COURT OF CHANCERY OF THE STATE OF DELAWARE PAUL A. FIORAVANTI, JR. LEONARD L. WILLIAMS JUSTICE CENTER VICE CHANCELLOR 500 N. KING STREET, SUITE 11400 WILMINGTON, DELAWARE 19801-3734
Date Submitted: February 26, 2026 Date Decided: March 1, 2026
Tyler J. Leavengood, Esquire Timothy Jay Houseal, Esquire Jaclyn C. Levy, Esquire Colin A. Keith, Esquire Charles P. Wood, Esquire Young Conaway Stargatt Megan R. Thomas, Esquire & Taylor, LLP Joshua S. Almond, Esquire Rodney Square Potter Anderson & Corroon LLP 1000 North King Street 1313 N. Market Street Wilmington, DE 19801 Hercules Plaza, 6th Floor Wilmington, DE 19801
Jason J. Rawnsley, Esquire Gabriela Z. Monasterio, Esquire Richards, Layton & Finger, P.A. One Rodney Square 920 North King Street Wilmington, DE 19801
RE: ECO Cap., Inc. v. Nivel Parts & Mfg. Co., LLC et al., C.A. No. 2026-0173-PAF
Dear Counsel:
This letter decision resolves plaintiff ECO Capital, Inc.’s (“ECO”) motion
challenging defendant Jeffery Allen, Inc.’s (“JAI”) designation of “Highly
Confidential” discovery material (the “Motion”). 1 The court grants the Motion. As
1 Dkt. 74. ECO Capital, Inc. v. Nivel Parts & Manufacturing Co., LLC, et al., C.A. No. 2026-0173-PAF March 1, 2026 Page 2 of 26
a result, all documents that JAI has designated as Highly Confidential shall lose that
designation and are deemed Confidential under the terms of the confidentiality order
governing this case.
I. FACTUAL BACKGROUND
This is a dispute over the sale and distribution of lithium golf cart batteries.
In 2023, defendant Nivel Parts & Manufacturing Co., LLC (“Nivel”) became the
exclusive wholesale distributor of ECO batteries. That arrangement is documented
in a “Distribution Agreement,” under which Nivel agreed to “not distribute or sell
another lithium battery primarily intended for use in” golf carts and other personal
transportation vehicles.2 Prior to its specified expiration date, the Distribution
Agreement allows either party to terminate the agreement without cause or for
cause.3 A termination without cause would become effective 180 days following
the delivery of a notice of termination.4 A termination for cause could be invoked
in the event of breach and a failure to cure within a specified period. A termination
for cause, which is available to a non-breaching party, is effective immediately.5
2 Dkt. 81 (“Am. Compl.”) Ex. 1 (“Distribution Agreement”) § 2.2. 3 Id. § 9.2. 4 Id. § 9.2(a). 5 Id. § 9.2(b)(ii). ECO Capital, Inc. v. Nivel Parts & Manufacturing Co., LLC, et al., C.A. No. 2026-0173-PAF March 1, 2026 Page 3 of 26
On September 24, 2025, Nivel notified ECO that it was terminating the
Distribution Agreement without cause. The termination notice acknowledged that
Nivel would continue to perform for another 180 days, through March 24, 2026.6
Unbeknownst to ECO at that time, Nivel had been negotiating to acquire ECO’s
competitor, Bolt Energy USA, LLC (“Bolt”), which sold batteries under the Bolt
label. On November 12, 2025, Nivel publicly announced that it had acquired Bolt
and that it would be selling Bolt batteries.
