Delaware Chancery Law Blog
The Delaware Court of Chancery is widely considered the preeminent forum for resolving disputes involving the internal affairs of the multitude of Delaware corporations and other business entities through which a vast amount of the world's commercial affairs is conducted. Join Carl as he helps guide you through the complex landscape of legal issues and analysis arising before this Court.
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Delaware Bankruptcy Litigation Blog
Carl shares his knowledge of Delaware bankruptcy proceedings in a blog entitled, "Delaware Bankruptcy Litigation." He offers his take on corporate bankruptcy proceedings not only in Delaware but throughout the United States, as well as industry insight on topics such as preference litigation, tenant bankruptcy and defending avoidance litigation.
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Recent Blog Posts

  • Chancery Approves Sale of TransPerfect Global, Inc. The Delaware Court of Chancery recently approved a plan to sell TransPerfect Global, Inc. (“TransPerfect” or the “Company”) to co-owner Philip Shawe. In the Court’s most recent opinion issued earlier on February 15, 2018, In re TransPerfect Global, Inc., C.A. No. 9700-CB (Del. Ch. Feb. 15, 2018), Chancellor Bouchard  approved a sale agreement that permitted Shawe to acquire shares of the company owned by Elting.  Specifically, the Court accepted the recommendation of the court-appointed Custodian to approve a transaction in which one of the... More
  • Conspiracy Theory of Personal Jurisdiction Analyzed by Chancery In the recent decision of Reid v. Siniscalchi, C.A. No. 2874-VCS (Del. Ch. Jan. 30, 2018), the Court of Chancery analyzed the “conspiracy theory” of personal jurisdiction. According to the Court: Under the conspiracy theory of personal jurisdiction, the parties to a conspiracy are treated as each other’s agents with respect to acts in furtherance of the conspiracy. Thus, a substantial Delaware act by a conspirator in furtherance of the conspiracy may be attributed to nonresident co-conspirators if the co-conspirators knew or had... More
  • Preference Actions filed in Hancock Fabrics On January 31, 2018, Hancock Fabrics Inc., the post-effective date debtor, filed approximately 68 complaints seeking the avoidance and recovery of allegedly preferential and/or fraudulent transfers under Sections 547, 548 and 550 of the Bankruptcy Code. The Debtors filed voluntary petitions for bankruptcy in the U.S. Bankruptcy Court for the District of Delaware on February 2, 2016 under Chapter 11 of the Bankruptcy Code.  On June 20, 2017, the Court entered an order confirming the Debtors’ Second Amended Joint Chapter 11... More
  • Life Insurance Investment Company Files for Bankruptcy in Delaware On December 29, 2017, Life Settlement Absolute Return I, LLC (“LSAR”), along with Senior LS Holdings, LLC (“Senior LS”; collectively with LSAR, the “Debtors”), filed petitions for relief under Chapter 11 in the Bankruptcy Court for the District of Delaware (Case Nos. 17-13030 and 17-13031). According to the Declaration in Support of the First Day Motions of Robert J. Davey, III (“Davey Declaration”), LSAR was formed as a special purpose vehicle to invest in life insurance policies in the life settlement market. LSAR has comprehensive... More
  • Dell Appraisal Decision Overturned – Deal Price Given Substantial Weight In a long awaited and highly anticipated ruling, the Delaware Supreme Court overturned the Court of Chancery’s decision in the Dell appraisal action, Dell v. Magnetar Global Event Driven Master Fund, No. 565, 2016 (Del. Supr. Dec. 14, 2017). By way of background, in the 2016 Court of Chancery opinion, In re: Appraisal of Dell Inc., C.A. No. 9322-VCL (Del. Ch. May 31, 2016), Vice Chancellor Laster found fair value of the Dell merger to be 22% greater than the deal price, holding that deal... More
  • Caremark Claims Analyzed by Delaware Court of Chancery In the recent decision of Oklahoma Firefighters Pension & Retirement System v. Corbett, C.A. No. 12151-VCG (Del. Ch. Dec. 18, 2017), the Delaware Court of Chancery provided a scholarly review of Caremark claims.  In sum, the decision stands for the proposition that in order to survive a motion to dismiss, a plaintiff must plead sufficient facts demonstrating a deliberate violation of the law or a conscious indifference to wrongdoing. It is worth noting that Caremark claims are notoriously difficult to prove.  The Court of Chancery has previously... More
  • Supreme Court Upholds Dismissal of Caremark Claim In the recent opinion by the Delaware Supreme Court of Chancery in City of Birmingham Retirement and Relief System v. Good, No. 16, 2017 (Del. Supr. Dec. 15, 2017), the High Court held that stockholder plaintiffs failed to adequately plead demand futility in the connection with Caremark claims asserted against the company’s board of directors.  The majority’s en banc opinion should be read by any practitioner seeking to understand the demand futility analysis under Delaware law. The complaint was filed as a derivative action on behalf... More
