IN THE SUPERIOR COURT OF THE STATE OF DELAWARE
CMD GLOBAL PARTNERS (USA), ) LLC, ) Plaintiff, ) ) v. ) C.A. No. N25C-10-326 FWW ) WESTERN ALLIANCE BANK, ) MTSELLER, INC. f/k/a MANTLE, ) INC., THEODORE SOROM, ) STEPHEN CONNOR, ALEXANDRA ) MANICK, SHYMAN ) KAMADOLLI; and DOES 1-10, ) ) Defendants. )
Submitted: April 9, 2026 Decided: June 5, 2026
Upon Defendant Western Alliance Bank’s Rule 12(b)(6)Motion to Dismiss Counts III, IV, V and VI of Plaintiff’s Amended Complaint DENIED in part and GRANTED in part.
Upon the Motion of Defendants Theodore Sorom and Stephen Connor to Dismiss Counts V, VI, and VII of the Amended Complaint Pursuant to Superior Court Rule 12(b)(6) DENIED in part and GRANTED in part.
Upon Defendants Alexandra Manick and Shyam Kamadolli’s Motion to Dismiss Counts V, VI, and VII of the Amended Complaint GRANTED.
ORDER Maria Aprile Sawczuk, Esquire, Aaron R. Harburg, Esquire, Ainsley G. Moloney, Esquire (pro hac vice) GOLDSTEIN & MCCLINTOCK, LLLP, 501 Silverside Road, Suite 65, Wilmington, DE 19809, attorneys for Plaintiff CMD Global Partners (USA), LLC.
Ronald N. Brown, III, Esquire, Caleb G. Johnson, Esquire, Isabelle Ord, Esquire (pro hac vice), Sam Bodle, Esquire (pro hac vice) DLA PIPER LLP (US), 1201 North Market Street, Suite 2100, Wilmington, DE 19801, attorneys for Defendant Western Alliance Bank.
R. Karl Hill, Esquire, William A. Hazeltine, Esquire, SULLIVAN NIMEROFF BROWN HILL LLC, 919 North Market Street, Suite 420, Wilmington, DE, attorneys for Defendants Theodore Sorom and Stephen Connor.
Catherine G. Dearlove, Esquire, Nicole M. Henry, Esquire, Daniel M. Boucot, Esquire, RICHARDS, LAYTON, & FINGER, P.A., 920 North King Street, Wilmington, DE 19801, Attorney for Defendants Alexandra Manick and Shyam Kamadolli.
WHARTON, J.
2 This 5th day of June 2026 upon consideration of: (1) Defendant
Western Alliance Bank’s (“Western Alliance”) Rule 12(b)(6) Motion to
Dismiss Counts III, IV, V and VI of Plaintiff’s Amended Complaint,1 CMD
Global Partners (USA), LLC’s (“CMD Global”) Response,2 Western
Alliance’s Reply;3 (2) the Motion of Defendants Theodore Sorom and Stephen
Connor (“Sorom and Connor”) to Dismiss Counts V, VI, and VII of the
Amended Complaint Pursuant to Superior Court Rule 12(b)(6),4 CDM
Global’s Answer,5 Sorom and Connor’s Reply;6 (3) the Motion of Defendant’s
Alexandra Manick and Shyman Kamadolli (Manick and Kamadolli”) to
Dismiss Counts V, VI, and VII of the Amended Complaint,7 CDM Global’s
Answer,8 Manick and Kamadolli’s Reply,9 and the record in this case, it
appears to the Court that:
1. On October 23, 2025, CMD Global filed a Complaint against
Western Alliance and Mantle, Inc.10 The Complaint was amended on
1 Def. Western Alliance’s Mot. to Dismiss (“MTD”), D.I. 28. 2 Pl.’s Resp. to Def. Western Alliance’s MTD, D.I. 37. 3 Def. Western Alliance’s Reply, D.I. 41. 4 Defs. Sorom and Connor’s MTD, D.I. 39. 5 Pl.’s Ans. to Sorom and Connor’s MTD, D.I. 56. 6 Defs. Sorom and Connor’s Reply, D.I. 61. 7 Defs. Manick and Kamadolli’s MTD, D.I. 50. 8 Pl.’s Ans. to Manick and Kamadolli’s MTD, D.I. 59. 9 Defs. Manick and Kamadolli’s Reply, D.I. 62. 10 Compl., D.I. 1. 3 November 5, 2025 to add the other defendants and allege additional claims.11
CMD Global’s Amended Complaint asserts claims against Western Alliance
for Tortious Interference with Contractual Relations (Count III),12 Tortious
Interference with Business Relations (Count IV),13 and Fraudulent Transfer
under the Delaware Uniform Fraudulent Transfer Act (“DUFTA”) (Counts V
and VI).14 CMD Global alleges that Western Alliance intentionally interfered
with CMD Global’s engagement and business relationships surrounding the
sale of Mantle, Inc.’s assets and orchestrated transfers of proceeds, cash, and
intellectual property-related value to prevent CMD Global from collecting its
earned fee.15 The Amended Complaint includes Defendants Sorom, Connor,
who were officers of Mantle, and Manick and Kamadolli, who were outside
directors, in Counts V and VI.16 It also brings a count for Quantum Meruit in
