Complex Commercial Litigation Update
September 14, 2021
Publication| Commercial Litigation
The third quarter of 2021 was another busy one for the Delaware Superior Court’s Complex Commercial Litigation Division (“CCLD”). While civil jury trials are still backlogged as a result of the pandemic, the CCLD judges continued to issue numerous opinions in cases involving acquisition disputes and pharmaceutical development. For past issues of this mailing or information about the CCLD, please visit our website.
Judge Wallace Denies Both Motion for Reargument and Motion for Stay or Enlargement of Time in Acquisition Dispute Involving a Timeshare Business
In CRE Niagara Holdings, LLC, et al. v. Resorts Group, Inc., C.A. No. N20C-05-157 PRW CCLD, Judge Wallace denied the defendant’s motion for reargument of its motion to dismiss, and also denied the defendant’s separate motion for stay or enlargement of time. The underlying dispute arose from Resorts Group, Inc.’s (“RGI”) 2017 sale of a resort and timeshare business to CRE Niagara Holdings, LLC (“CRE”). In May 2020, CRE brought the instant action charging RGI with fraud and breach of contract for alleged false representations made to induce CRE to execute a unit asset purchase agreement (“UAPA”) and two ancillary agreements. CRE alleged that, prior to closing, RGI had “dramatically relaxed its underwriting standards” and began selling timeshare interests to purchasers who were less creditworthy than past buyers.
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Judge Wallace Allows Fraud Claims to Proceed to Trial in Pharmaceutical Case While Trimming Various Counterclaims for Breach of Contract and Fraudulent Transfer
In Humanigen, Inc. v. Savant Neglected Diseases, LLC, C.A. N17C-07-068 PRW CCLD, Judge Wallace denied a motion for summary judgment by Savant Neglected Diseases (“Savant”), granted in part and denied in part a motion for summary judgment by Humanigen, Inc. (“Humanigen”) and Madison Joint Venture LLC (“Madison” and, together with Humanigen, “H&M”), and granted a motion for summary judgment filed by Nomis Bay Ltd. (“Nomis”).
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Judge Davis Applies Delaware Law to Tortious Interference Claim, Finding No Conflict
In KT4 Partners LLC v. Palantir Technologies, Inc., C.A. No. N17C-12-212 EMD CCLD, Judge Davis granted in part and denied in part the defendants’ motions for summary judgment. The plaintiffs filed suit alleging that the defendants tortiously interfered with a prospective business relationship the plaintiffs had with CDH Investments (“CDH”) to sell the plaintiffs’ stock through a secondary securities transaction. The plaintiffs also alleged that the defendants conspired to steer CDH away from the plaintiffs so that the defendants could appropriate the stock transaction for themselves. The parties disputed which state’s law would apply to the tortious interference claim.
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Judge Davis Applies McWane Factors and Grants Defendant’s Motion to Stay
In Highland Pipeline Leasing, LLC v. Magellan Pipeline Company, L.P., C.A. No. N20C-08-275 EMD CCLD, Judge Davis granted the defendant’s motion to stay. In the underlying dispute, Magellan Pipeline Company L.P. (“Magellan”) entered into an agreement to lease a 158-mile pipeline in Arkansas (the “Ozark Line”) from Highland Pipeline Leasing LLC (“Highland”), with Spectra Energy Partners, LP (“Spectra”) serving as guarantor of the lease. In August 2017 Magellan reported issues with the Ozark Line. Pursuant to the lease, Magellan sought certain repair costs from Highland, and Highland denied responsibility for the costs.
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