LexisNexis® Legal Newsroom
Tough Week for Fee-Seeking and "Fast Filer" Plaintiffs' Lawyers

Our legal system is one of our society's crowning achievements. But for all of its grandeur, our legal system is not without its flaws. Among other things, our system encourages litigiousness that all too often involves frivolous suits and lawyers'-fee driven litigation, including the recent...

Delaware Court of Chancery Imposes Fees for Bad Faith Litigation Tactics

ASB Allegiance Real Estate Fund v. Scion Breckenridge Managing Member LLC, C.A. No. 5483-VCL (Del. Ch. Sept. 16, 2013) [ an enhanced version of this opinion is available to lexis.com subscribers ] This Chancery decision, on remand from the Delaware Supreme Court, awarded attorneys’ fees based...

Delaware Supreme Court Upholds Fee-Shifting Provision in Bylaws

ATP Tour, Inc. v. Deutscher Tennis Bund , Del. Supr., No. 534, 2013 (May 8, 2014) [ an enhanced version of this opinion is available to lexis.com subscribers ]. Momentous Issue Addressed : The Delaware Supreme Court decided certified questions of law for the District of Delaware regarding whether...

The Latest on Arbitration Clauses in Corporate Bylaw Provisions

In a recent post , I noted the Delaware Supreme Court’s ruling upholding the validity of bylaw provisions shifting the costs of litigation to an unsuccessful intra-corporate litigation claimant, which is the latest in a series of judicial decisions in which courts have recognized the authority...

Proposed Addition to Delaware Corporate Statute Regarding Fee Provisions in Bylaws

A proposed new addition as well as related amendments to the Delaware General Corporation Law would limit the impact of a recent Delaware Supreme Court decision in ATP Tours, Inc. v. Deutscher Tennis Bund (No. 534, 2013, May 8, 2014), highlighted on these pages [ an enhanced version of this opinion is...

Delaware Legislative Revision Proposed to Restrict Fee-Shifting Bylaws Introduced

As discussed in a recent post ( here ), in a May 8, 2014 decision the Delaware Supreme Court upheld the facially validity of a nonstock corporation’s bylaw provision shifting attorneys’ fees and costs to unsuccessful plaintiffs in intra-corporate litigation. Because the court’s holding...

Delaware Corporate Bylaws: Even If the Company Can’t Fee Shift, It Can Still Forum Select

In light of the recent legislative initiative to restrict Delaware stock corporations’ use of fee-shifting bylaws, companies incorporated in Delaware have, as described in a recent Law 360 article ( here , subscription required) a “smaller more defined toolbox” to reduce the burdens...

Supreme Court Disallows Award of Fees in the Absence of Final Judgment

Crothall v. Adhezion Biomedical, LLC , C.A. No. 608, 2013 (Del. Ch. June 9, 2014) [ an enhanced version of this opinion is available to lexis.com subscribers ]. This Delaware Supreme Court decision features a rare reversal of the Court of Chancery, and determined that the award of attorneys’...

Corporate Benefit Doctrine Not Applicable to Volunteers

Raul v. Astoria Financial Corporation , C.A. No. 9169-VCG (Del. Ch. June 20, 2014) [ an enhanced version of this opinion is available to lexis.com subscribers ]. Issue Addressed : Whether attorneys’ fees were appropriate under the corporate benefit doctrine when the court considered the benefit...

Though Delaware Legislature Has Tabled Action, Upcoming Judicial Review of Fee-Shifting Bylaws Seems Likely

The Delaware Supreme Court stirred up quite a bit of controversy earlier this year in the ATP Tours, Inc. v. Deutscher Tennis Bund case when it upheld the facial validity of a fee-shirting by law [an enhanced version of this opinion is available to lexis.com subscribers] . The bylaw provided that an...

Delaware Court of Chancery Awards Fees Based on Corporate Benefit Doctrine

Sutherland v. Sutherland , C.A. No. 2399 -VCN (Del Ch. July 31, 2014). This Delaware Court of Chancery decision involving a long-running internecine legal battle among family members who own and manage related corporations, is noteworthy because it applies the corporate benefit doctrine to a series...

Delaware Court of Chancery Hears Fee-Shifting Bylaws Argument

After the Delaware Supreme Court decision in ATP Tour, Inc. v. Deutscher Tennis Bund , Del. Supr., No. 534, 2013 (May 8, 2014) [an enhanced version of this opinion is available to lexis.com subscribers] , highlighted on these pages, in which the court upheld fee-shifting bylaws, a number of companies...

Delaware Court of Chancery Addresses Advancement and Indemnification of Corporate Officer

In Pontone v. Milso Industries Corp . , C.A. No. 8842-VCP (Del. Ch. Aug. 22, 2014), the Delaware Court of Chancery addressed the rights to advancement and indemnification of attorneys’s fees for a corporate officer pursuant to both DGCL Section 145 and applicable agreements among the parties [an...