  • Chancery Enforces Oral Agreement to Expand Board in Section 225 Action In the recent decision of Sarissa Capital Domestic Fund LP v. Innoviva, Inc., C.A. No. 2017-0309-JRS (Del. Ch. Dec. 8, 2017), a disputed oral settlement agreement was specifically enforced by the Delaware Court of Chancery in a proxy contest between Innoviva, Inc. and Sarissa Capital Management resulting in two dissident directors being seated on the board of directors of Innoviva. Vice Chancellor Slights held that the principals of Innoviva and Sarissa had entered into a valid, binding oral agreement that required Sarissa to... More
  • Chancery Denies Request for Injunctive Relief Regarding State Contract Award The recent opinion of Protech Solutions, Inc. v. The Delaware Department of Health and Human Services, C.A. No. 2017-0642-TMR (Del. Ch. Nov. 30, 2017) sets forth a helpful roadmap in terms of the Court’s determination of whether to uphold a state contract for professional services. There, Plaintiff Protech Solutions, Inc. (“Protech”) challenged the decision of the State of Delaware Department of Health and Social Services, Division of Child Support Services to grant a contract to another bidder in response to a Request for... More
  • Pre-Merger Suit Deemed Premature by Chancery, Dismissal Granted In a recent decision by the Delaware Court of Chancery, In re Straight Path Commc’ns Inc. Consol. S’holder Litig., Civil Action No. 2017-0486-SG (Del. Ch. Nov. 20, 20107), Vice Chancellor Glasscock stayed consideration of a pre-merger complaint brought by a stockholder, alleging claims that the controlling shareholder obtained a side deal at the expense of the corporation.  Because the deal had not yet consummated, plaintiff stockholder only sought monetary damages, while not opposing the closing of the merger.  Plaintiff asserted... More
  • Section 220 Demand Denied in Lawyer-Driven Litigation In the recent decision of Wilkinson v. Schulman, C.A. No. 2017-0138-VCL (Del. Ch. Nov. 13, 2017), the Court of Chancery denied a Section 220 books and records demand on the basis that even though the demand stated a “proper purpose”, the purpose was merely crafted by counsel for the stockholder in a lawyer manufactured litigation. The Court found that Wilkinson’s service as a nominal plaintiff for his law firm, Levi & Korsinksy LLP (“L&K”), in this action is consistent with his past relationship with... More
  • Real Industry Inc. Files for Chapter 11 Bankruptcy Relief in Delaware On November 17, 2017, Real Industry, Inc., along with its subsidiaries and affiliates (collectively the “Debtors” or “Real Industry”), filed a petition for relief under Chapter 11 in the Bankruptcy Court for the District of Delaware (Case No. 17-12464). According to the Declaration in Support of First Day Motions of Michael J. Hobey, liquidity issues and certain singular negative events have led to Real Industry’s bankruptcy filing. The Debtors operate an aluminum recycling and alloy production company based in Beachwood, Ohio. Contemporaneously, Real Alloy... More
  • Chancery Denies Derivative Action for Failure to Plead Demand Futility Under Delaware law, if a shareholder requests that a company pursue litigation, the decision whether to pursue litigation on behalf of the company generally resides with the board as an exercise of its business judgment.  A stockholder lacks standing to bring suit on the company’s behalf unless the stockholder (i) has demanded that the directors pursue the corporate claim and the demand is wrongfully refused; or (ii) purports to initiate litigation on behalf of the company and alleges with particularity... More
  • Digital Audio Files of the Delaware Bankruptcy Court Available Over the Internet Effective November 6, 2017, the U.S. Bankruptcy Court for the District of Delaware will start making audio recordings of certain proceedings available to the public through PACER, as well as the standard ECF notifications received by counsel.  The recordings themselves will be an attachment to a PDF document, and will be in MP3 format. Initially it will only be for proceedings before Judge Kevin J. Carey, although it may expand to other Judges in the future.  Click here for the notification posted... More
  • Liquidation Trustee’s Suit Against D&Os Falls Within Insured vs. Insured Exclusion In the recent decision of Indian Harbor Ins. Co. v. Zucker, 860 F.3d 373 (6th Cir. 2017), the Sixth Circuit Court of Appeals held that a liquidation trustee’s suit against the debtor’s former directors and officers (D&Os) falls within the “insured-versus-insured” exclusion in the debtor’s liability insurance policy. The liquidation trustee sued the D&Os for $18.8 million, alleging breach of fiduciary duties.  The insurance company filed a suit for a declaratory judgment that it had no obligation to cover any damages from... More