A. The Prior Litigation
On November 20, 2025, ECO filed suit in this court alleging Nivel breached
the Distribution Agreement and requesting an injunction to prevent Nivel from
selling Bolt batteries during the 180-day tail period.7 Later that evening, Nivel
purported to terminate the Distribution Agreement for cause, which Nivel claimed
was effective immediately, and relieved it from complying with the 180-day tail
period.8
After briefing and argument, the court granted ECO’s motion for a temporary
restraining order preventing Nivel from selling Bolt batteries. The court entered the
6 Am. Compl. ¶ 27. 7 See C.A. No. 2025-1356 (the “First Action”) Dkt. 1. 8 Am. Compl. ¶ 18. ECO Capital, Inc. v. Nivel Parts & Manufacturing Co., LLC, et al., C.A. No. 2026-0173-PAF March 1, 2026 Page 4 of 26
TRO on December 3, 2025, at 4:52 p.m.9 The TRO was conditioned on ECO posting
a $100,000 bond.10 ECO deposited the bond amount with the court the next morning
and filed a letter on the docket at 12:36 p.m. confirming that the bond requirement
had been satisfied.11 The parties then engaged in further expedited discovery and
briefing on ECO’s motion for a preliminary injunction. At the start of the December
12 hearing on that motion, the court informed the parties that it was scheduling a
trial for December 29–30, 2025. On December 16, 2025, the court granted ECO’s
motion for a preliminary injunction, having concluded that “absent an injunction,
the Defendant’s ability to sell Bolt batteries, which directly compete with ECO
batteries, will continue to cause harm” to ECO.12
B. The Settlement
On December 21, 2025, Nivel and ECO advised the court that they had
reached an agreement in principle to settle the litigation, and one day later, the court
granted the parties’ stipulated order to vacate the trial schedule.13 ECO and Nivel
executed their settlement agreement on New Year’s Eve (“Settlement Agreement”).
9 First Action Dkt. 22; Am. Compl. ¶ 21. 10 First Action Dkt. 22; see Am. Compl. ¶ 21. 11 First Action Dkt. 24; see Am. Compl. ¶ 21. 12 First Action Dkt. 112 at 45:18–23. 13 First Action Dkt. 102. ECO Capital, Inc. v. Nivel Parts & Manufacturing Co., LLC, et al., C.A. No. 2026-0173-PAF March 1, 2026 Page 5 of 26
It required ECO and Nivel to “continue to abide by the Distribution Agreement,” and
specified that:
Nivel and anyone acting on Nivel’s behalf, including its subsidiaries and affiliates, shall not distribute or sell any lithium batteries that were not manufactured by ECO and which are primarily intended for use in golf cars, personal transportation vehicles, and low-speed vehicles . . . through March 24, 2026, as contemplated by Section 2.2 of the Distribution Agreement.14
Nivel also agreed to pay ECO’s attorney’s fees in the litigation.15 The Settlement
Agreement contained mutual releases and an anti-reliance provision stating that:
THE PARTIES ACKNOWLEDGE THE CONTESTED AND ADVERSARIAL NATURE OF THE DISPUTE AND STIPULATE THAT IN EXECUTING THIS SETTLEMENT AGREEMENT THEY ARE NOT RELYING ON ANY REPRESENTATION BY ANY OTHER PARTY OR ITS AGENTS, REPRESENTATIVES, OR ATTORNEYS WITH REGARD TO (1) FACTS UNDERLYING THE DISPUTE; (2) THE SUBJECT MATTER OR EFFECT OF THIS SETTLEMENT AGREEMENT, AND (3) ANY OTHER FACTS OR ISSUES WHICH MIGHT BE DEEMED MATERIAL TO THE DECISION TO ENTER INTO THIS SETTLEMENT 16 AGREEMENT.
In accordance with the Settlement Agreement, ECO and Nivel filed a
stipulated order dissolving the preliminary injunction and dismissing each party’s
14 Am. Compl. Ex. 2 (“Settlement Agreement”) § 1.1(b). 15 Id. § 1.3. 16 Id. § 7.3. ECO Capital, Inc. v. Nivel Parts & Manufacturing Co., LLC, et al., C.A. No. 2026-0173-PAF March 1, 2026 Page 6 of 26
claims with prejudice.17 The court entered the stipulated judgment on January 6,
2026.18
C. The New Action
On February 12, 2026, ECO filed the present action, based upon information
that it learned after executing the Settlement Agreement. ECO claims that the
Settlement Agreement was the product of fraud and that Nivel has breached both the
Settlement Agreement and the Distribution Agreement. ECO also asserts that JAI,
a retail and wholesale distributor of Bolt batteries, conspired with Nivel to commit
fraud. Specifically, ECO alleges that in the lead up to Nivel’s acquisition of Bolt,
during the litigation leading up to the Settlement Agreement, as well as after the
Settlement Agreement became effective, Nivel and JAI coordinated to sell Bolt
batteries.19
On February 13, 2026, the court granted ECO’s motion for expedited
proceedings and entered a temporary restraining order, preventing Nivel from
directly or indirectly selling or distributing Bolt batteries. At that time, the court
concluded that ECO had stated colorable claims for breach of contract but had not
17 Id. § 3. 18 First Action Dkt. 115. 19 Am. Compl. ¶¶ 27–29. ECO Capital, Inc. v. Nivel Parts & Manufacturing Co., LLC, et al., C.A. No. 2026-0173-PAF March 1, 2026 Page 7 of 26
stated a colorable claim for fraudulent inducement or conspiracy to commit fraud.20
The court granted ECO’s motion to expedite and scheduled a preliminary injunction
hearing for February 24.21 Days later, Nivel and ECO agreed to a stipulated
preliminary injunction through March 24.22 They disagreed, however, as to whether
an expedited trial was warranted.
