Showing 159 posts from 2005.
Federal Court Transfers Venue Under The Jumara v. State Farm Ins. Co. Articulation Of 28 U.S.C. Section 1412 Multifactor Considerations.
Posted In JurisdictionBank of America, N.A. (USA) v. US Airways, Inc., No. Civ. A. 05-793-JJF, 2005 WL 3525680 (D.Del. Dec. 21, 2005). This is an action founded on tort and breach of contract. The Court granted defendants' motion to transfer the action to the Eastern District of Virginia and denied, without ruling, plaintiff's motion for expedited remand to the Delaware Court of Chancery. Defendants include three Delaware entities: US Airways, Inc., US Airways Group, Inc., and America West Airlines, Inc. The first two defendants maintained their principal place of business in Virginia. America West, Inc., maintained its principal place of business in Arizona. Additionally, Juniper Bank intervened as a defendant. More › Share
Court of Chancery Substantially Denies Motion to Dismiss Complaint Seeking Release of Escrowed Funds and Other ReliefBonham v. HBW Holdings, Inc., C.A. No. 820-N, 2005 WL 3589419 (Del. Ch. Dec. 23, 2005). Former stockholders sued acquirer for release of $25 million held in escrow for purpose of indemnification for breach of warranty claims and other relief. The acquirer moved to dismiss the complaint on the grounds that it properly and timely noticed claims for breach of warranty and other issues, Plaintiffs failed to allege that those claims were made in bad faith, and certain of the claims were subject to mandatory arbitration under the terms of the stock purchase agreement. More › Share
Court of Chancery Grants Partial Summary Judgment with Respect to Claims that Former Controlling Stockholder Extracted Excess Compensation from Acquirer in Exchange for Supporting MergerCrescent/Mach I Partnership, L.P. v. Turner, C.A. No. 17455-NC, 2005 WL 3618279 (Del. Ch. Dec. 23, 2005). Former stockholders who were cashed out in connection with merger sued the corporation's former controlling stockholder and the acquirer for breach of fiduciary duty and aiding and abetting breach of fiduciary duty, respectively. Plaintiffs complained of numerous side deals, allegedly negotiated by the controlling stockholder. Plaintiffs also complained that the controlling stockholder breached his fiduciary duty by supplying growth projections that he knew to be unduly pessimistic and inconsistent with management's view. Defendants moved for summary judgment, which the court granted in part and denied in part. More › Share
Posted In InjunctionsBally Total Fitness Holding Corp. v. Liberation Investments, L.P., Liberation Investments, Ltd., Liberation Investment Group, LLC and Emanuel R. Pearlman, 2005 WL 3525679 (D.Del., December 22, 2005). The District Court for the District of Delaware granted Defendants' Motion to Dismiss Plaintiff's Preliminary Injunction application. At issue were SEC mandated disclosures in advance of the annual shareholders' meeting. More › Share
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Unisuper v. News Corp., C.A. No. 1699-N, 2005 WL 3529317 (Del. Ch. Dec. 20, 2005). In the context of converting from an Australian corporation to a Delaware corporation, News Corp.'s board adopted a policy that if a shareholder rights plan was adopted following reincorporation, the plan would have a one-year sunset clause unless shareholder approval was obtained for an extension. The policy also provided that if shareholder approval was not obtained, the company would not adopt a successor shareholder rights plan having substantially the same terms and conditions. Several weeks later, News Corp.'s board adopted a poison pill in response to a specific third-party takeover threat. One year later, the board extended the poison pill without a shareholder vote, in contravention of its prior policy. More › Share
Henke v. Trilithic Inc., C.A. No. 13155, 2005 WL 2899677 (Del. Ch. Oct. 28, 2005). Plaintiff, who was a stockholder of Trilithic, Inc., brought an appraisal action against Defendant Trilithic under 8 Del. C. §262. More › Share
Court Enforces Lease Provision Protecting Supermarket from Competition from Other Shopping Center TenantsPenn Mart Supermarkets, Inc. v. New Castle Shopping LLC, C.A. No. 20405-NC, 2005 WL 3502054 (Del. Ch. Dec. 15, 2005). Liquor store chain acquired leasehold rights in commercial shopping center under a Bankruptcy Court order that authorized it to operate one of its typical stores. In addition to alcohol products, those chain stores also sold food products and a wide range of products typically sold in supermarkets. Tenant who operated supermarket in same shopping center sued landlord and liquor store to enforce provision in its lease protecting it from competition by other tenants in the operation of a supermarket and in the sale of food or food products intended for off-premises consumption. More › Share
Court of Chancery Holds Contractually Granted Advancement Rights Not Abrogated by Subsequent Indemnification Agreement Containing Integration ClauseBrady v. i2 Technologies Inc., C.A. No. 1543-N, 2005 WL 3691286 (Del. Ch. Dec. 14, 2005). A former executive and director sought advancement of his expenses in connection with the defense of certain proceedings based on a standard corporate advancement provision in a 1996 indemnification agreement. Defendant corporation argued that an integration clause in a subsequent 2002 severance agreement, which stated that the 2002 agreement expressed the entire agreement between the parties "with respect to the subject matter hereof," abrogated the advancement obligation imposed by 1996 agreement. More › Share
Court Grants Significantly Smaller Fee Award Than That Sought by Plaintiffs' Counsel in Connection with Settlement of Derivative ActionIn re Instinet Group, Inc. Shareholders Litig., C.A. No. 1289-N, 2005 WL 3501708 (Del. Ch. Dec. 14, 2005). Following the court's approval of settlement of derivative claims, Plaintiffs' counsel applied for an allowance of $1,450,000 in contingency fees and $173,031.07 in costs. Defendants agreed that Plaintiffs' attorneys were entitled to some award of fees and expenses, but objected to counsel's request as excessive under the circumstances on the grounds that (1) the litigation benefits achieved were modest, (2) the case settled at an early stage, and (3) Plaintiffs' counsel litigated the case ineffectively. More › Share
Court Dismisses Claim That Board Breached Fiduciary Duty by Failing to Seek Recovery of Bonus that Turned Out to Be Unjustified After Accounting RestatementLaties v. Wise, C.A. No. 1280-N, 2005 WL 3501709 (Del. Ch. Dec. 14, 2005). In 2001, Defendant corporate executive received bonuses and other compensation near $9 million as CEO, due in some part to the corporation's reported profits that year. Several years later, after that executive's departure, the corporation restated its 2001 performance from a $93 million profit to a $447 million loss. Plaintiff brought a derivative claim against executive for unjust enrichment, and against the present directors of the corporation for breach of fiduciary duty and waste. Defendants moved to dismiss under Court of Chancery Rule 23.1. More › Share
Court Denies Motion to Dismiss Claims for Tortious Interference and Civil Conspiracy in Connection with Telecommunications Merger
Posted In Business TortsUbiquiTel v. Sprint Corporation, C.A. No. 1489-N, 2005 WL 3533697 (Del. Ch. Dec. 14, 2005, rev'd Dec. 19, 2005). UbiquiTel was the exclusive operator of Sprint's wireless network in several states pursuant to a management agreement. In December 2004, Sprint announced that it intended to merge with Nextel and that Nextel or its successor entity would be taking over much of the work that had previously been performed by UbiquiTel. In response, UbiquiTel sued Sprint and Nextel alleging a number of claims, including tortious interference and civil conspiracy against Nextel. Nextel moved to dismiss for failure to state a claim. More › Share