Showing 17 posts in Statute of Limitations. Show
Chancery Dismisses Time-Barred Complaint Against ZillowPosted In Chancery, Statute of Limitations
Share Chancery Confirms Operation of Savings Statute and Tortious Interference Framework in Dispute Involving Fiduciaries with Competing Creditor Interests
Share Chancery Addresses Statutes of Limitations Issues Arising Out Employment-Related ClaimsPosted In Chancery, Statute of Limitations Weik, Nitsche & Dougherty, LLC, v. Pratcher, C.A. No. 2018-0803-MTZ (Del. Ch. Aug. 26, 2020) Following an employment dispute between former employers and employees of a Delaware limited liability company, the employers (“Plaintiffs”) filed an action in the Delaware Court of Chancery seeking rescission of a contract recently executed by the parties. The contract at issue governed the percentage of fees to which the employees (“Defendants”) were entitled for any business the employees originated for the LLC. According to Plaintiffs, Defendants breached the contract by engaging in “self-marketing campaigns” through which Defendants failed to recognize any affiliation with the LLC and which caused a disparity in the amount of fees each party believed Defendants were entitled to. In a series of counterclaims, Defendants argued that Plaintiffs owed Defendants certain sums of money pursuant to the contractual relationship. Defendants asserted that Plaintiffs owed those sums based on the Defendants’ “expectancy in the contracts” which were lost after Plaintiffs purportedly breached the contract and forced Defendants to “resign and lose their expected profits from [the contract].” More › Share CCLD Offers Guidance on the Application of Tolling Doctrines to M&A Agreement Clauses Modifying the Statute of Limitations for Representations and Warranties ClaimsPosted In CCLD, M&A, Statute of Limitations AssuredPartners of Virginia, LLC v. Sheehan, C.A. No. N19C-02-175 AML CCLD (Del. Super. Ct. May 29, 2020) A disgruntled buyer brought suit against its seller for breaches of representations and warranties four years after the execution of the applicable asset purchase agreement (“APA”). The APA contained a clause providing that certain representations and warranties survived for two (2) years post-closing except for those fraudulently given, which survived from closing until sixty days after expiration of the applicable statute of limitations. The defendant-sellers sought dismissal of the breach claims as untimely, requiring Judge Abigail M. LeGrow of the Superior Court of Delaware to determine whether the doctrine of tolling applied to the APA’s survival clause and if the parties intended to contractually extend the statute of limitations for fraudulent representation claims under 10 Del. C. § 8106(c). More › Share Chancery Applies Borrowing Statute, Dismisses Plaintiff’s Fraud Claims as Time-BarredPosted In Laches, Statute of Limitations CHC Investments, LLC v. FirstSun Capital Bancorp, C.A. No. 2018-0353-KSJM, (Del. Ch. Mar. 23, 2020). On a motion to dismiss plaintiff’s claims for fraud, the Delaware Court of Chancery applied Delaware’s three-year statutory limitations period rather than Texas’s four-year period and dismissed plaintiff’s claims as time-barred. Narrowly interpreting the Delaware Supreme Court’s holding in Saudi Basic Indus. Corp. v. Mobil Yanbu Petrochemical Co., 866 A.2d 1, 16-18 (Del. 2005), the Court found that, except in circumstances where a party is forced to bring claims in Delaware, under Delaware’s “borrowing statute,” the shorter of Delaware’s statute of limitations and that of the foreign jurisdiction will apply. More › Share CCLD Finds that Statute of Limitations for Tortious Interference Claim was Tolled until Key Documents Relating to the Alleged Scheme were ReleasedPosted In Statute of Limitations BTIG, LLC v. Palantir Technologies, Inc., C.A. No. N19C-08-314 EMD CCLD (Del. Sup. Ct. Jan. 3, 2020). In this decision denying a motion to dismiss, the Superior Court’s Complex Commercial Litigation Division found that the plaintiff sufficiently alleged facts to toll the statute of limitations under the “time of discovery” rule, which is also known as the doctrine of “inherently unknowable injury.” More › Share Delaware Superior Court CCLD Clarifies When a Plaintiff is on Inquiry Notice to Bring a Claim for Limitations Period PurposesPosted In Statute of Limitations, Superior Court Ocimum Biosolutions (India) Ltd. v. AstraZeneca UK Ltd., C.A. No. N15C-08-168 AML