JAI, a Florida entity, claims it is not subject to jurisdiction in Delaware and
has moved to dismiss. In granting ECO’s first motion to expedite, the court
permitted ECO to engage in limited discovery in aid of establishing jurisdiction over
JAI. The court observed that JAI probably possessed information relevant to ECO’s
breach of contract claims against Nivel and encouraged JAI to be cooperative in
facilitating discovery. The court also noted that ECO might seek to obtain discovery
from JAI through a subpoena.
On February 20, 2026, ECO filed an amended complaint, which added factual
allegations to support its original claims and asserted a new claim against JAI for
tortiously interfering with the Settlement Agreement and the Distribution
20 The court reached this conclusion based on an anti-reliance clause in the Settlement Agreement. Dkt. 118 24:6–25:3. 21 Dkt. 106 42:6–8. 22 Dkts. 71, 79. ECO Capital, Inc. v. Nivel Parts & Manufacturing Co., LLC, et al., C.A. No. 2026-0173-PAF March 1, 2026 Page 8 of 26
Agreement. On February 23, the court granted ECO’s motion for expedited
proceedings and scheduled a two-day trial for March 10-11, 2026, on all claims,
including those asserted against JAI for conspiracy to commit fraud and for tortious
interference with contract, both of which the court found to be colorable.23
In the flurry of motion practice, the parties submitted competing forms of a
confidentiality order to govern discovery.24 The court rejected the parties’ proposed
orders and, instead, entered a confidentiality order that largely tracks the standard
form of two-tiered confidentiality order that is posted on the court’s website.25
Under the Confidentiality Order, a document may be designated as Confidential if it
contains:
nonpublic, confidential, personal, business, strategic, proprietary, or commercially sensitive information that requires the protections provided in [the Confidentiality] Order and that has not become part of the public record.26
A document may be designated as Highly Confidential if it contains:
Confidential Discovery Material that, if disclosed other than as permitted pursuant to paragraph 8 of this [Confidentiality] Order, the
23 See Dkt. 96, 117. The trial is limited to questions of liability and ECO’s request for equitable relief in the form of extending the term of the Distribution Agreement. The damages phase, if necessary, will occur at a later date. Dkt. 117 14:12–21. 24 Dkts. 40, 41. 25 Dkt. 47 (“Confidentiality Order”). 26 Id. ¶ 1(b). ECO Capital, Inc. v. Nivel Parts & Manufacturing Co., LLC, et al., C.A. No. 2026-0173-PAF March 1, 2026 Page 9 of 26
Producing Person in good faith and reasonably believes is substantially likely to cause injury to the Producing Person.27
Confidential and Highly Confidential Discovery Material may only be
transmitted and viewed by certain people in connection with litigation. The critical
difference between the two is, generally, that Highly Confidential Discovery
Material may not be transmitted to or reviewed by the parties and their officers,
directors, and employees, even if they are assisting with the litigation.28
D. The Current Discovery Dispute
On February 20, ECO filed the Motion challenging JAI’s designation of
documents as Highly Confidential. ECO asserted that JAI had designated
approximately 78% of the 2,769 documents produced as of that date as Highly
Confidential.29 JAI broadly defended its designations, maintaining that the
documents designated as Highly Confidential included “personally identifiable
information for former, current, and prospective customers, customer pricing
information, JAI pricing information, internal forecasts, pricing models, strategic
plans, inventory projections, manufacturers and/or manufacturers contact
27 Id. ¶ 1(e). 28 Id. ¶¶ 7–8. 29 Motion at 1. ECO Capital, Inc. v. Nivel Parts & Manufacturing Co., LLC, et al., C.A. No. 2026-0173-PAF March 1, 2026 Page 10 of 26
information and pricing, and internal business correspondences” all of which “is
highly competitively sensitive” information for which “disclosure to . . .ECO[]—a
direct competitor in the golf car industry—is substantially likely to cause injury to
JAI.”30 JAI further asserted that “[t]he very nature of ECO’s discovery requests calls
for production of highly confidential information” so the percentage of designation
should “come as no surprise to ECO.”31
Before ECO filed the Motion, JAI “proposed a compromise” requiring ECO
to identify JAI documents that ECO believed were not Highly Confidential, after
which JAI would consider re-reviewing those designations.32 ECO rejected that
proposal as being inconsistent with the Court of Chancery Rules and the
Confidentiality Order.33 Instead, ECO pressed for an order declaring that all JAI
documents designated as Highly Confidential be redesignated as Confidential.
