Posts in Jurisdiction

Court Of Chancery Explains Conspiracy Theory Of Jurisdiction

Virtus Capital L.P. v. Eastman Chemical Company, C.A. 9808-VCL (February 11, 2015) This is a very useful decision because of its detailed explanation of the conspiracy theory of jurisdiction, which was first adopted in the famous Istituto Bancario case. As the decision makes clear, breaches of fiduciary duty claims are particularly suited for that theory and do not violate the corporate shield doctrine. Share

Court Of Chancery Explains Equitable Estoppel Jurisdiction

McWane Inc. v. Lanier, C.A. 9488-VCP (January 30, 2015) This decision explains how a non-party to a contract with a Delaware forum selection clause may still be subject to the Court's jurisdiction under an equitable estoppel theory. Briefly, if you claim benefits under that contract, you may be barred from contesting its forum selection provision. Share

Court Of Chancery Explains Pro Se Procedure

Alfred v Walt Disney Co., C.A. 10211-VCG (January 14, 2015) This decision has generated a lot of comment about the plaintiff's outlandish complaint. However, it is also a good source on Delaware law dealing with how to treat pro se complaints, particularly what leniency they will receive.  Note as well the kindness of the Court to this litigant, which is to be commended. Share

Court Of Chancery Upholds Jurisdiction Over Non-resident Manager

2009 Caiola Family Trust v. PWA LLC, C.A. 8028-VCP (December 18, 2014) This decision is interesting because it upholds the Court of Chancery's jurisdiction over a non-resident who, through a non-Delaware entity, manages a Delaware LLC.  Thus, simply putting a non-resident entity between you and the Delaware entity will not always shield you from Delaware's jurisdiction. Share

Court Of Chancery Explains The Conspiracy Theory Of Jurisdiction

Reid v. Siniscalchi, C.A. 2874-VCN (November 20, 2014) Under the conspiracy theory of jurisdiction, a non-resident may still be subject to Delaware court jurisdiction if a co-conspirator commits an act in Delaware in furtherance of the conspiracy. While that is a simplified version of the law, this decision explains the theory in detail. Share

District Court Reviews Website As Basis For Jurisdiction

Inno360, Inc. v. Zakta, LLC, No. 13-1790-SLR (June 19, 2014) This decision has a good review of when just posting a web page is enough to support jurisdiction over the posting party. Share

Court Of Chancery Upholds Service By Mail

Sustainable Energy Generation Group v. Photon Energy Projects B.V., C.A. 8524-VCP (May 30, 2014)

This decision upholds service of process by mail under the Hague Convention.

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Court Of Chancery Retains Suit After Martinez Ruling

VTB Bank v. Navitron Projects Corp,. C.A. 8514-VCN (April 28, 2014)

After the Delaware Supreme Court's Martinez decision dismissing a case on forum grounds, some thought that Delaware might reject other cases as well. This decision limits Martinez's scope and makes it clear that Delaware entities will be subject to Delaware jurisdiction in the circumstances where the activities of the entity "implicates [the Court of Chancery's] fundamental and immutable responsibility to supervise the entities chartered and formed under Delaware law."  While that mandate is clearly limited to some set of cases less than the universe of disputes a corporation may be subject to, what is covered remains to be seen.

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District Court Clarifies Who Is A Manager

Wakley Limited v. Ensotran LLC, C.A. 12-728-GMS (March 18, 2014)

Under the Delaware LLC Act, a manager or a person who acts like a manager is subject to jurisdiction in Delaware in a breach of duty case arising out of her management.  Because the LLC agreement usually sets out who is a "manager," that is usually not disputed.  However, it is often less clear who had exercised management duties sufficient to be subject to jurisdiction in Delaware. This decision helps decide that question. It points out that just being named an officer is not enough to submit to jurisdiction and that the nature of the defendant's' duties compared to what it is alleged she did improperly may also be determinative.  In other words, if you "managed" X project but are sued for what you did on the Y project, there is no jurisdiction over you..

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Court Of Chancery Clarifies Jurisdiction

Darby Emerging Markets Fund L.P. v. Ryan,  C.A. 8381-VCP (November 27, 2013)

This decision clarifies the Court of Chancery's jurisdiction under the clean up doctrine and when a contract subject to specific performance has not yet been breached.

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Court Of Chancery Explains Conspiracy Jurisdiction

Lake Treasure Holdings Ltd. v. Foundry Hill GP LLC, C.A. 6546-VCL (November 21, 2013)

The so-called conspiracy theory of jurisdiction over a non-resident is often misunderstood. This decision is useful because: (1) it explains the relationship between jurisdictional discovery and the burden of alleging facts sufficient to establish jurisdiction and (2) it again explains what must be shown to warrant jurisdiction under the conspiracy theory.

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Court Of Chancery Explains Limits Of Jurisdiction Over Foreign Entities

Baier De Adler v. Upper New York Investment Companies LLC, C.A. 6896-VCN (October 31, 2013)

This is an interesting decision dealing with jurisdiction over foreign entities. The Court will not take jurisdiction when the assets involved are located outside the US and not owned by a Delaware entity

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Court Of Chancery Again Explains Conspiracy Theory Of Jurisdiction

Microsoft Corporation v. Amphus, Inc., C.A. 8092-VCP (October 31, 2013)

The alter ego and conspiracy theories of jurisdiction are among the hardest to understand.  This decision carefully and clearly applies those theories to a complicated fact pattern.

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Court Of Chancery Upholds Forum Selection Bylaw

Boilermakers Local 154 Retirement Fund v. Chevron Corporation, C.A. 7220-CS (June 25, 2013)

The Court of Chancery has upheld a bylaw that selects Delaware as the only forum for internal corporate disputes. The Court  did leave open the possibility that such a bylaw might be later challenged on narrow grounds that it was improper in limited circumstances.

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Supreme Court Reinvigorates Istituto Bancario

Matthew v. Flakt Woods Group SA, No. 150, 2012 ( November 20, 2012)

For some time the conspiracy theory of jurisdiction, first set out in the famous Istituto Bancario decision, has had little success in conferring jurisdiction over foreign entities.  With this new decision by the Delaware Supreme Court, that trend may be reversed.  The key holding is that the defendant should have known that it was involved with a Delaware corporation and  the dissolution of that company as part of the alleged conspiracy was enough to give jurisdiction over the non-US defendant.  While the parameters of this possible extension of jurisdiction are to be determined later, it may be very broad.

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