Delaware Business Litigation Report

Court Of Chancery Again Rejects Limits On Advancement Rights

Fillip v Centerstone Linen Services LLC, C.A. 8712-ML (May 1, 2014)

This is another case where a company tries to avoid its advancement obligation by arguing that the conduct in question did not arise out of the former officer's official duties, but instead arose under an employment or similar contract.  That distinction just does not work and it did not work here.  The decision is also interesting because it points out that advancement rights in an LLC are not limited by the statutory language of Section 145 of the DGCL dealing with actions in "defense."

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