CCLD (Del. Super. Dec. 10, 2019). Even in circumstances where a statutory limitations period can be tolled, tolling typically will cease once a plaintiff may be charged with inquiry notice of its potential claims. In this dispute brought against the biopharmaceutical company AstraZeneca arising out of database subscription arrangement, the Complex Commercial Litigation Division of the Delaware Superior Court held that defendant AstraZeneca was entitled to summary judgment because the plaintiff Ocimum Biosolutions had inquiry notice of its claims for breach of contract and misappropriation of trade secrets more than three years before commencing suit. More › Share Decade-long Failure to Pursue Claim for Founder’s Shares Results in Laches DismissalPosted In Statute of Limitations Forman v. CentrifyHealth, Inc., C.A. No. 2018-0287-JRS (Del. Ch. Apr. 25, 2019) As the Court of Chancery observes in this opinion, “equity favors the vigilant, not those who slumber on their rights.” Here, the Court applies the equitable doctrine of “laches” to dismiss claims brought beyond the statute of limitations at law, at which point prejudice to the defendant is presumed. The plaintiff, a former director, brought suit in 2017 claiming that in 2005, he was promised but never received certain founder’s shares, and later, under a 2006 stock option plan, he was promised additional shares. Although the Court of Chancery recognized that a laches defense is fact intensive, the Court determined that it was clear from the face of the complaint that the plaintiff was aware by 2007 that the company denied his claim to any founder’s shares, including because he was provided capitalization tables not reflecting any such shares. More › Share Court of Chancery Explains Interplay of Laches Defense, the Statute of Limitations and “Extraordinary Circumstances” Excusing Late FilingsPosted In Statute of Limitations Winklevoss Capital Fund, LLC v. Shaw, C.A. No. 2018-0398-JRS (Del. Ch. Mar. 1, 2019) As this decision explains, the Court of Chancery will apply the equitable doctrine of laches (untimeliness) at the pleadings stage to dismiss a claim when it is clear on a claim’s face that it is untimely and equity would not be offended by dismissing it. This is especially true where the claims at issue are common law claims for common law remedies, but were filed after the statute of limitations provided by law. The decision also explains the burden to plead facts sufficient to toll the statute of limitations under Delaware law, as well as when “unusual conditions” or “extraordinary circumstances” might excuse late-filed claims, with discussion of the factors Delaware courts consider in making that assessment. Here, the claims found to be untimely were the defendants’ counterclaims. While the Court dismissed those claims, it also explained that Delaware law allowed defendants to rely on the underlying allegations in support of an affirmative defense to offset any damages award in the plaintiffs’ favor under the circumstances. Share Court of Chancery Explains Conspiracy Jurisdiction and Inquiry Notice RulesPosted In Jurisdiction, Statute of Limitations iBio v. Fraunhoffer Gesellschaft, C.A. No. 2017-0790-TMR (Del. Ch. Dec. 10, 2018) This decision has two helpful analyses. First, it addresses the conspiracy theory of jurisdiction under the well-known Instituto Bancario decision, which permits a Delaware court to exercise jurisdiction over a defendant based on the Delaware acts of its co-conspirators. Notably, the plaintiff in this case was a Delaware entity with its principal place of business in the State, providing a jurisdictional hook for that theory. Second, it explains when a plaintiff is on inquiry notice so as to end any tolling period and start the statute of limitations clock. Share Delaware Supreme Court Reverses Superior Court in Holding that Insured’s Claim Barred by the Statute of LimitationsPosted In Statute of Limitations Homeland Ins. Co. of New York v. CorVel Corp., No. 60, 2018 (Del. Nov. 20, 2018) CorVel filed a complaint in the Delaware Superior Court in May 2015 arising out of a settlement of the underlying actions in January 2011. The Supreme Court held that CorVel’s bad faith claim began to run in 2011, when CorVel settled an underlying arbitration and related class action. Because CorVel did not file suit until January 2011, the applicable three-year statute of limitations barred CorVel’s claim. The Supreme Court held that once