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Complex Commercial Litigation Update

January 24, 2018

The last quarter of 2017 found the Delaware Superior Court’s Complex Commercial Litigation Division issuing a number of significant decisions in cases arising out of mergers and acquisitions and asset purchase agreements. Several decisions considered issues under post-closing indemnification provisions, and another decision highlights the importance of carefully drafting an anti-reliance provision in transactional documents. As noted in prior editions of this mailing, the CCLD has become a popular forum for disputes involving merger transactions—particularly when such transactions are alleged to have been induced or facilitated by fraud. If you have any questions regarding these decisions or the CCLD, please contact us or visit our website.

Judge Davis Finds Anti-Reliance Provision Insufficient to Bar Fraud Claims
In Novipax Holdings LLC, et al. v. Sealed Air Corp., et al., C.A. No. N17C-03-1682 EMD, Judge Davis denied a motion to dismiss a complaint filed by plaintiffs Novipax Holdings LLC and Novipax LLC (collectively, “Novipax”) against defendants Sealed Air Corporation, Cryovac, Inc., Sealed Air Corporation (US), and Sealed Air Corporation (Canada) (collectively, “Sealed Air”).  Novipax had entered into an Asset Purchase Agreement (“APA”) in connection with its acquisition of Sealed Air’s foam tray and pads business.  
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Judge Johnston Denies Request for New Trial and Declines to Award Attorneys’ Fees in Environmental Indemnification Dispute
In Clean Harbors, Inc. v. Union Pacific Corp., C.A. No. N15C-07-081 MMJ CCLD, Judge Johnston decided post-trial motions following a jury verdict in a breach of contract case. Plaintiff Clean Harbors, Inc. had sued defendant Union Pacific Corporation (“UPC”) for breaching an environmental indemnity provision in a stock purchase agreement (“SPA”). Specifically, Clean Harbors sought to recover remediation costs for a hazardous waste facility its predecessor had purchased from UPC.  
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Judge Davis Considers Challenge to Personal Jurisdiction over Corporate Officers
In Turf Nation, Inc. v. UBU Sports, Inc., C.A. No. N17C-01-271-EMD [CCLD], Judge Davis granted an individual defendant’s motion to dismiss the plaintiff’s complaint for lack of personal jurisdiction. This case began when plaintiff Turf Nation, Inc. sued defendant UBU Sports, Inc. for breach of contract.   
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Judge Davis Grants Request for Attorneys’ Fees but Denies Request for Interest
In Boeing Co. v. Spirit Aerosystems, Inc., C.A. No. N14C-12-055 EMD CCLD (Dec. 5, 2017), Judge Davis granted in part and denied in part the defendant’s Motion for Attorneys’ Fees, Costs, Expenses and Pre- and Post-Judgment Interest, awarding the defendant’s request for fees but denying the request for interest. 
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Judge Wallace Dismisses Contract Claims but Allows Implied Covenant and Unjust Enrichment Claims to Proceed
In Raytheon Co. v. BAE Systems Technology Solutions & Services Inc., 2017 WL 5075376 (Del. Super. Ct. Oct. 30, 2017), Raytheon Company brought suit against BAE Systems Technology Solutions & Services alleging seven counts: (1) breach of contract, (2) breach of the implied covenant of good faith and fair dealing, (3) contractual indemnification, (4) unjust enrichment, (5) negligent misrepresentation, (6) tortious interference with contractual relations, and (7) a tort related to damaged trade and profession. 
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Judge Wallace Grants Motion for Judgment on the Pleadings for Declaratory Judgment of No Coverage in Insurance Dispute
In Catlin Specialty Insurance Co. v. CBL & Associates Properties, Inc., C.A. No. N16C-07-166 PRW CCLD (Sept. 20, 2017), Judge Wallace denied the defendants’ Motion for Judgment on the Pleadings, and granted the plaintiff’s Motion for Judgment on the Pleadings on all counts except a claim for unjust enrichment. In their cross-motions, both parties requested a declaratory judgment to establish whether the governing insurance policy provided coverage for a lawsuit against the defendants. 
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