Justia Contracts Opinion Summaries

Plaintiff loaned funds to Defendant. As part of their credit arrangement, Plaintiff acquired the right to purchase fifteen telecommunications towers from Defendant, either within a specific period or otherwise in the event of default. Plaintiff and Defendant also agreed that Plaintiff, in its discretion, could lend additional funds that would help Defendant acquire or develop more towers. Plaintiff, however, decided not to lend Defendant any more funds and instead elected to purchase the fifteen towers from Defendant. Defendant, believing Plaintiff had failed to satisfy a commitment to lend Defendant more funds, sued. The superior court ruled in favor of Plaintiff, and the Supreme Court affirmed. Plaintiff then sought a declaratory judgment for specific performance of its claimed contractual right to acquire the towers from Defendant. The Court of Chancery ruled in favor of Plaintiff, holding that neither mutual or unilateral mistake allowed for reformation of the contract, and because a valid contract existed and the balance of the equities tipped in Plaintiff's favor, Plaintiff's request for specific performance was granted. View "CC Fin. LLC v. Wireless Props., LLC" on Justia Law

This action arose from a bidding dispute between Bidder and Owner over a contract to install rubber flooring for a renovation project. Bidder filed a complaint against Owner, alleging that the biding specifications were ambiguous, the bidding process was unfair, and that Owner improperly imposed a sole source specification in violation of law. Bidder also sought recovery of attorneys' fees incurred in bringing this action. Later, Owner withdrew the solicitation, rendering Bidder's complaint moot. The parties subsequently filed cross-motions for summary judgment on Bidder's request for attorneys' fees. The Court of Chancery granted Owner's motion for summary judgment, holding that Bidder failed to demonstrate that Owner's conduct warranted an award of attorneys' fees and expenses. View "Marra v. Brandywine Sch. Dist." on Justia Law

After a dispute resulting in a call for the resignation of several members of the Hockessin Community Center's board of directors, the Center filed a complaint seeking a determination of the lawful board of the Center. The complaint also sought damages and equitable relief under theories of breach of contract, breach of fiduciary duty, and secondary liability, based on Defendants' status as directors. The Court of Chancery named the lawful members of the board and the board president in its opinion, concluding (1) the disputed directors did not disqualify themselves and cease to be directors by failing to attend three board meetings in a row; (2) the disputed directors were not validly removed pursuant to a director-removal right in an agreement; (3) several of the defendant directors did not resign from the board; (4) although the Center failed to follow corporate formalities when adding certain directors, the directors validly served on the board as de facto directors; (5) a resolution adding five other non-defendants to the board was invalid; and (6) the actions taken at meetings at which the disputed directors reconstituted the board were partially valid. View "Hockessin Cmty. Ctr., Inc. v. Swift " on Justia Law

Plaintiff entered into a lease with Defendant containing optional renewal terms. The parties disputed whether the option was properly exercised. Defendant then informed Plaintiff that if it failed to vacate the leasehold, Defendant would pursue legal action. Plaintiff brought this action to forestall that eventuality. At issue in this case was whether the Court of Chancery can exercise jurisdiction over what is essentially a real estate possession action, notwithstanding that the Legislature has vested exclusive jurisdiction over such matters with the Justice of the Peace Courts. The Court of Chancery granted Defendant's motion to dismiss, concluding (1) the Court does not have jurisdiction, under the facts of this case, to enjoin Defendant from seeking relief from the Justice of the Peace Court in this matter where that court has exclusive jurisdiction; and (2) a claim does not exist in equity to nullify Defendant's contractual rights arising from Plaintiffs' purported failure to timely exercise an option. View "Heartland Del. Inc. v. Rehoboth Mall Ltd. P'ship" on Justia Law

Defendants presented themselves as president and vice president of ESG, Inc. in order to purchase assets from the predecessor of Plaintiff, Envo, Inc. Unfortunately, after the assets had been transferred, Defendants learned that ESG did not exist. Defendants kept the assets, however, and used them to run a business under the name Environmental Solutions Group, Inc. Defendants subsequently refused to pay Envo for the assets. Envo filed this claim under the doctrine of promissory estoppel and other legal and equitable doctrines, claiming it was damaged by Defendants' action. The Chancery Court found (1) Defendants and Environmental Solutions Group were liable to Envo under the doctrine of promissory estoppel; and (2) Envo was entitled to damages in an amount equal to the purchase price of the assets, plus pre-judgment interest, post-judgment interest, and costs. View "Envo, Inc. v. Walters" on Justia Law