the alternative against “Defendants MTSELLERS, Inc. f/k/a Mantle, Inc. and
its directors and officers” (Count VII).17
11 Am. Compl., D.I. 34. 12 Id. at ¶¶ 123-29. 13 Id. at ¶¶ 130-37. 14 Id. at ¶¶ 138-51. 15 Id. at ¶¶ 123-137. 16 Id. at ¶¶ 138-51. 17 Id. at ¶¶ 152-58. 4 2. Western Alliance Bank extended a loan to Mantle in July 2024
(the “Loan”).18 In connection with the Loan, Western Alliance obtained a
first-priority security interest in Mantle’s assets other than Mantle’s
intellectual property.19
3. CMD Global and Mantle entered into an Engagement Letter
under which CMD Global would solicit offers and assist Mantle with strategic
alternatives.20 The Engagement Letter included a Mergers and Acquisitions
(“M&A”) transaction success fee in an amount of not less than $1,250,000 for
transactions valued at $25 million or less.21 CMD Global would earn this fee
if a transaction closed during the engagement or a 12‑month tail period.22
CMD Global alleges it fully performed its obligations, secured multiple
offers, and obtained a non-binding Indication of Interest from the Angstrom
Group — the best and highest bid ready and able to close.23
4. CMD Global alleges that Western Alliance, Mantle’s senior
lender, took control of Mantle’s cash and operations under a July 18, 2024
18 Id. at ¶ 35. 19 Id. at ¶ 36. 20 Id. at ¶¶ 19, 25. 21 Id. at ¶ 29. 22 Id. at ¶ 30. 23 Pl.’s Resp. to Def. Western Alliance’s MTD, at 4, D.I 37. 5 Loan and Security Agreement after learning of the Angstrom offer.24 Western
Alliance issued a default notice, and directed Mantle to grant Western
Alliance a security interest in previously excluded intellectual property (“IP
Assets”) in exchange for allowing Mantle to retain sufficient operating cash
and to effectuate an M&A transaction.25
5. CMD Global further alleges that on September 11, 2025, it
learned Western Alliance asked Sorom: “How can we circumvent CMD’s
fees?”26 Sorom then told CMD Global on September 24, 2025, that Western
Alliance had “veto power” and would require CMD Global to reduce its fee
or Western Alliance would pursue an Article 9 sale.27
6. On September 25, 2025, shortly after CMD Global secured a
revised Angstrom offer, Western Alliance directed Mantle to terminate the
Engagement Letter while acknowledging post‑termination obligations.28
CMD Global pleads that Western Alliance’s actions cut CMD Global off from
the process and communications with the Angstrom Sale.29 Mantle then
consummated a transaction with Angstrom around October 3, 2025, on terms
24 Am. Compl. at ¶¶ 35, 39, 40, D.I. 34. 25 Id. at ¶¶ 47-48. 26 Id. at ¶ 52. 27 Id. at ¶¶ 74-76. 28 Id. at ¶¶78-79. 29 Id. at ¶ 90. 6 near CMD Global’s revised offer, selling substantially all of Mantle’s assets
for approximately $3 million on a debt and cash free basis.30
7. According to the Amended Complaint, upon receipt of the
approximately $3 million in transaction proceeds and $2.4 million in cash
assets following the closing of the transaction, Western Alliance was repaid
more than the full amount or nearly the full amount of all outstanding
obligations under the Loan and Security Agreement.31 Western Alliance
directed Mantle to transfer, and Mantle transferred its IP Assets to Western
Alliance so that such assets would be out of the reach of CMD Global with
the actual intent to hinder, delay, or defraud it, according to CMD Global.32
8. CMD Global alleges that at or around the same time, Western
Alliance or Mantle’s officers and directors, separately or in combination
caused or directed the transfer of all of Mantle’s remaining cash and the
transaction proceeds to Western Alliance, rendering Mantle functionally
insolvent even though it was aware of CMD Global’s September 26, 2025
demand and threatened litigation.33
30 Id. at ¶ 90. 31 Id. at ¶ 96. 32 Id. at 97-98. 33 Id. at ¶¶ 91-96. 7 9. CMD Global initiated suit,34 later amending the Complaint to add
DUFTA claims and individual defendants, Sorom, Connor, Manick, and
Kamadolli.35 Now, all defendants, save MTSELLER, f/k/a Mantle, Inc.,
move to dismiss.