Given the highly expedited nature of this matter, the court took a cautious
approach to resolving the discovery dispute. On Monday, February 23, the court
granted the Motion with modifications (the “Order”), and implemented a detailed,
30 Dkt. 83 ¶ 1. 31 Id. ¶ 2. 32 Id. ¶ 6. 33 See e.g. Dkt. 74 ¶¶ 19–20; see also Dkt. 84 ¶¶ 5, 17. ECO Capital, Inc. v. Nivel Parts & Manufacturing Co., LLC, et al., C.A. No. 2026-0173-PAF March 1, 2026 Page 11 of 26
albeit expedited, process aimed at resolving the dispute or, at a minimum, narrowing
the issues.34 The Order directed JAI to re-review its designation of Highly
Confidential documents and to provide a new designation list to ECO, which ECO
could then challenge.35 The Order required the parties to meet and confer over any
unresolved issues and directed that Delaware counsel be “present and personally
involved in the meet and confer session.”36 If the parties could not resolve their
dispute, the Order directed them to submit a joint letter with a list of disputed
designations by Thursday, February 26.37 To ensure integrity in the process, the
court borrowed a tool that has been used in disputes over the withholding of
documents based upon assertions of attorney-client privilege and the work product
doctrine.38 Specifically, the court directed the parties as follows:
34 Dkt. 89 (the “Order”). 35 Id. 36 Id. 37 Id. 38 See ATP III GP, Ltd. v. Rigmora Biotech Inv'r One LP, 2025 WL 2601240 (Del. Ch. Sept. 8, 2025) (providing a procedure for cross-checking privilege logs which allowed plaintiff a 30% error rate in claiming privilege on a sample set documents submitted for in camera review, and, ultimately, holding that all documents subject to the motion were deemed to waive privilege when the special discovery magistrate concluded that plaintiff had no basis to assert privilege for 60% of the selected documents); Pfizer Inc. v. Ranbaxy Laboratories Ltd., 2004 WL 2323135, at *3 (D. Del. Oct. 7, 2004) (ordering production of all documents on plaintiff’s privilege log after in camera review of a sample set of documents submitted by defendant and finding that those documents were not privileged); ECO Capital, Inc. v. Nivel Parts & Manufacturing Co., LLC, et al., C.A. No. 2026-0173-PAF March 1, 2026 Page 12 of 26
ECO may identify and submit for in camera inspection a sample of six documents that remain the subject of dispute. If the court determines that any document in the sample does not qualify for Highly Confidential treatment, then the court may order the de-designation of all documents that are contained in the list attached to the parties’ joint letter submission.39
On February 26, 2026, ECO and JAI filed a joint letter framing the
outstanding areas of disagreement (the “Joint Letter”).40 According to the Joint
Letter, JAI redesignated 36 documents from Highly Confidential to Confidential and
determined that 3 other documents previously designated as Highly Confidential
were neither Highly Confidential nor Confidential.41 In sum, JAI continues to
maintain that 2,130 of the 2,769 documents it has produced in this litigation (77%)
Thermo Fisher Sci. PSG Corp. v. Arranta Bio MA, LLC, 2023 WL 300150, at *9 (Del. Ch. Jan. 18, 2023) (stating, after reviewing a sample of documents submitted for in camera review, “[t]he problems with [p]laintiff's log are so pervasive that I could—and arguably should—grant [d]efendant's request for relief [to produce all privileged documents to defendant without redactions] as to the entirety of [p]laintiff's log.”); see also Storagecraft Tech. v. Persistent Telecom Sols., Inc., 2016 WL 5852464, *2 (D. Utah Oct. 6, 2016) (ordering defendant to re-review its entire production of highly confidential designated documents and, if plaintiff continues to believe defendant is significantly over designating, plaintiff must submit for in camera review a sample set of documents and the court will impose appropriate sanctions if defendant continues to over designate documents, which may include “stripping the [highly confidential] designation from all of [d]efendant’s documents”), objections overruled, 2016 WL 6988819 (D. Utah Nov. 29, 2016). 39 Order. 40 Dkt. 103 (“Joint Letter”). 41 Id. at 2. ECO Capital, Inc. v. Nivel Parts & Manufacturing Co., LLC, et al., C.A. No. 2026-0173-PAF March 1, 2026 Page 13 of 26
