Delaware Business Litigation Report

Court Of Chancery Notes The Outer Limits Of Contract/Fiduciary Claims

The Renco Group Inc. v. MacAndrews AMG Holdings LLC, C.A. 7668-VCN (April 20, 2015)

There is a long line of decisions that holds when the parties set out their mutual rights and obligations in a contract, only contract law governs and a breach of fiduciary duty claim cannot also be brought. That has other consequences because that also means that an aiding and abetting claim cannot be filed against third parties for helping a party breach its contract. There is no such claim under Delaware law. That is not true if the underlying claim was for breach of fiduciary duty where aiding and abetting claims are well recognized. In short, how to characterize the breach claim has real consequences insofar as suing third parties is concerned. This decision sets out this law and the issues, without resolving them, but in a helpful way.

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