Justia Civil Procedure Opinion Summaries

This case arose out of a 2013, hit-and-run investigation that escalated into an officer-involved shooting. Michael Rogers appealed a superior court order granting summary judgment in favor of Defendants Corporal Matthew Morgan, the State of Delaware, and the Department of Public Safety Division of State Police. Corporal Morgan responded to a hit-and-run call and ran the license plate of the offending vehicle, which belonged to Michael. Corporal Morgan traveled to Michael’s home, where Michael’s elderly mother, Lorraine Rogers, answered the door. Ms. Rogers, who lived with her son, invited Corporal Morgan into the home as she went to wake Rogers, who was heavily inebriated and asleep in his bedroom. When Rogers refused to step outside to investigate damage to his vehicle, Corporal Morgan gripped Rogers' arm to lead him outside. Rogers immediately began fighting Corporal Morgan, who ended the fight by shooting Rogers. The State then charged Rogers with resisting arrest and several counts of assault. At the first criminal trial, Rogers filed a motion to suppress evidence resulting from Corporal Morgan’s entrance into the home, which Michael claimed was a warrantless search without valid consent. The court denied Roger's motion to suppress, finding his mother invited the Corporal into the home, and neither Rogers nor his mother revoked consent. The jury was unable to reach a verdict, resulting in a mistrial. The State re-indicted Rogers for assault and resisting arrest; Rogers pled nolo contendere to resisting arrest charge, and the State dropped the assault charges. Rogers' plea resulted in his conviction for one count of resisting arrest with force or violence, for which he was sentenced to jail time followed by probation. Michael filed this civil action in Superior Court alleging federal and state invasion of privacy claims, among other counts. Corporal Morgan moved for summary judgment on the grounds that collateral estoppel barred Michael’s invasion of privacy claims, since the judge in the criminal trial had found that Corporal Morgan had permission to be in the home when the altercation ensued. The superior court agreed with the Corporal and granted summary judgment. Finding no reversible error in the superior court's judgment, the Delaware Supreme Court affirmed. View "Rogers v. Morgan, et al." on Justia Law

Stockholder-plaintiff KT4 Partners LLC appealed the Court of Chancery’s post-trial order granting in part and denying in part KT4’s request to inspect various books and records of appellee Palantir Technologies Inc., a privately held technology company. The Court of Chancery found that KT4 had shown a proper purpose of investigating suspected wrongdoing in three areas: (1) “Palantir’s serial failures to hold annual stockholder meetings”; (2) Palantir’s amendments of its Investors’ Rights Agreement in a way that “eviscerated KT4’s (and other similarly situated stockholders’) contractual information rights after KT4 sought to exercise those rights”; and (3) Palantir’s potential violation of two stockholder agreements by failing to give stockholders notice and the opportunity to exercise their rights of first refusal, co-sale rights, and rights of first offer as to certain stock transactions. The Court ordered Palantir to produce the company’s stock ledger, its list of stockholders, information about the company’s directors and officers, year-end audited financial statements, books and records relating to annual stockholder meetings, books and records relating to any cofounder's sales of Palantir stock. The Court otherwise denied KT4's requests, including a request to inspect emails related to Investors' Rights Agreement amendments. Both sides appealed, but the Delaware Supreme Court was satisfied the Court of Chancery did not abuse its discretion with respect to all but two issues: (1) denying wholesale requests to inspect email relating to the Investors' Rights Agreement; (2) and requests to temper the jurisdictional use restriction imposed by the court. "Given that the court found a credible basis to investigate potential wrongdoing related to the violation of contracts executed in California, governed by California law, and among parties living or based in California, the basis for limiting KT4’s use in litigation of the inspection materials to Delaware and specifically the Court of Chancery was tenuous in the first place, and the court lacked reasonable grounds for denying the limited modifications that KT4 requested." View "KT4 Partners LLC v. Palantir Technologies, Inc." on Justia Law