10. Western Alliance moves to dismiss, principally contending that:
(a) the Court may consider certain documents outside the complaint as
“integral”; (b) its conduct was justified as a senior secured lender enforcing a
valid, legally protected interest; (c) there was no actionable “transfer” under
DUFTA because Western Alliance’s lien was “valid” and exceeded the
transferred asset value; (d) CMD Global has not adequately pled actual
fraudulent intent or particularity. CMD Global’s answering brief opposes
dismissal and argues that the extrinsic documents proffered by Western
Alliance (an IP Security Agreement and Settlement Agreement) should not be
considered on Rule 12(b)(6).36
11. Sorom and Connor move to dismiss Counts V, VI, and VII. They
contend Count V should be dismissed for failure to state a claim because it
fails to allege that the repayment to Western Alliance was a transfer of an
34 See generally Compl., D.I. 1. 35 See generally Am. Compl., D.I. 34. 36 Pl.’s Resp. to Def. Western Alliance’s MTD at 12, 15, D.I. 37. 8 “asset” as defined by DUFTA.37 Since the property transferred was entirely
subject to a valid lien, it cannot be the subject of a fraudulent transfer.38 Count
VI, which seeks to recover the allegedly fraudulent transfers pursuant to
DUFTA, should be dismissed against them because as officers of Mantle, they
did not receive any of the transfers.39 Lastly, Count VII – the quantum meruit
claim - should be dismissed because Sorom and Connor, as officers of Mantle,
did not receive the benefit of any services provided to Mantle.40 CMD Global
opposes the motion. It argues that the Amended Complaint alleges sufficient
facts to support a fraudulent transfer claim in Count V,41 Count VI properly
pleads a claim for relief against Sorom and Connor as officers,42 and the
alternative claim for quantum meruit in Count VII is properly asserted.43
12. Lastly, directors Manick and Kamadolli move to dismiss Counts
V, VI, and VII. First, they argue the claims should be dismissed against them
for lack of personal jurisdiction and failure to properly effect service under 10
Del. C. § 3114 as directors of a Delaware corporation.44 Next, the fraudulent
37 Sorom and Connor’s MTD, at 9-10, D.I. 39. 38 Id. 39 Id. at 11-13. 40 Id. at 13-15. 41 Pl.’s Ans. to Defs. Sorom and Connor’s MTD, at 13-17, D.I. 56. 42 Id. at 17-20. 43 Id. at 20-23. 44 Defs. Manick and Kamadolli’s MTD, at 12-24 D.I. 50. 9 transfer claims in Counts V and VI must be dismissed against them under Rule
12(b)(6) because they are not proper parties under DUFTA, and, as argued by
Sorom and Connor, because the transferred assets were subject to a valid lien,
their transfer could not have been fraudulent under DUFTA.45 Finally, the
quantum meruit claim in Count VII should be dismissed because the Amended
Complaint alleges a valid contract, precluding a quantum meruit recovery.46
Additionally, as directors, Manick and Kamadolli CMD Global contracted
with Mantle and not them.47 CMD Global maintains that Delaware has
jurisdiction over the director defendants and that they were properly served,48
it stated viable claims against them as directors,49 and the quantum meruit
claim is properly pled in the alternative.50
13. Western Alliance’s Motion to Dismiss. Western Alliance
moves to dismiss Counts III, IV, and V, all under Rule 12(b)(6). A motion to
dismiss for failure to state a claim pursuant to Superior Court Rule 12(b)(6)
will not be granted if the “plaintiff may recover under any reasonably
45 Id. at 27-28. 46 Id. 47 Id. 48 Pl.’s Ans. to Defs. Manick and Kamadolli’s MTD, at 14-22, D.I. 59. 49 Id. at 24-25. 50 Id. at 32-35. 10 conceivable set of circumstances susceptible of proof under the complaint.”51
The Court's review is limited to the well-pled allegations in the Complaint.52
In ruling on a 12(b)(6) motion, the Court “must draw all reasonable factual
inferences in favor of the party opposing the motion.”53 Dismissal is
warranted “only if it appears with reasonable certainty that the plaintiff could
not prove any set of facts that would entitle him to relief.”54
14. Western Alliance asks the Court to consider the IP Security
Agreement and Settlement Agreement as integral to the complaint or
incorporated by reference.55 CMD Global objects, asserting that it lacked
access to it when filing, that the Security Agreement attached to the Complaint
expressly excluded IP collateral, and that the later IP and Settlement
agreements were not contemplated by and materially differ from the Security
Agreement’s terms.56
15. The Court agrees with CMD Global that, at the pleading stage,
the complaint generally defines the universe of facts for a Rule 12(b)(6)
51 Browne v. Robb, 583 A.2d 949, 950 (Del. 1990). 52 Doe v. Cahill, 884 A.2d 451, 458 (Del. 2005). 53 Id. 54 Id. 55 Def. Western Alliance’s MTD at 11-12, D.I. 28. 56 Pl.’s Resp. to Def.’s MTD at 12-13, D.I.37. 11 ruling.57 A document will only be considered if one of the well-recognized
limited exceptions apply: (1) when the document is integral to a plaintiff’s
claim and incorporated into the complaint; (2) when the document is not being
relied upon to prove the truth of its contents; or (3) when the document is an
adjudicative fact subject to judicial notice.58 A document is deemed integral
and incorporated into the complaint if the complaint relies on it as the source
of its factual assertions.59
16. The Court declines to consider the IP Security Agreement and
the Settlement Agreement for purposes of a motion to dismiss. Western
Alliance’s financing statements may be judicially noticed as public filings as
they were filed with the Delaware Secretary of State and their introduction
was not challenged by CMD Global.
