Justia Delaware Court of Chancery Opinion Summaries

The Court of Chancery dismissed without prejudice Plaintiffs' complaint, holding that the action generally lacked an actual controversy and Plaintiffs sought what amounted to an advisory opinion and that the single portion of the dispute that appeared ripe failed to state a claim upon which relief could be granted.In their complaint, Plaintiffs disputed a company's interpretation of certain provisions in an LLC agreement, The first count was a breach of contract claim seeking a determination regarding the construction of the LLC agreement, and the other count was also styled as a breach of contract claim seeking a declaration that restrictive covenants in certain sections of the LLC agreement were overbroad and unenforceable under Delaware law. Defendant moved to dismiss the complaint under Court of Chancery Rules 12(b)(1) and 12(b)(6), arguing that no justiciable controversy existed. The Court of Chancery granted the motion, holding (1) the claim in count one was unripe, and the claim in count two did not present a justiciable dispute; and (2) the purchase notice claim in count one is dismissed without prejudice under Rule 12(b)(6). View "Klein v. ECG Topco Holding, LLC" on Justia Law

The Court of Chancery granted summary judgment in favor of Respondents and confirmed a May 10, 2021 arbitration award, holding that this court was obliged to grant Respondents' cross-motion for summary judgment to confirm the award.Respondent commenced an arbitration proceeding against Petitioner asserting several claims relating to amendments to the parties' LLC agreement. After the arbitrator issued decisions, Petitioner filed a petition to vacate the award in part. Respondent and affiliated entities filed a counterclaim to confirm the arbitration award. All parties moved for summary judgment. The Court of Chancery granted summary judgment in favor of Respondents and confirmed the arbitration award, holding that Petitioner's challenges to the award failed. View "Polychain Capital LP v. Pantera Venture Fund II LP" on Justia Law

In this dispute over whether homeowners may park a commercial van at and on their property in Bear, Delaware, the Court of Chancery held that the van was expressly permitted and that judgment should be entered in favor of the homeowners.Plaintiff was responsible for maintaining a private open space within a development. Property within the development was subject to restrictions set forth in a declaration of restrictions and an amendment to the declaration. Defendants were accused of violating a restriction on prohibited vehicles. Plaintiff filed the underlying complaint seeking a mandatory injunction to remove Defendants' van from the property. The Court of Chancery held that judgment should be entered in Defendants' favor because the van was expressly permitted under the amendment. View "Estates of Red Lion Maintenance Corp. v. Broome" on Justia Law

The Court of Chancery granted summary judgment in favor of the State of Delaware and against the City of Seaford in the State's action seeking injunctive relief prohibiting the enforcement of the City's ordinance entitled "Ordinance Relative to Abortion" and a declaratory judgment that the ordinance was invalid, holding that the ordinance was preempted by Delaware law.In 2021, the City enacted the ordinance, which mandates that all fetal remains resulting from an abortion or miscarriage be cremated or interred. In its lawsuit, the State argued that the ordinance conflicted with state law, making it invalid under the doctrine of preemption. The Court of Chancery granted relief, holding that the ordinance conflicted with Delaware's statutory scheme requiring an official record of death before human remains can be cremated or interred. View "State v. City of Seaford" on Justia Law

The Court of Chancery granted Plaintiff's motion for summary judgment seeking an order confirming the arbitration panel's award in this case and denied Defendants' motion for summary judgment seeking to vacate the award, holding that there was no basis to vacate the arbitration panel's award.Defendants initiated arbitration proceedings against Plaintiff to challenge the validity of unsuitability determination that Plaintiff issued to Defendants under the parties' agreement. The arbitration panel determined that the unsuitability determination was valid. This litigation followed. The Court of Chancery confirmed the arbitration award, holding that Defendants were not entitled to relief on their allegations of error. View "MHP Management, LLC v. DTR MHP Management, LLC" on Justia Law