This action arose from a technology-sharing relationship between companies engaged in the manufacture of industrial "sand-core" pipe for water and sewer applications. In 2002, the parties entered into an agreement whereby Plaintiffs agreed to provide Defendant with their technology for more efficient manufacturing sand-core pipe in exchange for data, reports, software, and other information developed by Defendant through use of Plaintiffs' process. Over time, the relationship between the parties disintegrated. As a result, in 2009, Plaintiffs brought this action asserting breach of contract and other causes of action related to Defendant's alleged nonperformance under their agreement. The Chancery Court dismissed Plaintiffs' claims for breach of contract, as well as claims under California Uniform Trade Secrets Act and for common law misappropriation, finding the claims were barred by laches. View "Petroplast Petrofisa Plasticos S.A. v. Ameron Int'l Corp." on Justia Law

This action involved a dispute between certain members of two Delaware real estate holding companies, Defendant Companies and the Companies' manager, Rubin Schron. Plaintiffs, MICH and SEEVA Entites, originally brought an action against Schron and Schron-affiliated entities in New York (the MICH/SEEVA action) alleging breaches of fiduciary duty and of the Companies' operating agreements. In response, Schron filed an opposing action in New York against the MICH and SEEVA entities' majority owners and controllers, alleging breaches of fiduciary duty and legal malpractice. The New York court dismissed the MICH/SEEVA action, holding that the operating agreements required all claims against the Companies to be brought in Delaware. Plaintiffs then filed this action, which Schron moved to stay or dismiss. The Chancery Court granted Defendants' motion to stay this action in favor of Schron's first-filed New York action. Plaintiffs then filed combined motions for reconsideration and certification of an interlocutory appeal. The Chancery Court held that, with the exception of Plaintiffs' claim regarding Defendants' withholding of certain distributions allegedly owed to Plaintiffs, Plaintiffs' motion should be denied because Plaintiffs did not demonstrate that relief was warranted. View "MICH II Holdings LLC v. Schron" on Justia Law

Central Mortgage and Morgan Stanley entered into a contract concerning the purchase of servicing rights for loans that Morgan Stanley planned to sell to Fannie Mae and Freddie Mac (the agencies) and private investors. Subsequently, many of the loans for which Morgan Stanley sold the servicing rights began to fall delinquent. The agencies exercised their contract right to put delinquent agency loans back to Central Mortgage. Central Mortgage then filed a complaint against Morgan Stanley for breach of contract. The Chancery Court granted Morgan Stanley's motion to dismiss. The Supreme Court reversed and remanded, holding that the claims were legally sufficient to withstand the motion. Central Mortgage then filed an amended complaint to add new claims for additional agency loans (new loans) that had been put back by the agencies and to challenge the private loans. Morgan Stanley moved to dismiss the amended complaint. The Chancery Court (1) denied the motion to dismiss to the extent that it rehashed theories that the Court and Supreme Court already considered in the context of its original motion to dismiss; but (2) granted the motion to dismiss the claims related to the new loans because those claims were barred by Delaware's statute of limitations. View "Central Mortgage Co. v. Morgan Stanley Mortgage Capital Holdings LLC" on Justia Law

GRT and Marathon are engaged in attempting to convert methane gas into fuel. They entered into interrelated agreements, including a Securities Purchase Agreement (Marathon purchased $25 million of GRT’s stock), mutual licensing agreements, and a Cooperative Development Agreement, governing collaboration to develop gas-to-fuels technology. Marathon built a multi-million dollar “Demonstration Facility” to test the technology on a large scale and a smaller research facility (Pilot Unit). Under the Development Agreement, GRT obtained access the Demonstration Facility and the ability to modify the Facility, to expire on December 31, 2012. The Facility began operations in 2008. Marathon executed a run campaign and shared data with GRT. In November 2009, Marathon decided to permanently close the Facility because of operational difficulties. Marathon followed procedures prescribed by the Agreement, gave notice, and extended GRT the right to acquire the Facility. GRT did not exercise that right. Although the Facility is currently closed, the Pilot Unit is operational, and both parties continue to test there. GRT claimed breach of contract. The chancellor found that the Development Agreement is not ambiguous and does not impose an affirmative duty on Marathon to operate the Facility through December, 2012, but provides GRT protection in other ways that would be internally inconsistent with such an affirmative duty.

NuVasive alleges that Lanx improperly persuaded NuVasive employees and a NuVasive consultant to leave NuVasive and work for Lanx instead, in breach of agreements that the employees had with NuVasive, to misappropriate NuVasive’s trade secrets and other proprietary information. Both are medical corporations. NuVasive claimed unfair competition, tortious interference with contractual relations, tortious interference with prospective contractual relations, aiding and abetting breach of fiduciary duty, civil conspiracy, and misappropriation of trade secrets. Lanx argued that the former NuVasive employees were necessary and indispensable parties to the action because NuVasive’s claims are predicated upon their acts. The chancellor declined to dismiss. While the former employees’ interests are not adequately protected by Lanx, the chancellor reasoned that a remedy could be crafted to avoid prejudice to their interests. The former employees were not indispensable to the misappropriation claim.