One Superior Court Judge Overruling Another?

You are all familiar with the old adage that "one Superior Court Judge cannot overrule another Superior Court Judge." But apparently there is at least a little bend in that rule, as illustrated by Judge Bledsoe's opinion this past Thursday, in Taidoc Technology Corp. v. OK Biotech Co. ...

Contract-Based Award of Attorneys’ Fees

ReCor Medical, Inc. v. Warnking , C.A. No. 7387-VCN (Del. Ch. May 14, 2014) [ an enhanced version of this opinion is available to lexis.com subscribers ]. This letter opinion provides a helpful analysis of how the Court of Chancery awards attorneys’ fees based on a contract that provides for...

The NC Business Court Rules on Recovering Attorneys' Fees in a Derivative Action Against an LLC

In this week's opinion in Ekren v. K&E Real Estate Investments , 2014 NCBC 56 , Judge Bledsoe outlined how a derivative action plaintiff can recover attorneys' fees [ an enhanced version of this opinion is available to lexis.com subscribers ]. What Constitutes A 'Substantial Benefit"...

Delaware Court of Chancery Addresses Attorney’s Charging Lien

Zutrau v. Jansing and ICE Systems, Inc ., C.A. No. 7457-VCP (Dec. 8, 2014) [ an enhanced version of this opinion is available to lexis.com subscribers ]. This blog post should be of interest to lawyers who want to be paid for their services. Even if the court harshly rejects a good faith argument...

One Plaintiff, Dozens of Merger Objection Lawsuits, Millions in Attorneys’ Fees, Zero for Shareholders

It is now well-established that pretty much every M&A deal attracts at least one lawsuit from a shareholder objecting to the transaction. According to research by Notre Dame business professor Matthew Cain and Ohio State law professor Steven Davidoff, 97.3% of all takeovers in 2013 with a value of...

Delaware Court of Chancery Awards Fees for Unfair Process Despite Finding of Fair Price

In Re Nine Systems Corporation Shareholders Litigation, Cons. C.A. No. 3940-VCN (Del. Ch. May 7, 2015) [ an enhanced version of this opinion is available to lexis.com subscribers ]. This Delaware Court of Chancery decision on the award of attorneys’ fees is blogworthy in that the basis of the...

Delaware Court of Chancery Awards $72 Million in Fees for Settlement of Class and Derivative Suit

In Re Activision Blizzard, Inc. Stockholder Litigation , Cons. C.A. No. 8885-VCL (Del. Ch. May 20, 2015) [ an enhanced version of this opinion is available to lexis.com subscribers ]. This Delaware Court of Chancery opinion refers to the settlement of $275 million in this case as the largest derivative...

Delaware Court of Chancery Awards Fees Based on “Gross Value of Settlement”

In re Jefferies Group, Inc. Shareholders Litigation , Cons. C.A. No. 8059-CB (Del. Ch. June 5, 2015) [ an enhanced version of this opinion is available to lexis.com subscribers ]. This Delaware Court of Chancery letter ruling describes the standards that apply to a request for attorneys’ fees...

When You Wish Upon a (Lode)Star: NC Business Court Cuts Fees Requested by Attorneys for Class Plaintiffs

The Business Court last week knocked down a fee request of Plaintiffs' class action counsel to $500,000, from the $660,000 requested, in an Order in Nakatsukasa v. Furiex Pharmaceuticals, Inc. , 2015 NCBC 68 [subscribers can access an enhanced version of this opinion: lexis.com | Lexis Advance ]...

Cal. Supreme Court: Insurer May Seek to Recover Directly From Independent Counsel Allegedly Excessive or Unreasonable Fees

On August 10, 2015, in an opinion that has already garnered a great deal of attention and commentary, the California Supreme Court ruled that an insurer that funded the payment for its insured of independent counsel (or “Cumis” counsel as independent counsel are known in California) in defense...

Delaware Court of Chancery to Be Less Likely to Approve Fees in Disclosure Only Cases

In re Riverbed Technology, Inc., Stockholders Litigation , Cons. C.A. No. 10484-VCG (Del. Ch. Sept. 17, 2015) [subscribers can access an enhanced version of this opinion: lexis.com | Lexis Advance ]. This Delaware Court of Chancery opinion is noteworthy because it provides notice to corporate litigators...

NC Court of Appeals Affirms Business Court Award of $1 Million in Fees to Class Counsel

It seems like forever ago that the then venerable North Carolina institution, Wachovia Bank, failed and was acquired by Wells Fargo. (This was actually seven years ago). But just last week came what might be the final closure in the battle by the lawyers representing the class which challenged that acquisition...