Evans served as CEO and a director of Avande, a privately held Delaware corporation that provides medical claims management services to insurance companies and healthcare organizations. Following Evans’s termination, Avande performed an audit and discovered suspect transactions undertaken by Evans while he was serving as CEO. Avande filed suit, alleging breach of fiduciary duty based on alleged self-dealing transactions and improper expenditures and tortious interference, defamation, and conversion based on acts that Evans allegedly committed after his termination. Evans was found liable for about $65,000 in damages, plus interest. Evans demanded advancement for expenses incurred in connection with the action.The Delaware Chancery court entered judgment in favor of Avande. Avande established that there is no causal link between Evans’s status as a former officer of Avande and the tortious inference and defamation claims; those claims solely concerned Evans’s post-termination conduct. Avande demonstrated that Evans did not succeed but was found liable. View "Evans v. Avande, Inc." on Justia Law

The Court of Chancery denied Defendants' motion to dismiss this complaint for failure to state a claim upon which relief could be granted, holding that Plaintiff's claims were ripe and that the complaint stated claims for breach of contract, breach of fiduciary duty, and unjust enrichment.Plaintiff, a stockholder of a company, brought this lawsuit alleging that Defendants breached the terms of an equity compensation plan, that Defendants breached their fiduciary duties, and unjust enrichment. Defendants moved to dismiss the complaint in its entirety, arguing that none of Plaintiff's claims were ripe and that Plaintiff failed to state a claim. The Court of Chancery denied the motion to dismiss, holding that Defendants' attacks on the complaint were unavailing. View "Garfield v. Allen" on Justia Law

The Court of Chancery granted Defendants' motion to dismiss the amended complaint against them under Court of Chancery Rule 12(b)(2) for lack of personal jurisdiction, holding that this Court lacked personal jurisdiction.To establish personal jurisdiction, Plaintiffs relied on sections 3104(c)(1) and 3014(c)(3) of Delaware's Long-Arm Statute and the conspiracy theory of jurisdiction. The Court of Chancery dismissed the claims without prejudice, holding (1) both theories of jurisdiction required a forum-related act or omission; (2) Plaintiffs did not adequately allege a forum-related act or omission; and (3) Plaintiffs' interpretation of section 3014(c)(3) was unsupported by caselaw. View "SDF Funding LLC v. Fry" on Justia Law

The Court of Chancery granted Defendants' partial motion to dismiss Plaintiffs' amended complaint, holding that Plaintiffs did not satisfy the statutory definition of "creditor" as required to have standing to pursue their amended claims under the Delaware Uniform Fraudulent Transfer Act (DUFTA).Defendant Genworth Life Insurance Company (GLIC) wrote a line of long-term care (LTC) insurance policies. Plaintiffs, a putative class of GLIC LTC policyholders and GLIC insurance agents who sold LTC policies, alleged that fraudulent transfers jeopardized GLIC's ability to pay LTC claims to its policyholders and LTC commissions to its insurance agents. Plaintiffs later amended their complaint to add three new claims challenging the distribution of certain proceeds as intentional and constructive fraudulent transfers. The Court of Chancery granted Defendants' partial motion to dismiss, holding that Plaintiffs' new DUFTA claims failed because they were not "claims" under DUFTA. View "Burkhart v. Genworth Financial, Inc." on Justia Law

The Court of Chancery entered a final judgment awarding Plaintiffs relief in this business dispute, holding that Plaintiffs proved that James Harron breached a duty of loyalty he owed to certain companies.Harron and the brothers Blair and Matthew Nagel formed Metro Storage International, LLC, and Harron served as the president. During his tenure, Harron provided consulting services to another client and assisted that client by disclosing confidential information belonging to Metro International and its affiliates. Later, the Nagel brothers backed Harron's new venture by forming Metro Storage LATAM LLC (together with Metro International, the Companies). Harron subsequently left the Companies, taking confidential documents belonging to the Companies. Thereafter, the Nagel brothers caused the Companies and their affiliates to file this action against Harron. The Court of Chancery granted judgment in favor of Plaintiffs, holding that Plaintiffs proved that Harron breached confidentiality restrictions in the Companies' governing agreements and violated the Stored communications Act. View "Metro Storage International LLC v. Harron" on Justia Law