warrant Highly Confidential treatment.42 ECO disputes the Highly Confidential
designation of all of those documents.43 ECO declined JAI’s proposed compromises
and submitted six disputed documents for in camera review.44
II. ANALYSIS
“Confidentiality orders must . . . ensure that only truly confidential
information is being withheld from public disclosure and that the parties are not
using the protective order as a device to shield nonconfidential information from the
public” in an effort to “sanitize the public record” or shield “potentially embarrassing
or unflattering” information. 2 Donald J. Wolfe, Jr. & Michael A. Pittenger,
Corporate and Commercial Practice in the Delaware Court of Chancery § 6.02 (2d
ed. 2021) (citing Publicker Indus., Inc. v. Cohen, 733 F.2d 1059, 1071 (3d Cir.
1984); In re Walt Disney Co. Deriv. Litig., 2004 WL 368938, at *1 (Del. Ch. Feb.
24, 2004)). When JAI designated documents as Highly Confidential, it was required
to have “a good faith basis for the designation.”45 Under the Confidentiality Order,
42 Beyond that, JAI told ECO that it might “consider, on an expedited basis, re-designating documents ECO [] identifie[s] as necessary, redact highly confidential information from document[s] ECO considers necessary, and . . . allow a designated ECO employee to review Highly Confidential material under the” Confidentiality Order). Joint Letter at 5–6. 43 Id. at 5; see id. Ex. 1. 44 See Dkt. 104. 45 Confidentiality Order ¶ 6. ECO Capital, Inc. v. Nivel Parts & Manufacturing Co., LLC, et al., C.A. No. 2026-0173-PAF March 1, 2026 Page 14 of 26
JAI, as the producing party, “bears the burden of establishing that the [challenged
documents] qualif[y] as . . . Highly Confidential Discovery Material.”46 See
Brandrep, LLC v. Ruskey, 2018 WL 6820964, at *1 (Del. Ch. Dec. 27, 2018)
(“Where designations of confidentiality have been made pursuant to a protective
order, the burden is on the designating party to show good cause why its designations
should be sustained if the non-designating party objects.”). “A trial court retains the
jurisdiction and authority to enforce, modify, or terminate any confidentiality order
it has entered. . . as long as that order remains in effect.” Hallett v. Carnet Hldg.
Corp., 809 A.2d 1159, 1162 (Del. 2002).
The court has carefully reviewed the six documents selected by ECO for in
camera review. JAI continues to maintain that these documents, along with the other
2,130 documents designated as Highly Confidential, warrant that treatment
following three reviews. The first review occurred prior to JAI’s initial production.
The second was in response to the court’s February 23 Order, which directed JAI to
conduct another review of its designations in response to the Motion. The third was
when JAI and ECO met and conferred before filing the joint letter on February 26,
which was also a requirement of the Order. That process resulted in JAI’s de-
46 Id. ¶ 15. ECO Capital, Inc. v. Nivel Parts & Manufacturing Co., LLC, et al., C.A. No. 2026-0173-PAF March 1, 2026 Page 15 of 26
designating or downgrading only 2% of the documents that it had originally
designated as Highly Confidential. That, alone, gives rise to suspicion. See Thermo
Fisher, 2023 WL 300150 at *4 (“Having many log entries that do not identify an
attorney is a red flag indicative of larger problems. That turned out to be very true
here.”); see also Procaps S.A. v. Patheon Inc., 2015 WL 4430955, at *9 (S.D. Fla.
July 20, 2015) (“Procaps’ attorneys presumably performed the final review [of the
documents], and one or more of its attorneys realized, or should have realized, that
a 95% highly confidential, [] designation rate is problematic and questionable (or
‘absurd’) on its face.”).
