Delaware Business Litigation Report

Court Of Chancery Declines To Intervene In Arbitration

LG Electronics, Inc. v InterDigital Communications Inc., C.A. 9747-VCL (August 20, 2014) This is the first decision by the Court of Chancery that dismissed a case over which it has jurisdiction because an arbitration proceeding had been filed first.  As the court points out, this is unusual because the court usually dismisses cases in favor of arbitration when the court lacks jurisdiction to hear disputes subject to an arbitration provision.  Here, however, both the court and the arbitration panel had jurisdiction so that a dismissal on those grounds was not appropriate.  Instead, the Court applied the McWane doctrine whereby a case is dismissed when a first-filed proceeding elsewhere will do justice between the parties. The decision is interesting because it also holds that the court will not interfere in how another proceeding is being conducted.  While that may not always be true, it is a useful reminder of the limits of what the Court of Chancery will get involved in most of the time. Share