Homeland Insurance Company of New York appealed a superior court judgment entered against it in the amount of $13.5 million plus pre-judgment interest. The litigation that led to the judgment was initiated by CorVel Corporation, a Delaware company that operated a national Preferred Provider Organization (PPO) network. Homeland issued CorVel a claims-made errors and omissions liability policy with limits of $10 million and a policy period of October 31, 2005 to October 31, 2006. Thereafter, Homeland issued similar renewal policies. CorVel’s PPO network included agreements with medical providers in Louisiana. In late 2004 and early 2005, Louisiana medical providers began filing claims asserting that CorVel had improperly discounted medical payments without providing proper notice in violation of a Louisiana PPO statute. Litigation in Louisiana ultimately involved millions of dollars of claims against CorVel. In 2011, CorVel entered into a settlement of the litigation. As part of the settlement consideration, CorVel paid $9 million. In 2015, CorVel filed its complaint in this case, alleging that Homeland owed it damages and penalties under another Louisiana statute, La. R.S. 22:1973. CorVel alleged that Homeland knowingly misrepresented facts or policy provisions in a complaint that Homeland filed in a declaratory judgment action in Delaware in 2011. The alleged misrepresentation was an averment that CorVel had not timely reported the PPO claims in accordance with the policy’s requirements. The damages CorVel sought were the $9 million that it paid to settle the Louisiana litigation, penalties, attorneys’ fees, and pre-judgment interest. The Delaware superior court agreed with CorVel’s claim and awarded it $9 million in damages, $4.5 million in penalties, and pre-judgment interest. Homeland argued on appeal: (1) the allegation in its declaratory judgment complaint was a statement of a coverage position that could not give rise to a finding of bad faith under either Delaware or Louisiana law; (2) no causal connection existed between the allegation in the declaratory judgment complaint and CorVel’s decision to settle the PPO claims; and (3) the applicable statute of limitations barred CorVel’s claim. The Delaware Supreme Court concluded that the statute of limitations did bar CorVel’s claim and that the superior court erred by ruling that it did not. Because the statute of limitations barred CorVel’s claim, the Court did not address Homeland’s first two arguments. View "Homeland Insurance v. Corvel Corp" on Justia Law

Appellant CompoSecure, LLC. appealed a nearly $17 million Chancery Court judgment for past-due commissions, legal fees and expenses, pre-judgment interest, and contract damages arising out of a sales agreement with Appellee CardUX, LLC. On appeal, CompoSecure argued the Court of Chancery erred by holding: (1) the Sales Agreement was voidable, not void, under CompoSecure’s Amended and Restated Limited Liability Company Agreement; and (2) CompoSecure impliedly ratified the Sales Agreement. CardUX argued that, even if CompoSecure were correct, the Delaware Supreme Court should enforce the Sales Agreement based on a provision in the LLC Agreement that addresses reliance by third parties on certain company actions, or based upon quantum meruit. After review, the Supreme Court determined the trial court needed to determine whether the Sales Agreement was a “Restricted Activity” as that term was defined by the parties’ contract. The Supreme Court agreed with the Court of Chancery’s conclusions that: (1) the Related Party Provision (leaving aside the Restricted Activities Provision) rendered the Sales Agreement voidable, not void, and was therefore subject to equitable defenses; (2) the parties impliedly ratified the Sales Agreement under New Jersey law; and (3) the Third Party Reliance Provision did not save the Sales Agreement from a failure to comply with the Related Party or Restricted Activities Provisions. Accordingly, the Supreme Court affirmed in part, reversed in part and remanded for further proceedings. View "Composecure, L.L.C. v. Cardux, LLC, et al." on Justia Law

Licensed nurses may be disciplined if they engage in “unprofessional conduct.” The applicable Delaware statute did not define “unprofessional conduct,” so the Board of Nursing adopted a rule to flesh the term out. Two nurses who held supervisory roles at a correctional facility were disciplined by the Board under that rule after they participated in the retrieval of medication from a medical waste container for eventual administration to an inmate. The nurses appealed to the Superior Court, and the court set their discipline aside. The court read the Board’s rule to require not just proof that the nurses breached a nursing standard, but also proof that in doing so, they put the inmate or the public at risk. And in the court’s view, the State had not made that showing. Because the Board applied the correct standard and its decision was supported by substantial evidence, the Delaware Supreme Court affirmed its decision and reversed the Superior Court. View "Delaware Board of Nursing v. Francis" on Justia Law

