Justia Delaware Court of Chancery Opinion Summaries

Maurice J. Moyer Academic Institute (“New Moyer”) is a charter school in the City of Wilmington that serves some of the most economically disadvantaged students in the state. In 2014, the Department of Education, Secretary of Education, and Delaware Board of Education (collectively, Defendants) decided to revoke New Moyer’s charter in June 2016, one year before the charter expired. Defendants based their decision on the fact that New Moyer was the lowest performing charter school in the State based on the State’s testing standards. Plaintiffs - the operator of New Moyer, parents representing several of the school’s students, and the City - sought a preliminary injunction to enjoin Defendants from revoking New Moyer’s charter. The Court of Chancery denied Plaintiffs’ motion for a preliminary injunction, concluding that Plaintiffs failed to demonstrate (1) a reasonable probability that they were denied due process under the Fourteenth Amendment with respect to the decision to revoke the school’s charter; and (2) that Defendants did not exercise due diligence and good faith when they determined that New Moyer failed to satisfy criteria set forth in the Charter School Act. View "In re The New Maurice J. Moyer Academy Inc." on Justia Law

Plaintiff served as the Chairman and CEO of Smashburger Master LLC until his termination in early 2014. Smashburger subsequently informed Plaintiff that it was redeeming Plaintiff’s units in the company. Plaintiff disagreed with Smashburger’s valuation of the units and demanded that Smashburger provide him with documents from specific categories of business and financial records. Smashburger refused Plaintiff’s request on the grounds that it had already redeemed all of Plaintiff’s units, thus terminating Plaintiff's status as a member of Smashburger and precluding him from properly demanding inspection. Plaintiff then filed a complaint against Smashburger. The Court of Chancery granted Smashburger’s motion to dismiss, concluding that Plaintiff was no longer a member of Smashburger when he demanded inspection, and Delaware law does not provide pertinent inspection rights to former LLC members. View "Prokupek v. Consumer Capital Partners LLC" on Justia Law

After David H. Murdock, the CEO and controlling stockholder of Dole Food Company, Inc., acquired all the shares of Dole common stock that he did not already own, Petitioners pursued their statutory right to an appraisal of their shares of Dole common stock. During discovery, Dole sought information about any valuations of Dole common stock that Petitioners prepared, reviewed, or considered when buying to selling Dole common stock or when seeking appraisal. Petitioners objected to the document requests. Dole subsequently served notices of deposition for each Petitioner pursuant to Court of Chancery Rule 30(b)(6) and identified the valuations as a topic of questioning. During the depositions, Petitioners’ counsel instructed the Rule 30(b)(6) witnesses not to testify about the valuations on the basis of relevance. Dole moved to compel production of the valuation-related information and for supplemental Rule 30(b)(6) depositions. The Court of Chancery granted the motion, holding that, under the circumstances, Petitioners’ failure to provide the discovery was not substantially justified. View "In re Appraisal of Dole Food Co., Inc." on Justia Law

After Plaintiff fell behind on her payments to Attorney in the underlying litigation, Attorney filed a motion to withdraw as counsel for Plaintiff and requested a charging lien in the amount of approximately $300,000. Plaintiff did not oppose Attorney’s withdrawal but did oppose the entry of a charging lien. The Court of Chancery found that a charging lien was appropriate and granted a charging lien in the amount of $200,000 against any judgment in this action, holding (1) a fee agreement between the parties did not preclude the entry of a charging lien; (2) the total amount of the charging lien that was appropriate in this case should not exceed Plaintiff’s lowest-possible net recovery of $263,872; and (3) Attorney was not liable to the experts for their fees, so there was no basis for include those fees in the charging lien. View "In re Zutrau v. Jansing & ICE Sys., Inc." on Justia Law

The underlying case involved a deadlock relating to the management of the business of TransPerfect Global, Inc. and its wholly owned subsidiaries. Here, Plaintiff filed a motion for the appointment of a interim custodian until a trial could be held to resolve, among other things, Plaintiff’s petition for the appointment of a custodian. The Court of Chancery denied the motion, as Plaintiff failed to establish that the appointment of a temporary custodian was urgently needed to serve during the interim between now and trial for the immediate protection of the corporation. View "In re TransPerfect Global, Inc." on Justia Law