17. Both the IP Security Agreement and the Settlement Agreement
do not fall into any of the previously mentioned exceptions. Western
Alliance’s attempt to characterize these documents as incorporated by
reference to the Security Agreement which was attached as an exhibit to the
57 Murray v. Mason, 244 A.3d 187, 192 (Del. Super. Ct. 2020) (quoting In re GM (Hughes) S'holder Litig., 897 A.2d 162, 169 (Del. 2006)). 58 In re Gardner Denver, Inc., 2014 WL 715705, at *2 (Del. Ch. Feb. 21, 2014). 59 See Fortis Advisors LLC v. Allergan W.C. Holding Inc., 2019 WL 5588876, at *3 (Del. Ch. Oct. 30, 2019). 12 Complaint fails.60 The Settlement Agreement and IP Security Agreement are
separate agreements from the Security Agreement, and there is no clear intent
for them to be incorporated by reference. Specifically, the Court agrees with
CMD Global that Western Alliance’s expansive definition of “Loan
Documents”61 would effectively nullify the rule by allowing a flood of
unrelated materials to be considered at the motion to dismiss stage. Therefore,
the Settlement Agreement and IP Security Agreement will not be considered
by the Court in deciding this motion.
18. CMD Global adequately pleads tortious interference by alleging
that Western Alliance knowingly induced Mantle to terminate the
Engagement Letter without justification, excluding CMD Global from the sale
process, and causing the loss of contractual fees and related damages. To state
a claim for tortious interference with contractual relations, CMD Global must
plead: (1) a valid contract; (2) knowledge by Western Alliance; (3) intentional
acts that are a significant factor in a breach; (4) without justification; and (5)
damages.62
60 Def. Western Alliance’s MTD at 12, D.I. 28. 61 Pl.’s Resp. to Def. Western Alliance’s MTD, D.I. 37. 62 Bhole, Inc. v. Shore Invs., Inc., 67 A.3d 444, 453 (Del. 2013) (citing Irwin & Leighton, Inc. v. W.M. Anderson Co., 532 A.2d 983, 992 (Del.Ch.1987)). 13 19. At this stage, CMD Global’s allegations suffice. Regarding a
valid contract and knowledge, CMD Global alleges a valid Engagement Letter
with Mantle,63 that Western Alliance was aware of it,64 that Western Alliance
expressed a desire to circumvent CMD Global’s fee,65 and asserted “veto
power” over the transaction process.66 As to the intentional interference and
causation element, CMD Global pleads Western Alliance directed Mantle to
terminate the Engagement Letter within hours of CMD Global securing a
revised Angstrom offer,67 cut CMD Global off from the sale process,68 and
thereby caused Mantle not to perform payment obligations owed upon closing
during the tail period.69 For damages, CMD Global alleges loss of its success
fee and diminution of consideration caused by delay and interference.70
20. The main element in dispute is whether Western Alliance acted
without justification. Justification is typically a fact‑intensive inquiry to be
made after considering the circumstances of the case.71 CMD Global alleges
63 Am. Compl. at ¶¶ 19,79, D.I. 34. 64 Id. at ¶¶ 43-44, 50, 52, 55, 60. 65 Id. at ¶¶ 73-77, 78, 80-84, Ex. D. 66 Id. at ¶¶ 74-75. 67 Id. at ¶ 78. 68 Id. at ¶¶ 83-86. 69 Id. at ¶¶ 97-99. 70 Id. 71 Bowl-Mor Co. v. Brunswick Corp., 297 A.2d 61, 66 (Del. Ch. 1972). 14 conduct by Western Alliance beyond mere exercise of contractual remedies
such as: (1) a scheme to avoid fees after CMD Global procured a buyer; (2)
exertion of control, including “veto power;” (3) demands to encumber
previously excluded IP; (4) a directive to terminate CMD Global’s
engagement to eliminate transparency; and (5) directions regarding sweeping
proceeds and cash.72 Taken as true, these facts plausibly allege that Western
Alliance acted “without justification” for the purposes of the pleading stage.