Gene Daskin, a Greek citizen residing in Greece, appealed two Delaware Family Court decisions finding subject matter jurisdiction over his wife's divorce petition and finding service of process on him was sufficient without requiring that service be properly made under the Hague Service Convention. The wife was a dual citizen of the United States and Greece. She was born in Wilmington and resided with her mother at her mother’s Wilmington home prior to the parties’ marriage. They married in Wilmington in 1990, and from then until November 2015, resided together in Greece. The husband contends that the time the wife has spent in Delaware since 2015 is temporary and for limited purposes. He contends she was not a resident of Delaware for the six months preceding the filing of her divorce petition. In his affidavit, the husband states that the wife pays taxes in Greece, has a Greek social security number, has a Greek identity card and has accounts in Greek banks. He also states that the wife continues to maintain a private marketing business out of their home in Greece. The husband’s position was that she was a resident of Greece, not Delaware. After review of the district court record, the Delaware Supreme Court determined the Family Court erred by dismissing the husband's motion to dismiss for lack of subject matter jurisdiction: service of process was insufficient. The matter was remanded for the Family Court to vacate the divorce decree and for further proceedings. View "Daskin v. Knowles" on Justia Law

The Delaware Supreme Court granted review to an interlocutory appeal in a Family Court divorce proceeding. The wife, Gretchen Knowles, was a dual citizen of the United States and Greece. She was born in Wilmington and resided with her mother at her mother’s Wilmington home prior to the parties’ marriage. The respondent-husband, Gene Daskin, was a Greek citizen residing in Greece. The appeal came from the husband, raising two claims: (1) the Family Court erred in finding it had subject matter jurisdiction over the wife’s divorce petition because she was not a Delaware resident for six consecutive months prior to the filing of the petition; and (2) the Family Court erred in finding that service of process upon him was sufficient without requiring that service be properly made under the Hague Service Convention. After review, the Supreme Court vacated the judgment of the Family Court denying the husband’s motion to dismiss for lack of subject matter jurisdiction. The Court reversed the denial of the husband’s motion to dismiss for lack of personal jurisdiction due to insufficiency of service of process. This matter was remanded to the Family Court to vacate the divorce decree, the trial Judge’s order of November 1, 2017 and the Commissioner’s order of August 8, 2017, and for further proceedings. View "Daskin v. Knowles" on Justia Law

In March 2016, soon after The Fresh Market (the “Company”) announced plans to go private, the Company publicly filed certain required disclosures under the federal securities laws. Given that the transaction involved a tender offer, the required disclosures included a Solicitation/Recommendation Statement on Schedule 14D-9 which articulated the Board’s reasons for recommending that stockholders accept the tender offer from an entity controlled by private equity firm Apollo Global Management LLC (“Apollo”) for $28.5 in cash per share. Apollo publicly filed a Schedule TO, which included its own narrative of the background to the transaction. The 14D-9 incorporated Apollo’s Schedule TO by reference. After reading these disclosures, as the tender offer was still pending, plaintiff-stockholder Elizabeth Morrison suspected the Company’s directors had breached their fiduciary duties in the course of the sale process, and she sought Company books and records pursuant to Section 220 of the Delaware General Corporation Law. The Company denied her request, and the tender offer closed as scheduled on April 21 with 68.2% of outstanding shares validly tendered. This case calls into question the integrity of a stockholder vote purported to qualify for “cleansing” pursuant to Corwin v. KKR Fin. Holdings LLC, 125 A.3d 304 (Del. 2015). In reversing the Court of Chancery's judgment in favor of the Company, the Delaware Supreme Court held "'partial and elliptical disclosures' cannot facilitate the protection of the business judgment rule under the Corwin doctrine." View "Morrison, et al. v. Berry, et al." on Justia Law