What follows is the court’s analysis of the six documents submitted for in
camera review.
A. JAI-0003594
The first document is a single, two-line text message from Art Porter of JAI
to a person only identified as “Chuck” of Victory Golf Carts.47 The text message
was sent at 1:51 p.m. on January 22, 2026, and reflects a potential sales lead that
Nivel’s Chief Executive Officer, Donnie Jouppi passed along to Porter. The text
47 Bates Number JAI-0003594. ECO Capital, Inc. v. Nivel Parts & Manufacturing Co., LLC, et al., C.A. No. 2026-0173-PAF March 1, 2026 Page 17 of 26
me a call on this before you begin to work on this. I know it’s a lot of docs but I
really need them as soon as possible.” The documents Sverdlow requested in the
email include “PO’s 136, 148, 149, [and] 150 with Nivel” and the verification of
cancellation, copies of every purchase order with the China-based manufacturer of
Bolt batteries, verification of wires sent to the manufacturer, and the purchase order
reflecting the “scramble[] of December 3 to buy a bunch of batteries from Nivel
before the injunction was finalized with the required bond.” Berman responded the
next day with the requested information. The attachments to Berman’s email were
not submitted for in camera review. This email exchange is not Highly Confidential.
The emails contain no specifics about the purchase orders or payments to the
manufacturer. The mere fact that JAI cancelled purchase orders and issued other
purchase orders is not substantially likely to cause injury to JAI if that information
is produced to ECO.
C. JAI-0003447
The third document is a partial screenshot of an email from Ken Brasington
of Edgewater Custom Carts to someone only identified as “Jenn.”49 The screenshot
obscures the date, subject line, and email addresses of the sender and recipients. In
49 Bates Number JAI-0003447. ECO Capital, Inc. v. Nivel Parts & Manufacturing Co., LLC, et al., C.A. No. 2026-0173-PAF March 1, 2026 Page 18 of 26
the substance of the email, Brasington asks for help in ordering golf cart batteries
because he had been told that he could not place them through Nivel and needed to
call Bolt. The screenshot also contains the email address and phone number for
Edgewater Custom Carts.
The screenshot of this email is not highly confidential nor is the email itself if
it were produced in native form. The phone number in the email is also not
confidential because it is the official phone number for Edgewater Custom Carts.
There is nothing in the third document that merits a Highly Confidential designation.
D. JAI-0004222
The fourth document50 is a three-sentence email from Brady Horton of Nivel
to Sverdlow of JAI, dated January 6, 2026. The subject of the email is Nivel’s open
purchase orders with a battery manufacturer in China. The email attaches an excel
spreadsheet purportedly summarizing purchase orders with the manufacturer, but
only the email was submitted for in camera inspection. The email generally states
only that Nivel’s recent March/April purchase orders had been removed from the
spreadsheet. The email does not provide any detail about the purchase orders in
question.
50 Bates Number JAI-0004222. ECO Capital, Inc. v. Nivel Parts & Manufacturing Co., LLC, et al., C.A. No. 2026-0173-PAF March 1, 2026 Page 19 of 26
Nivel has insisted throughout this litigation that Nivel and JAI are not
affiliates and that Nivel has no ownership interest in JAI.51 If so, then how is the
email about Nivel’s purchase orders with its manufacturer in China Highly
Confidential, when Nivel chose to share it with JAI? The court fails to see how
production of a short transmittal email merely stating that Nivel had canceled an
unspecified number of purchase orders with another entity in January 2026 would
be substantially likely to cause injury to JAI if disclosed to ECO employees who are
deemed, by ECO’s trial counsel, to be reasonably necessary to assist with the
prosecution of the case.52
E. JAI-0003575
The fifth document is an exchange of eight text messages between Art Porter
of JAI and “PB Carts Ormond Beach” on December 3, 2025.53 The participants are
discussing Porter’s recent job interview. Porter indicates that he was at Nivel the
day before, and when the individual at PB Carts Ormond Beach asked “How did it
51 See e.g. Dkt. 6 at 1 (Nivel stating JAI is an “unaffiliated market participant” and JAI’s conduct as “third-party conduct”); id. at 7 (“But after Nivel dispelled ECO’s assumption that JAI was an affiliate or subsidiary of Nivel. . .”); Dkt. 106 24:7–9 (Nivel stated at the first TRO hearing, “JAI is not owned by Nivel. Nivel gets no benefit, generates no revenue from JAI's selling batteries.”); id. at 29:9–10 (Nivel stating “JAI’s not an affiliate of Nivel under Delaware law”). 52 See Confidentiality Order ¶ 7(a). 53 Bates Number JAI-0003576. ECO Capital, Inc. v. Nivel Parts & Manufacturing Co., LLC, et al., C.A. No. 2026-0173-PAF March 1, 2026 Page 20 of 26
go?” Porter responded: “I took the job. Start Feb 1.” Porter’s text message exchange
with a third party about his accepting a new job effective February 1—presumably
with Nivel—is not Highly Confidential JAI information. Its disclosure is not
substantially likely to cause injury to JAI—indeed it was already disclosed to PB
Carts Ormand Beach. Finally, the telephone numbers in the text exchange are
publicly available and easily found through a brief internet search.
