In the second quarter of 2019, the CCLD judges handled numerous contract cases and, in a series of opinions, reinforced that the implied covenant of good faith and fair dealing should be applied “sparingly.” There was also a multi-week jury trial in a case involving a dispute over a business acquisition.
For a number of years, the Delaware Limited Liability Company Act (the “LLC Act”) has permitted Delaware limited liability companies (“LLCs”) to establish designated series of members, managers, limited liability company interests or assets. In 2007, the LLC Act was amended to provide series the power and capacity to, in their own names, enter into contracts,…
Stockholder plaintiffs generally face a high burden insurviving a motion to dismiss on so-called Caremarkclaims challenging the board’s compliance with its dutyof oversight. A recent Delaware Supreme Court opinionillustrates the circumstances in which a plaintiff makinga Caremark claim may withstand a motion to dismiss.It also provides guidance on implementing and monitoringsystems and controls to…
Over the last three decades, the demands placed on public company directors have increased exponentially. In addition to ordinary course audit committee, compensation committee, compliance and business oversight work, directors are now expected to animate the company’s sustainability programs, focus a keen eye on boardroom diversity and “refreshment,” understand cyber and other enterprise risks, and assure…
In Stein v. Blankfein, C.A. No. 2017-0354-SG (Del. Ch. May 31), the Delaware Court of Chancery issued one of its firstopinions addressing director compensation following the Delaware Supreme Court’s ruling in In re Investors BancorpStockholder Litigation, 177 A.3d 1208 (Del. 2017), that stockholder approval of a compensation plan may only “ratify”future director awards if the board…
In Shareholder Representative Services LLC v. RSI Holdco, LLC, C.A. No. 2018-0517-KSJM (Del. Ch. May 29, 2019), the Delaware Court of Chancery upheld a provision in a private-company merger agreement precluding a buyer from using the seller’s privileged emails against the seller in post-closing litigation. Following the guidance from the decision in Great Hill Equity Partners…
In Belcher Pharmaceuticals, LLC v. International Medication Systems, Ltd., No. 18-960-LPS-CJB (Mar. 31, 2019), Chief Judge Stark denied the defendant’s motion to dismiss for failure to state a claim. The defendant had filed a new drug application under 21 U.S.C. § 355(b)(2) with a Paragraph IV certification that the patent-in-suit was invalid, prompting the litigation. The…
In Cosmo Technologies Ltd. v. Actavis Laboratories FL, Inc., No. 15-164-LPS (Mar. 27, 2019), and related case, Chief Judge Stark granted the defendants’ motion to declare the cases exceptional and to award attorneys’ fees. At trial, the Court granted the defendants’ motion for judgment of non-infringement on partial findings under Fed. R. Civ. P. 52(c) at…
In Dorco Co. v. Gillette Co., No. 18-1306-LPS-CJB (Mar. 14, 2019), Chief Judge Stark denied the defendant’s motion to stay pending arbitration (brought both under the Federal Arbitration Act and as a matter of judicial discretion) and denied as moot the plaintiff’s motion to enjoin arbitration. The parties agreed that an earlier settlement agreement between them…