In March 2016, soon after The Fresh Market (the “Company”) announced plans to go private, the Company publicly filed certain required disclosures under the federal securities laws. Given that the transaction involved a tender offer, the required disclosures included a Solicitation/Recommendation Statement on Schedule 14D-9 (together with amendments, the “14D-9”), which articulated the Board’s reasons for recommending that stockholders accept the tender offer—from an entity controlled by private equity firm Apollo Global Management LLC (“Apollo”). The 14D-9 incorporated certain required schedules by reference. After reading these disclosures, as the tender offer was still pending, stockholder-plaintiff Elizabeth Morrison suspected the Company’s directors had breached their fiduciary duties in the course of the sale process, and she sought Company books and records pursuant to Section 220 of the Delaware General Corporation Law. The Company denied her request, and the tender offer closed as scheduled. Litigation over the Section 220 demand ensued, and Plaintiff obtained several key documents, such as board minutes and a crucial e-mail from Ray Berry’s counsel to the Company’s lawyers. Plaintiff then filed this action, including a breach of fiduciary duty claim against all ten of the Company’s directors, including Ray Berry, and a claim for aiding and abetting the breach against Ray Berry’s son, Brett Berry, who did not serve on the Board. The thrust of Plaintiff’s breach of fiduciary duty claim was that Ray and Brett Berry teamed up with Apollo to buy The Fresh Market at a discount by deceiving the Board and inducing the directors to put the Company up for sale through a process that “allowed the Berrys and Apollo to maintain an improper bidding advantage” and “predictably emerge[] as the sole bidder for Fresh Market” at a price below fair value. Plaintiff also alleged the Board and the stockholders were misled into believing that Ray Berry would openmindedly consider partnering with any private equity firm willing to outbid Apollo, but, instead, “[t]he reality of the situation was that Ray Berry (a) had already formed the belief that Apollo was uniquely well situated to buy Fresh Market; (b) had already entered into an undisclosed agreement with Apollo; and (c) was incentivized not to create price competition for Apollo.” In moving to dismiss, Defendants argued that Corwin v. KKR Fin. Holdings LLC, 125 A.3d 304, 312 (Del. 2015) applied. The Court of Chancery stated that this matter “presents an exemplary case of the utility of th[e] ratification doctrine, as set forth in Corwin and [In re Volcano Corp. S’holder Litig., 143 A.3d 727 (Del. Ch. 2016)].” The Delaware Supreme Court disagreed, finding defendants did not show under Corwin, that the vote was fully informed. Thus, “the business judgment rule is not invoked.” The Supreme Court reversed the Court of Chancery’s decision and remanded for further proceedings. View "Morrison, et al. v. Berry, et al." on Justia Law

This was a “take-home” asbestos case in which an employee’s now-deceased wife sued the companies who supplied asbestos products to her husband’s employer. Her husband’s employer caused him to work with those products, and the asbestos in them came home on his clothes. The wife’s theory of recovery against the asbestos product manufacturers was under section 388 of the Restatement (Second) of Torts, an asbestos product manufacturer has a duty to warn foreseeable users of the dangers of its products, to the extent the asbestos product manufacturer has actual or constructive knowledge of that danger, and when it is unlikely that the user will discover the dangerous condition.2 The legal question underlying this appeal reduced to whether the spouse of an employee harmed by take-home asbestos exposure could sue an asbestos product manufacturer and recover if it failed to provide warnings and safe laundering instructions to her spouse’s employer, so he could protect himself or whoever laundered his clothes. "When applying section 388, the mundane realities of life make the spouses of employees who launder asbestos-covered clothes foreseeable plaintiffs to whom the manufacturers can be held liable. Taking into account, though, the argument that the asbestos product manufacturers are not in a position to warn employees directly, much less the other people who might launder employees’ clothes," the Delaware Supreme Court reversed the grant of summary judgment in favor of the defendant-manufacturers. "If, as the Manufacturers suggest, claims from plaintiffs with more momentary exposure to and tenuous relationship to an exposed employee are filed in the future, the answer is to address those cases then in a reasoned way that takes into account the practicalities that must inform our common law. But, the answer is not to ignore the equity due to the plaintiff before us, and the plaintiffs like her, who base their claims on a clearly foreseeable consequence of common, and necessary, human conduct: workers often have family members who launder their work clothes, and if those work clothes are covered in asbestos dust, those family members can suffer serious injury and even death." View "Ramsey v. Georgia Southern University Advanced Development Ctr" on Justia Law