This dispute centered around the question of whether there was mold that needed remediation in the common elements of a Condominium’s structure adjacent to the unit owned by Defendants. Plaintiff, the Council at the Condominium, arranged for a study by an industrial hygienist, who concluded that immediate attention was needed to address “the change in mold spore concentrations.” The Court of Chancery granted summary judgment in favor of the Council and ordered Defendants to cooperate with the Council in allowing it and its contractors access to Defendants’ unit for remediation of the mold, holding that Defendants failed to identify and present a dispute of fact about the appropriateness of the Council’s chosen pathway. View "Council of The Pointe at Bethany Bay Condos. v. Higgins" on Justia Law

In 1979, Mother and Daughter set up joint checking and savings accounts. In 2006, Daughter withdrew almost all of the funds from the joint savings account without first informing Mother. Mother and Daughter also jointly owned real estate. Mother filed an action against Daughter, alleging that Daughter improperly converted the funds held in the joint bank account and that Daughter's lack of cooperation and obstructive behavior regarding the property amounted to waste. The Court of Chancery entered judgment in favor of Daughter, holding (1) Mother failed to show that Daughter agreed that the joint account would be established for Mother’s benefit and family emergencies or that Mother was otherwise successful in modifying the joint tenancy provisions of the Bank’s account documentation; and (2) Daughter was not liable for waste. View "Mack v. Mack" on Justia Law

Plaintiff, Cigna Health and Life Insurance Co., challenged Optum Services, Inc’s acquisition by merger, via Audax Holdings, Inc., of Audax Health Solutions, Inc. Plaintiff moved for judgment on the pleadings, arguing that certain provisions of the merger agreement were contrary to the Delaware General Corporation Law. Those provisions related to a release of claims, an indemnification requirement, and the appointment of a stockholder representative. The Court of Chancery granted the motion in part and denied it in part, holding (1) the release of claims lacks any force because the buyer attempted to impose that obligation in a contract lacking consideration; (2) the indemnification provision violates 8 Del. Cas. 251; and (3) Plaintiff failed to brief the stockholder representative issue sufficiently to support its request for judgment as a matter of law. View "Cigna Health & Life Ins. Co. v. Audax Health Solutions, Inc." on Justia Law

Plaintiff and Defendant entered into a Settlement and License Agreement to resolve then-pending patent infringement litigation. After Plaintiff’s license was terminated, Plaintiff filed a complaint for declaratory, injunctive, and other relief against Defendant. Defendant moved to dismiss, arguing that the Court of Chancery was an improper venue because the Agreement’s forum selection clause directed “any dispute” between the parties to Georgia. Plaintiff argued that the Agreement was terminated before it filed the complaint, and regardless, its claims were not subject to the forum selection clause. The Court of Chancery dismissed the complaint without prejudice, holding that the courts identified in the forum selection clause were proper forums to determine whether the Agreement had been terminated, and if the Agreement was effective when Plaintiff filed the complaint, then dismissal for improper venue would be proper. View "Scanbuy, Inc. v. NeoMedia Techs., Inc." on Justia Law

Plaintiff, an inmate at the James T. Vaughn Correctional Center (JTVCC), filed this action against personnel at the JTVCC seeking an injunction and compensatory damages for placement in isolated confinement and, subsequently, maximum security housing. Defendants moved to dismiss Plaintiff’s claim and to revoke his in forma pauperis status pursuant to the three strikes rule of 10 Del. C. 8804(f). The Court of Chancery granted Defendants’ motion to revoke Plaintiff’s in forma pauperis status and ordered the complaint dismissed unless Plaintiff filed all required filing fees within sixty days, holding that Plaintiff failed to show that he met the statutory exception to the three strikes rule. View "Biggins v. Phelps" on Justia Law