes that the board can impartially consider...more

12/19/2024 / Board of Directors , Breach of Duty , Demand Futility , Derivative Suit , Fiduciary Duty , Shareholder Litigation , Shareholders

Chancery Defaulted to Deal Price to Determine the Fair Value of a Privately-Held Corporation in an Appraisal Proceeding

Hyde Park Venture Partners Fund III, L.P. v. FairXchange, LLC, C.A. No. 2022-0344-JTL (Del. Ch. July 30, 2024) - In this post-trial appraisal decision, the Court of Chancery determined the fair value of a privately-held...more

12/19/2024 / Appraisal , Board of Directors , Corporate Governance , Merger Agreements , Mergers , Shareholders

Chancery Orders Dissolution of Single Asset LLC

Gibson v. Konick, C.A. No. 2022-1036-LWW (Del. Ch. July 10, 2024) - The Court of Chancery dissolved a single asset LLC even though the LLC agreement required a unanimous vote of the members to dissolve, and one of the two...more

12/13/2024 / Corporate Dissolution , Limited Liability Company (LLC) , LLC Agreements , Spouses

Superior Court CCLD Holds that Lack of Agency Relationship Between Founders and Seller Prevents Imputation of Fraud to Seller

Pinnacle IV, L.P. v. Cyberlabs AI Holdings Ltd., C.A. No. N23C-04-021 MAA CCLD (Del. Super. July 11, 2024) - Who can be held liable for a fraudulent statement is often a key issue in fraud claims. In this decision from...more

12/10/2024 / Breach of Contract , Buyers , Counterclaims , Fraud , Fraudulent Inducement , Promissory Notes , Sellers

Chancery Holds that Related Individual and Class Claims Will Not Proceed Together and Litigants Cannot Pursue Class or Derivative...

Pope v. Hycroft Mining Holding Corp., C.A. No. 2022-0957-LWW (Del. Ch. July 9, 2024) - In this decision, the Court of Chancery found the plaintiffs could not press class claims if they also pursue related individual...more

12/10/2024 / Breach of Contract , Breach of Duty , Class Action , Derivative Suit , Fiduciary Duty

Chancery Enforces LLC Agreement in Prince Estate Dispute

McMillan v. Nelson, C.A. 2024-0016-KSJM (Del. Ch. July 5, 2024) - In a dispute over the management of Prince Legacy, LLC, an entity formed to manage assets from the estate of the late musician Prince, the Court of...more

12/10/2024 / Breach of Contract , Covenant of Good Faith and Fair Dealing , Implied Covenants , Limited Liability Company (LLC) , LLC Agreements

Court of Chancery Holds Non-Voting Stock Must be Included on Stock Ledger

Mitchell Partners, L.P. v. AMFI Corp., C.A. Nos. 2020-0985-KSJM, 2020-0986-KSJM (Del. Ch. July 3, 2024) - In this case, in which the Chancellor reviewed a decision by a special master, the Court examined whether...more

11/19/2024 / Breach of Duty , Fiduciary Duty , Shareholder Votes , Shareholders , Summary Judgment

Chancery Finds That Advancement Plaintiff was Employed by a Subsidiary and Entitled to Advancement

Centrella v. Avantor, Inc., C.A. No. 2022-0876-NAC (Del. Ch. July 1, 2024) - It is common for Delaware corporations to provide advancement rights to their officers and directors. In this post-trial decision from the Court...more

11/14/2024 / Board of Directors , Breach of Contract , Bylaws , Contract Terms , Mergers

Chancery Requires Bond in Connection With Status Quo Order

Leon v. Orlando, C.A. No. 2024-0311-LWW (Del. Ch. June 5, 2024) - In an action to determine the rightful manager of a Delaware limited liability company (“the Company”), the Court of Chancery required plaintiff to post a...more

10/31/2024 / Limited Liability Company (LLC) , Share Transfer , Shareholders , Stock Prices

Chancery Breaks With Two Earlier Decisions, Finds That an Integration Clause Does Not Bar Fraud Claims Based on Expressions of...

Trifecta Multimedia Holdings Inc. v. WCG Clinical Services, C.A. No. 2023-0699-JTL (Del. Ch. June 10, 2024) - Sophisticated parties frequently include “anti-reliance” clauses in their transaction agreements, whereby one...more

10/31/2024 / Breach of Contract , Fraud , Implied Covenants , Misrepresentation , Motion to Dismiss

Court of Chancery Rejects ‘Caremark’ Liability for Imperfect Compliance With Legal Obligations

Delaware corporations are not permitted to pursue profits by violating the law. Under Caremark and its progeny, directors’ fiduciary duties include the good faith obligation to oversee and monitor the corporation’s compliance...more

10/23/2024 / Board of Directors , Breach of Duty , Demand Futility , Derivative Suit , Fiduciary Duty , Shareholder Litigation , Shareholders

Tyler O'Connell

Morris James LLP

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