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Summaries and analysis of recent Delaware court decisions concerning business-related litigation.
Morris James Blogs
Showing 6 posts in Uncategorized.
Posted In UncategorizedIn Re Numoda Corporation Shareholders Litigation, C.A. 9163-VCN (January 30, 2015) This is an important decision because it explains the effect of the new Sections 204-205 to the DGCL. Those provisions permit the correction of corporate actions that failed to comply with the requirements of the DGCL, such as having a board resolution before issuing stock. The decision holds that the Court's authority is limited to when some actual "action" has occurred, not just a "water cooler discussion" and there must be some real evidence to confirm that action was intended to have the consequences the plaintiff asks the Court to confirm.
Posted In UncategorizedOptimiscorp v. Waite, C.A. 8773-VCP (January 28, 2015) This decision is a primer on what not to do if you want to add claims to a complaint as the case develops. The lesson is to be sure that your discovery responses are both timely updated and sufficient to put the opposing side on notice and to move as early as possible to amend.
Posted In UncategorizedTrustCo Bank v. Mathews, C.A. 8374-VCP (January 22, 2015) There is perhaps no more confusing subject in Delaware non-corporate law than the application of the Delaware borrowing statute to statute of limitations issues. Under Supreme Court case law, the literal application of the borrowing statute is avoided under certain limited circumstances, often involving a plaintiff trying to avoid liability by forum shopping. In any case, this decision explains very well how to apply the borrowing statute.
Posted In UncategorizedSinchareonkul v. Fahnemann, C.A. 10543-VCL (January 22, 2015) This is a helpful reminder that the DGCL governs what may be in the certificate of incorporation and what may be in the bylaws. Giving one director extra tie-breaking voting rights must be in the certificate to be valid.
Posted In Breach of Contract, Uncategorizedev3 Inc v. Lesh, No. 515, 2013 (Del. September 30, 2014) Delaware law favors a strict interpretation of contract language. Here, the Supreme Court rejected an attempt to read into a contract provisions from a letter of intent signed before the final contract was executed. The final contract did not provide by its literal terms such an interpretation and the Supreme Court would not have any of the plaintiff's attempts to read it otherwise.
Posted In UncategorizedDent v. Ramtron International Corporation, C.A. 7950-VCP (June 30, 2014) There is a general sense that it is hard to have the Court of Chancery grant a motion to dismiss litigation attacking a proposed merger. While that may be true when the merger involves insiders, this decision demonstrates that an arms length transaction subject to typical deal protection provisions is not easily attacked absent some hard facts supporting the claim. Without those well-pleaded facts, the Court will dismiss the suit.