CMD Global squarely alleges Western Alliance’s aim to “circumvent CMD
Global’s fees,” its use of leverage to secure new IP collateral, and direction to
terminate CMD Global’s post‑procurement of the buyer.73
21. Western Alliance argues that the Restatement (Second) of Torts
§773 justifies its conduct as enforcement of a legally protected interest in good
faith and by appropriate means.74 CMD Global’s allegations, however,
plausibly support inferences of bad faith and inappropriate means (e.g., the
timing and purpose of the termination, cutting CMD Global out despite tail
protection,75 and steps to preclude payment), which cannot be resolved on the
72 See generally, Am. Compl., D.I. 34. 73 Id. 74 Def. Western Alliance’s MTD at 18, D.I. 28. 75 CMD Global defines “tail period” in its complaint as: “(i) within the term of CMD’s engagement, or (ii) within the 12 months after termination of its engagement” Am. Compl. at ¶ 30, D.I. 34. 15 pleadings.76 CMD Global highlights communications evidencing Western
Alliance’s intent, timing of the termination relative to CMD Global’s revised
offer, and alleged diminution from delay.77 Accordingly, Western Alliance’s
Motion to Dismiss Count III is DENIED.
22. Turning next to Count IV, Tortious Interference with Business
Relations, CMD Global must plead: (a) reasonable probability of a business
opportunity; (b) intentional interference by defendant with that opportunity;
(c) proximate causation; and (d) damages.78
23. CMD Global alleges a probability of it continuing to facilitate
and close the Angstrom transaction, and to maintain working relationships
with Mantle and potential purchasers.79 Western Alliance’s intentional acts
included directing termination of CMD Global’s engagement and excluding
them from the process.80 CMD Global alleges that they suffered damages,
specifically by the non-payment of the M&A Transaction Success fee.81
76 Flores v. Strauss Water, Ltd., 2016 Del. Ch. LEXIS 145, at *41 (Ch. Sep. 22, 2016). 77 Am. Compl. at ¶¶ 40, 44, 50-52, D.I. 34. 78 Connolly v. Labowitz, 519 A.2d 138, 143 (Del. Super. Ct. 1986) (quoting DeBonaventura v. Nationwide Mut. Ins. Co., Del. Ch., 419 A.2d 942, 947 (1980)). 79 Am. Compl. at ¶¶ 19, 26-28, 34, D.I. 34. 80 Id. at ¶¶ at 43-44, 74-78. 81 Id. at ¶¶ at 99-100, 102. 16 24. CMD Global pleads it had secured offers,82 continued to
negotiate improved pricing with Angstrom,83 received assurances of
payment,84 and maintained relationships necessary to consummate the sale,
all of which were disrupted by Western Alliance’s direction to terminate CMD
Global and exclude it from the sale process.85 As with Count III, Western
Alliance’s justification defenses turn on factual considerations inappropriate
for resolution now. CMD Global alleges intentional conduct by Western
Alliance aimed at eliminating CMD Global’s participation and fee.86 Those
allegations make the claim reasonably conceivable and include sufficient facts
to support a basis for relief. Moreover, CMD Global convincingly
distinguishes authority cited by Western Alliance, Surf’s Up Legacy Partner,
LLC v. Virgin Fest LLC.87 As CMD Global emphasizes, the relationship
between themselves and Western Alliance is not one of competitors. Thus,
the concern of a “chilling effect” on competition is of no moment here.88
Western Alliance’s Motion to Dismiss Count IV is DENIED.