F. JAI-0002461
The sixth and final document submitted for in camera review is a short
November 26, 2025, email from Jesse Burson of Nivel to Art Porter of JAI.54 The
email is transmitting the terms of a potential job offer to Porter, which appears
related to the fifth document discussed above. The email contains two pdf
attachments, neither of which was submitted for in camera review. The substance
of the email in its entirety is as follows:
54 Bates Number JAI-0002461. Hi Art,
Please find the role description and compensation structure enclosed.
There are a few specific items that I am sure you want to walk through (how overdrive is calculated), which we can discuss during our meeting shortly.
Looking forward to speaking with you.
It strains credulity to even suggest that an email from Nivel to Porter
transmitting the terms of potential employment is Highly Confidential information
of JAI, the producing party.
* * * *
It is natural in highly expedited litigation for parties to act cautiously and to
be protective of internal corporate information, particularly when competitors are
parties to the case. But a review of the six documents submitted for in camera
inspection shows that JAI chose an overly aggressive approach that it cannot justify
in this case, even considering the highly expedited nature of the dispute. JAI did not
help its cause when it first designated approximately 78% percent of its production
as Highly Confidential. This suggests that JAI chose the Highly Confidential
designation as the default, rather than reviewing documents with a critical eye and
making a good faith determination that the designation was warranted. JAI only
made matters worse when, after two more opportunities to review its earlier
designations, selected a tiny fraction to downgrade from Highly Confidential to ECO Capital, Inc. v. Nivel Parts & Manufacturing Co., LLC, et al., C.A. No. 2026-0173-PAF March 1, 2026 Page 22 of 26
Confidential. Finally, JAI did not improve its position with its proposed
“compromise,” that effectively sought to shift the burden to ECO to demonstrate
which of JAI’s documents should not be designated Highly Confidential. It was not
ECO’s obligation to pick through and identify from among the more than two-
thousand documents designated as Highly Confidential those that JAI would
“consider” reviewing after already having done so three previous times. It is and
was JAI’s responsibility to exercise good faith when designating documents as
Highly Confidential, and JAI bears the burden of establishing that the documents it
designated as Highly Confidential continue to qualify for that treatment.
JAI has designated discovery material as Highly Confidential that is not
worthy of Highly Confidential Treatment under the Confidentiality Order. None of
the six documents submitted for in camera inspection contains Highly Confidential
information, and the court has serious doubt as to any good faith basis to designate
three of them as even worthy of Confidential treatment.
“The Court also ‘has broad discretion in determining the scope of discovery.’”
Handler v. Centerview P’rs Hldgs. L.P., 2023 WL 1955151, at * 2 (Del. Ch. Feb.
13, 2023) (quoting Wei v. Zoox, Inc., 268 A.3d 1207, 1212 (Del. Ch. 2022)). And
has broad discretion to fashion appropriate remedies for violations of a court order
governing discovery. Marshall Fam. Props., LLC v. Fusco, 2026 WL 221459, at *8 ECO Capital, Inc. v. Nivel Parts & Manufacturing Co., LLC, et al., C.A. No. 2026-0173-PAF March 1, 2026 Page 23 of 26
(Del. Ch. Jan. 28, 2026). The appropriate remedy for JAI’s failure to comply with
the terms of the Confidentiality Order is to re-designate all documents listed on
Exhibit 1 to the Joint Letter from Highly Confidential to Confidential. See Klig v.
