In a rare decision pertaining to Section 205 of the DGCL handed down today by the Delaware Court of Chancery, Applied Energetics, Inc. v. Farley, et al., C.A. No. 2018-0489-JTL (Del. Ch. Aug. 3, 2020), Vice Chancellor Laster granted summary judgment in favor of a plaintiff who challenged a defective board action, as result of failing to meet the quorum requirement under the corporation’s bylaws.  However, the Court also ruled that such defective act…

It is well established that when a stockholder of a Delaware corporation makes a books and records demand under Section 220 of the DGCL, the stockholder must state a proper purpose for the requested books and records.  “Valuation of a stockholder’s investment in a corporation, particularly where the corporation is privately held, has long been recognized as a proper purpose under 8 Del. C. § 220.” Thomas & Betts Corp. v. Leviton Mfg. Co.,…

The recent decision of SolarReserve CSP Holdings, LLC v. Tonopah Solar Energy, LLC, C.A. No. 2020-0064-JRS (Del. Ch. July 24, 2020), handed down by the Delaware Court of Chancery, is an important read for any litigant involved in a books and records demand, where the party seeking information has assigned its interests in the company to a non-party.  Of significance to this action, the Court had previously denied equitable relief by the plaintiff on…

In light of the ongoing coronavirus pandemic, the Delaware bar exam has been cancelled this year, according to an announcement by the Court issued on July 24, 2020.  The bar examination, usually scheduled in late July, had previously been rescheduled to September 9th to 11th. Pursuant to the announcement, in lieu of the bar exam, Delaware’s Board of Bar Examiners is “working with the Supreme Court to implement a temporary limited practice rule that will…

Earlier in June 2020, the Delaware Court of Chancery has issued its Courtroom Protocols, that are being implemented, effective June 8, 2020, in conjunction with the reopening of the courthouses.  A high-level summary of the new practices and procedures are set forth below: All attorneys and members of the public will be screened upon entering a State courthouse in accordance with the protocols set forth in the Reopening Plan. The Reopening Plan requires 6…

Section 273 of the Delaware General Corporation Law (the “DGCL”) provides a basis for the dissolution of a deadlocked “joint venture” corporation, in which two equal shareholders cannot agree on whether to discontinue the corporation.  However, the Delaware Limited Liability Act (“LLC Act”) does not have a provision similar to 8 Del. C. § 273 providing for the dissolution of a deadlocked LLC.  Nor does the Delaware Revised Uniform Limited Partnership Act. Notably, when a 50/50…