82 Id. at ¶¶ 71-72. 83 Id. 84 Id. at ¶¶ 62-63. 85 Id. at ¶ 133. 86 Id. at ¶¶131-33. 87 2021 WL 117036, at *6 (Del. Super. Ct. Jan. 13, 2021). 88 Def. Western Alliance’s MTD at 14, D.I. 28. 17 25. In Count V, CMD Global asserts avoidance of fraudulent transfer
under 6 Del. C. § 1304(a)(1). The Amended Complaint alleges that Mantle
transferred transaction proceeds and cash to Western Alliance with actual
intent to hinder, delay, or defraud CMD Global’s fee, and that Mantle
separately granted new security interests in IP assets to Western Alliance with
similar intent.89
26. A qualifying transfer must be alleged by CMD Global to properly
state a claim for actual fraudulent transfer.90 A qualifying transfer is defined
as:
[E]very mode, direct or indirect, absolute or conditional, voluntary or involuntary, of disposing of or parting with an asset or an interest in an asset, and includes payment of money, release, lease and creation of a lien or other encumbrance but excludes, without limitation, any disposition of or parting with property or an interest in property described in paragraph (2) of this Section.91
An asset is defined as property of a debtor, but excludes “[p]roperty to the
extent it is encumbered by a valid lien….”92 Western Alliance cites
Cleveland-Cliffs Burns Harbor LLC v. Boomerang Tube, LLC,93 for the
89 Am. Compl. at ¶¶ 138-45, D.I. 34. 90 6 Del. C. § 1301. 91 6 Del. C. § 1301(12). 92 6 Del. C. § 1301(2). 93 2023 WL 5688392, at *8 (Del. Ch. Sept. 5, 2023). 18 proposition that, “[f]or a transaction to qualify as a ‘transfer’ of ‘assets’ under
the DUFTA, the value of the transferred property must exceed the value of
any valid liens.”94 Western Alliance argues that no “transfer” occurred
because the property was encumbered by a “valid lien” exceeding the value
of the transferred assets.95 CMD Global responds that whether and to what
extent Western Alliance held a “valid lien” that fully absorbed the transferred
value presents factual issues not resolved by the pleadings alone.96
27. At this stage, CMD Global’s allegations suffice. CMD Global
alleges Mantle transferred all transaction proceeds and remaining cash to
Western Alliance while aware of CMD Global’s threatened litigation,
rendering Mantle functionally insolvent, and did so with actual intent to
hinder, delay, or defraud.97 CMD Global further alleges badges of fraud,
including concealment, the timing relative to threatened suit and fee
entitlement, transfer of substantially all assets, and lack of reasonably
equivalent value for newly granted IP security.98 Most importantly, CMD
Global alleges that the transfer of the proceeds of the Angstrom sale to
94 Id. 95 Def. Western Alliance’s MTD at 29, D.I. 28. 96 Pl.’s Resp. to Western Alliance’s MTD at 32, D.I. 37. 97 Am. Compl. at ¶¶ 142-144, D.I. 34. 98 Pl.’s Resp. to Western Alliance’s MTD at 30-31, D.I. 37. 19 Western Alliance exceeded or nearly exceeded the full amount of Mantle’s
indebtedness to Western Alliance.99 Because the Amended Complaint alleges
that the value of property transferred to Western Alliance, when viewed in the
light most favorable to CMD Global, exceeded the amount of any valid liens,
there is at least a factual issue that the transaction would count as a transfer
under DUFTA.
28. Western Alliance relies on a UCC‑1 and the Settlement
Agreement to show the lien’s value exceeded transferred value.100 The Court
declines to consider the Settlement Agreement at this stage. In any event,
CMD Global has not pled facts conceding lien scope, collateral value, or
outstanding debt in a manner that would defeat the claims as a matter of law.
CMD Global argues discovery is needed on loan documents, loan accounting,
prior sweeps or foreclosures, allocation of value, and the validity/scope of any
asserted liens against specific assets and proceeds. The Court agrees.
29. As to Rule 9(b), CMD Global pleads actual intent with
particularity.101 The complaint details chronology, communications
evidencing purpose to avoid fees,102 steps to secure previously excluded IP
99 Am. Compl. at ¶ 96., D.I. 34. 100 Def. Western Alliance’s MTD at 31, D.I. 28. 101 Super. Ct. Civ. R. 9. 102 Am. Compl. at ¶¶ 52, 74-75, D.I. 34. 20 collateral during distress,103 timing of Western Alliances assertion of control
over Mantle,104 termination, concealment of closing, and immediate sweeping
of proceeds and cash.105 Specifically the Court finds that CMD Global
identified specific statements, dates, actions, and transfers tied to the alleged
intent to hinder, delay, or defraud CMD Global.
30. CMD Global alleges that the Security Agreement excluded IP
collateral.106 It further asserts that Western Alliance sought and obtained a
new security interest in previously unencumbered IP while Mantle was
insolvent.107 CMD Global also contends that this new obligation was incurred
to prevent it from accessing the value of the IP and its proceeds.108 Western
Alliance’s contention that IP‑related proceeds were already within collateral
cannot defeat CMD Global’s allegations at this stage, particularly given CMD
Global’s pleading that IP was previously excluded and that the new grant
encumbered previously free assets. CMD Global pleads that the new IP
Security Agreement was demanded post‑default to avoid payment of CMD
Global’s fee and that no reasonably equivalent value flowed to Mantle for that
103 Id. at ¶ 48. 104 Id. at ¶¶ 40, 74-75, 80. 105 Id. at ¶¶ 43; 52; 97-99. 106 Pl.’s Resp. to Western Alliance’s MTD at 36, D.I. 37. 107 Id. 108 Id. 21 encumbrance.109 On this record, Count V is reasonably conceivable. Western
Alliance’s Motion to Dismiss Count V is DENIED.