CorVel could plead the necessary elements of a prima facia claim under Lousiana’s Bad Faith Statue, the cause of action accrued for purposes of Delaware’s statute of limitations. In doing so, the Supreme Court held that it was not necessary for CorVel to actually obtain a ruling that the Homeland policy covered the claims before it could proceed with its bad faith action. Share Delaware District Court Explains Tolling Based on Books and Records InspectionPosted In Books and Records, Statute of Limitations Norman v. Elkin, C.A. No. 06-005-LPS (D. Del. Sept. 4, 2018) Litigation seeking to inspect a corporation’s records under Section 220 of the DGCL might toll the statute of limitations for certain claims under the right circumstances. There are important limits to this form of tolling. For example, it is not automatic and will only apply to claims that are the subject of the inspection demand. This decision does a good job of explaining these limits and the factors a court will consider in determining whether inspection-based tolling should apply. It otherwise examines and applies the law on the statute of limitations and issues of inquiry notice. Share Delaware Superior Court Explains When Statute Of Limitations AccruesPosted In Statute of Limitations Black Diamond Hope House Inc. v. U&I Investments LLC, C.A. K15C-12-034 JJC (May 22, 2018) If a contract spells out when the time to sue under it starts to run, the time of discovery rule does not apply. Instead, the contract provision for accrual of a claim governs. Share Court Of Chancery Explains Limitations Period In EquityPosted In Breach of Contract, Statute of Limitations Bioveris Corporation v. Meso Scale Diagnostics, C.A. No. 8692-VCMR (Nov. 2, 2017) Some assume that a statute of limitations will not apply in the Court of Chancery. But as this decision illustrates, that is an oversimplification. The Court of Chancery may well use the same statute of limitations period applicable in an action at law, by analogy, under the equitable doctrine of laches. This is especially true when the claim is a legal one seeking legal relief. This decision also illustrates an important point regarding claim accrual. When a claim arises out of an obligation to make a series of payments over time, it is possible the Court will start to run the laches period from the first non-payment. In other words, subsequent non-payments might not constitute a new claim with a new limitations period or otherwise lengthen the time period to sue. Share Delaware Supreme Court Explains Setoff And RecoupmentPosted In Breach of Contract, Statute of Limitations Finger Lakes Capital Partners LLC v. Honeoye Lake Acquisition LLC, No. 42, 2016 (November 14, 2016) This decision explains the difference between a defendant’s right of setoff and recoupment. The key difference is that the right of setoff arises out of an independent transaction, while recoupment must be based on the same facts that support the main claim. Another difference concerns the statute of limitations. Setoff is subject to a three-year statute of limitations, while time-barred claims can be considered for recoupment when they arise out of the same factually-related transaction as the plaintiff’s claim. Share What are fiduciary duties under Delaware law?Directors of Delaware corporations are subject to the fiduciary duties of care and loyalty (which include the subsidiary duties of good faith, oversight and disclosure). - Duty of care. Care requires informed, deliberative deci- sion-making based on all material information reasonably available.
Is breach of fiduciary duty a tort in Delaware?This includes a breach of fiduciary duty claim, which Delaware law considers an equitable tort.
Is there a triad of fiduciary duties under Delaware corporate law?v. Technicolor, Inc.,[37] the Delaware Supreme Court articulated good faith as one of a "triad" of fiduciary duties, the others being due care and loyalty.
Does Delaware allow the elimination of the fiduciary duty of care?The Delaware Limited Liability Company Act allows for the fiduciary duties of a member to be expanded, restricted, or eliminated by provisions in the operating agreement of a limited liability company (“LLC”). If drafters intend to eliminate fiduciary duties, this intent must be plain and unambiguous.
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Delaware statute of limitations breach of fiduciary duty
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