Posts tagged Jurisdiction

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.

Share

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.

Share

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

Share

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.

Share

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.

Share

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.

Share

Court Of Chancery Dismisses Improperly Notarized Complaint

Bessenyei v. Vermillion, Inc., C.A. 7572-VCN (November 16, 2012)

This is a troubling decision.  One plaintiff, through the efforts of the other plaintiff who is a lawyer, used a false verification when the complaint was filed. The Court of Chancery requires all complaints be verified.  As a result, the Court dismissed the complaint under the rule of Parfi where the dismissal is on the merits.

Seems right so what is troubling?  Delaware lawyers typically believe their clients when they are sent a verification that the client did what the verification says, appeared before a notary to sign it. This is an odd case because there was some indication that was not being done. Still, how far should we  go?  The short answer is that we need to ask the client: "Did you get this signed in front of a notary like it says"?

Share

Court of Chancery Dismisses Limited Liability Partnership Act Suit

New Media Holding Company LLC v. Brown,  C.A. 7516-CS (November 14, 2012)

This decision deals with a hole in Delaware jurisprudence.  Generally, the statutes authorizing each form of Delaware entity contain a provision whereby the managers of that entity submit themselves to the jurisdiction of the Delaware courts for acts in their managerial capacity.  But, as this decision points out in dismissing the complaint for want of personal jurisdiction over the defendants, that is not the case under the Delaware limited liability partnership statute.  This seldom used act may need to be amended as a result.

Share

Court Of Chancery Explains Conspiracy Jurisdiction

Hospitalists of Delaware, LLC. v. Lutz, C.A. 6221-VCP (August 28, 2012)

This is an important decision because it explains the theory of jurisdiction over alleged conspirators. While that basis for jurisdiction has been around since the Istituto Bancario decision, it is still hard to understand.  The guidance this decision provides to that law and the conspiracy theory in general is very helpful.

Share

Court Of Chancery Explains Limits Of Jurisdictional Discovery

Picard v. Wood, C.A. 6526-VCG (July 12, 2012)

A plaintiff must offer some basis to believe the defendant is subject to the Court's jurisdiction before he will be permitted to take jurisdictional discovery.  Owning an interest in a Delaware LLC is not enough.

Share

Court Of Chancery Permits Jurisdictional Depositions

Reid v. Siniscalchi, C.A. 2874-VCN (May 25, 2012)

Discovery in aid of proving jurisdiction is usually available.  But is there a limit?  This decision explores that question and permits depositions to prove jurisdiction.

Share

Court Of Chancery Resolves Who May Bring Derivative Claims After Dissolution

Matthew v. Laudamiel, C.A. 5957-VCN (February 21, 2012) This decision resolves who may bring a derivative claim after an LLC has been dissolved.  The argument made by 1 of the parties was that after dissolution, any member may bring a derivative claim directly.  The Court rejected that argument and concluded that the claim still must be brought in the name of the LLC and that a petition might also be filed to have the entity restored to bring such a claim or for a trustee to be appointed to do so. This decision also dealt with an important jurisdictional issue under the so-called conspiracy theory.  It holds that the alleged conspirator must be aware that the conspiracy involves an action in Delaware in furtherance of the conspiracy, before the conspiracy is completed and the harm done. Share

Court Of Chancery Explains The Incorporation Basis For Personal Jurisdiction

Connecticut General Life Insurance Company v. Pinkas, C.A. 5724-VCN (October 28, 2011)

It is sometime claimed that the act of incorporating a Delaware corporation is enough to subject the incorporator to jurisdiction in Delaware.  After all, an old case does do just that.  But as this decision points out, the act of incorporating has to be an integral part of the actions that give rise to the claims asserted.  That is not so easy to show and did not work in this case.

Share

Superior Court Upholds Jurisdiction After Merger

Universal Capital Management Inc. v. Micco World Inc., C.A. 10C-07-039 RRC (June 2, 2011)

This is a useful case because it covers just about every basis to assert jurisdiction over non-Delaware residents for their actions in Delaware.  It also upholds jurisdiction over a former Delaware corporation that merged out of Delaware.

Share

Court Of Chancery Explains Jurisdictional Discovery

Reid v. Siniscalchi,  C.A. 2874-VCN (January 31, 2011)

 When personal jurisdiction over a defendant is challenged, the plaintiff has the right to take limited "jurisdictional discovery."  Exactly what that means is well explained by this decision.

Share