31. Turning to count VI, the Court agrees with Western Alliance that
CMD Global asserts a remedy not recognized as a cause of action. It is well-
recognized that an attachment is a remedy available at law.110 Through Count
VI, CMD Global seeks a specific remedy for the success of Count V. While
this remedy can be sought, as a technical matter, it cannot be asserted as a
cause of action.111 Western Alliance’s Motion to Dismiss Count VI is
GRANTED. This ruling has no effect on the case other than to clean up the
pleadings.112
32. Sorom and Connor’s Motion to Dismiss. Sorom and Connor
move to dismiss Counts V, VI, and VII, also under Rule 12(b)(6). In seeking
dismissal of Count V, they argue, as Western Alliance did, that the transfer to
Western Alliance was not a qualifying transfer under DUFTA because the
transferred assets were fully encumbered by obligations to Western
Alliance.113 The Court was unpersuaded when Western Alliance made that
109 Id. 110 Yu v. GSM Nation, LLC, 2017 WL 2889515, at *4 (Del. Ch. July 7, 2017). 111 Quadrant Structured Prod. Co. v. Vertin, 102 A.3d 155, 203 (Del. Ch. 2014). 112 Id. 113 Defs. Sorom and Connor’s MDT, at 9-10, D.I. 39. 22 argument and remains unpersuaded by Sorom and Connor. Sorom and
Connor’s Motion to Dismiss Count V is DENIED.
33. Sorom and Connor next argue that Count VI purports to seek
recovery of the alleged fraudulent transfers and attach the transferred property
in order to make it whole. 114 While Count VI names all Defendants, it only
seeks relief from Mantle and Western Alliance:
CMD seeks an order and judgment against all Defendants (1) issuing an attachment to the Transaction Proceeds, Cash Assets, and IP Assets held by Western Alliance or Mantle in the amount of the M&A Transaction Fee for the benefit of CMD [and] (2) allowing CMD to recover the M&A Transaction Success Fee from Mantle and Western Alliance pursuant to § 1307 of the DUFTA….. 115
Further, nothing in DUFTA allows for the recovery of a judgment against
Sorom and Connor as officers of Mantle because 6 Del. C. § 1308(b) limits
recovery to transferees and Sorom and Connor were not transferees.116
36. Citing Humanigen, Inc. v. Savant Neglected Diseases, LLC,117
CMD Global counters that a “non-transferee can be liable for fraudulent
114 Id. at 10-13. 115 Id. 116 Id. (citing 6 Del. C. §§ 1307(a), 1308(b)). 117 2012 WL , 4344172, at *16 (Del. Super. Ct. July 9, 2021). 23 transfer if it is a beneficiary of the fraudulent transfer.”118 According to CDM
Global the benefit Sorom and Connor received was “indirect” - it allowed
them to “appease” Western Alliance.119 But, such a speculative and non-
quantifiable indirect “benefit” does not pass muster. The Court must
determine: (1) whether the benefit was received by the beneficiary; (2)
whether the benefit is quantifiable; and (3) whether the benefit is “accessible
to the beneficiary.”120 Under this test (with its requirement that all three
factors be present), Sorom and Connor are not beneficiaries.
36. Apparently sensing the thin reed it was grasping with its indirect
beneficiary argument, CDM Global seeks further discovery to determine
whether the Loan and Security Agreement’s “Guaranty” provision provides
Sorom and Connor with a real benefit.121 This back-up argument fails because
there are no allegations in the Amended Complaint that either Sorom or
Connor guaranteed Mantle’s obligation to Western Alliance or that the
payment to Western Alliance satisfied any guaranty obligations.
118 Pl.’s Ans. to Sorom and Connor’s MTD, at 17-18, D.I. 56. 119 Id. 120 Id. (citing In re Green Field Energy Servs. Inc., 2018 WL 1116374, at *1 (Bank. D. Del. Feb. 27, 2018)). 121 Pl.’s Ans. to Sorom and Connor’s MTD, at 18-19, D.I. 56. 24 35. Lastly, CDM Global argues that “principles of equity” under §
1307 allows CDM Global to recover against Sorom and Connor.122 Nowhere
in § 1307 does it authorize the Court to expand the basis for finding liability
for a fraudulent transfer. Rather, Delaware courts have construed the remedial
provisions of the statute narrowly and have rejected attempts to create
secondary liability.123 Sorom and Connor’s Motion to Dismiss Count VI is
GRANTED.