Deloitte LLP, C.A. No. 4993-VCL (Del. Ch. Aug. 6, 2010) (TRANSCRIPT) (de-
designating all documents on a party’s privilege log due to gross over designation),
interlocutory appeal denied, C.A. No. 569, 2010 (Del. Sept. 27, 2010) (ORDER);
Pfizer, 2004 WL 2323135 at *3 (ordering production of all documents on plaintiff’s
privilege log after in camera review of a sample set of documents submitted by
defendant and finding that those documents were not privileged); Thermo Fisher,
2023 WL 300150 at *9 (stating after in camera review of a sample set of documents,
“[t]he problems with [p]laintiff’s log are so pervasive that I could—and arguably
should—grant [d]efendant’s request for relief [to produce all privileged documents
to defendant without redactions] as to the entirety of [p]laintiff’s log.”); THK Am.,
Inc. v. NSK Co. Ltd., 157 F.R.D. 637, 647 (N.D. Ill. 1993) (ordering “defendants to
de-designate all of the ‘Attorney’s Eyes Only’ documents and reclassify them
‘Confidential’ or ‘Non-confidential’, and to do so forthwith. For defendants there no
longer is any ‘Attorney’s Eyes Only’ classification. They have lost the right to use
the category. For them, the categories are ‘Confidential’ and ‘Non-confidential.’”).
The court is keenly aware of the highly expedited nature of this case and, therefore, ECO Capital, Inc. v. Nivel Parts & Manufacturing Co., LLC, et al., C.A. No. 2026-0173-PAF March 1, 2026 Page 24 of 26
is not imposing the more severe remedy of declaring that none of the challenged
documents even qualifies for Confidential treatment.
G. Attorneys’ Fees and Expenses
ECO is entitled to recover its attorneys’ fees and expenses in litigating the
Motion. “Discovery abuse has no place in [Delaware] courts.” Holt v. Holt, 472
A.2d 820, 824 (Del. 1984) (quoting Delaware Superior Court Civil Rule 1). “Trial
courts should be diligent in the imposition of sanctions upon a party who refuses to
comply with discovery orders, not just to penalize those whose conduct warrants
such sanctions, but to deter those who may be tempted to abuse the legal system by
their irresponsible conduct.” Hoag v. Amex Assurance Co., 953 A.2d 713, 717 (Del.
2008).
Rule 37(b)(4)(A) provides that on a motion to require compliance with a
discovery order, the court “shall require the party . . . or attorney advising such
conduct or both of them to pay to the moving party” reasonable fees and expenses,
including attorneys’ fees. The Delaware Supreme Court has explained that under
Rule 37, “when a party fails to comply with discovery orders of the Court or
otherwise engages in discovery abuses, the award of attorneys’ fees and expenses to
the opposing party is mandatory, absent a showing by the wrongdoer that his actions ECO Capital, Inc. v. Nivel Parts & Manufacturing Co., LLC, et al., C.A. No. 2026-0173-PAF March 1, 2026 Page 25 of 26
were substantially justified or that other circumstances make the award unjust.”
Bader v. Fischer, 504 A.2d 1091, 1096 (Del. 1986) (emphasis added).
JAI has made no showing that its improper designation of documents as
Highly Confidential and failure to correct its violation of the Confidentiality Order
was substantially justified. Nor are there any other circumstances to make the award
of fees unjust.
ECO is awarded and JAI shall be responsible for the expenses ECO has
incurred including attorneys’ fees for bringing the Motion and any actions required
by the Order. If the parties are unable to reach agreement on the amount of fees and
expenses to be paid, then ECO shall file a Rule 88 affidavit outlining the attorneys’
fees and costs it incurred in bringing the Motion and complying with the Order. The
parties shall then submit a stipulated scheduling order to resolve the fee and expense
award.
III. CONCLUSION
For the foregoing reasons, each document designated as Highly Confidential
on Exhibit 1 of the Joint Letter is downgraded from Highly Confidential to
Confidential. ECO is awarded and JAI is ordered to pay the expenses ECO has
incurred, including attorneys’ fees, for bringing the Motion and any actions required
by the court’s Order. ECO Capital, Inc. v. Nivel Parts & Manufacturing Co., LLC, et al., C.A. No. 2026-0173-PAF March 1, 2026 Page 26 of 26
Very truly yours,
/s/ Paul A. Fioravanti, Jr.
Vice Chancellor