36. Finally, Sorom and Connor move to dismiss Count VII, CDM
Global’s alternate Quantum Meruit claim. The claim is pled in the alternative
“in the event the Engagement Letter or its provisions are deemed
unenforceable.”124 ‘“Quantum meruit ’is a quasi-contractual remedy by which
a plaintiff, in the absence of an express agreement, can recover the reasonable
value of the materials or services it rendered to the defendant.’”125 Recovery
on the basis of quantum meruit is generally available only if there is no express
122 Id. at 19. 123 Cleveland-Cliffs Burns Harbor LLC v. Boomerang, LLC, 2023 WL 5688392, at n. 144. 124 Am. Compl. at ¶ 153, D.I. 34. 125 Alpha Contracting Services, Inc. v. 13 Professional Retail Services, Inc. 2019 WL 151482, at *3 (Del. Super. Jan. 9, 2019) (quoting Middle States Drywall, Inc. v. DMS Properties-First, Inc., 1996 WL 453418, at *10 (Del. Super. May 18, 1996) (quotations omitted). 25 contract between the parties.126 Here, Sorom and Connor acknowledge that
the Engagement Letter is “a valid, binding, and enforceable contract.”127
Since quantum meruit and an enforceable agreement cannot co-exist, and
because the existence of a valid agreement is unchallenged, Sorom and
Connor’s Motion to Dismiss Count VII is GRANTED.
37. Manick and Kamadolli’s Motion to Dismiss. Manick and
Kamadolli move to dismiss Counts V, VI, and VII. They move to dismiss all
claims against them on the basis of lack of personal jurisdiction and
ineffective service.128 They move under Rule 12(b)6) to dismiss Counts V and
VI, because, as directors of Mantle, they were neither transferees, nor
transferors of Mantle’s assets to Western Alliance.129 They move to dismiss
the Quantum Meruit claim because they too do not challenge the validity of
the Engagement Letter.
38. The Court notes that Manick and Kamadolli move to dismiss
Count V on a different basis than Sorom and Connor. Sorom and Connor
argued that the transaction did not qualify as a transfer under DUFTA because
the amount of the transfer did not exceed Mantle’s indebtedness to Western
126 See, Chrysler Corp. v. Airtemp Corp., 426 A.2d 845, 853 (1980). 127 Pl.’s Sorom and Connor’s MTD, at 14, D.I.39. 128 Defs. Manick and Kamadolli’s MTD, at 12-24, D.I. 50. 129 Id. at 24-29. 26 Alliance.130 As discussed above, the Amended Complaint alleged that the
amount of the transfer did exceed the indebtedness and denied Sorom and
Connor’s Motion to Dismiss Count V.131 In contrast, Manick and Kamadolli
take a more persuasive approach. They focus on their status as directors who
were not transferees under DUFTA.132 DUFTA provides no remedy against
them. Manick and Kamadolli’s Motion to Dismiss Count V is GRANTED.133
For the same reason their Motion to Dismiss Count VI is GRANTED. Just
as the other Defendants accept the validity of the Engagement Letter, so do
Manick and Kamadolli.134 Their Motion to Dismiss Count VII is GRANTED.
Because the Court grants Manick and Kamadolli’s motion, it need not address
their jurisdiction and service arguments.
THEREFORE, Defendant Western Alliance Bank’s Motion to
Dismiss is DENIED as to Counts III, IV, and V, and GRANTED as to Count
VI. Count VI is DISMISSED as to Western Alliance Bank. Defendants
Theodore Sorom and Stephen Connor’s Motion to Dismiss is DENIED as to
130 Defs. Sorom and Connor’s MTD at 9-10, D.I. 39. 131 Supra, at ¶ 27 (citing Am. Compl., at ¶ 99, D.I. 34). 132 Defs. Manick and Kamadolli’s MTD, at 26-27, D.I. 50. 133 The Court recognizes that granting Manick and Kamadolli’s Motion to Dismiss Count V results in an inconsistency its denial of Sorom and Connor’s motion. The Court trusts that inconsistency will be resolved as the case progresses. 134 Defs. Manick and Kamadolli’s MTD, at 28-32, D.I. 50. 27 Count V, and GRANTED as to Counts VI and VII. Counts VI and VII are
DISMISSED WITH PREJUDUICE as to Defendants Sorom and Connor.
Defendants Alexandra Manick and Shyman Kamadolli’s Motion to Dismiss
is GRANTED. Counts V, VI, and VII as to Defendants Manick and
Kamadolli are DISMISSED WITH PREJUDICE.
IT IS SO ORDERED.
/s/ Ferris W. Wharton Ferris W. Wharton, J.