MHS Capital LLC v. Goggin

• Court: Court of Chancery of Delaware
• Decided: May 24, 2018
• Docket: CA No. 2017-0449-SG
• Status: Published

Opinion

COURT OF CHANCERY OF THE SAM GLASSCOCK III STATE OF DELAWARE COURT OF CHANCERY COURTHOUSE VICE CHANCELLOR 34 THE CIRCLE GEORGETOWN, DELAWARE 19947

Date Submitted: May 22, 2018 Date Decided: May 24, 2018

Philip Trainer Jr., Esquire Gregory V. Varallo, Esquire Marie M. Degnan, Esquire Susan M. Hannigan, Esquire Ashby & Geddes Richards, Layton & Finger, P.A. 500 Delaware Avenue, 8th Floor 920 N. King Street Wilmington, Delaware 19899 Wilmington, Delaware 19801

Michael Busenkell, Esquire Geller Scali Busenkell & Brown LLC 1201 N. Orange Street, Suite 300 Wilmington, Delaware 19801

Thomas A. Uebler, Esquire Kerry M. Porter, Esquire McCollom D’Emilio Smith Uebler LLC 1523 Concord Pike, Suite 300 Wilmington, Delaware 19803

Re: MHS Capital LLC v. Goggin et al., Civil Action No. 2017-0449- SG

Dear Counsel:

On May 17, 2018, Defendant Keith Goggin moved for clarification of this

Court’s May 10, 2018 Memorandum Opinion granting in part and denying in part

the Defendants’ Motions to Dismiss.1 Goggin sought clarification on the ground

that the Court “did not address [his] argument that any claim that survives should

1 MHS Capital LLC v. Goggin, 2018 WL 2149718 (Del. Ch. May 10, 2018). at a minimum be dismissed to the extent that plaintiff purports to assert it

individually (and should accordingly proceed only derivatively).”2 On May 22,

Goggin filed a letter with the Court, acknowledging that the Memorandum Opinion

in fact addressed his request to rule that any surviving claim is derivative rather

than direct. As Goggin points out, this Court stated that it “need not decide”

whether any surviving claim is derivative or direct, because even if it held that

such a claim was derivative, “demand would be excused and the claim would

proceed.”3 The Court cited Delaware authority in support of this approach.4

Nevertheless, Goggin argues that “the central premise of his Motion remains

unchanged,” and he continues to seek a ruling on whether the surviving claim for

breach of contract is direct or derivative.5

The Motion is denied. “A motion for clarification may be granted where the

meaning of what the Court has written is unclear, and such a motion is treated,

procedurally, as a motion for reargument under Court of Chancery Rule 59(f).”6

As Goggin now concedes, there is nothing unclear about this Court’s treatment of

2 Mot. for Clarification ¶ 3. 3 MHS Capital LLC, 2018 WL 2149718, at *18 n.203. 4 See Needham v. Cruver, 1993 WL 179336, at *3 (Del. Ch. May 12, 1993) (“This Court need not decide at this point whether plaintiffs’ claims ... are individual or stockholder derivative claims because, even if the claims are derivative claims, a pre-suit demand should be excused.”); Chrysogelos v. London, 1992 WL 58516, at *7 n.8 (Del. Ch. Mar. 25, 1992) (“I need not decide the character of th[e] claim, because even if it is derivative, demand is excused.”). 5 May 22, 2018 Letter to the Court. 6 Naughty Monkey LLC v. MarineMax Northeast LLC, 2011 WL 684626, at *1 (Del. Ch. Feb. 17, 2011). 2 the direct/derivative issue. Where, as here, the meaning of a court’s decision is

clear, a motion for clarification will be denied.7 Moreover, Goggin does not argue

that this Court “overlooked a decision or principle of law that would have

controlling effect or . . . misapprehended the facts or the law so the outcome of the

decision would be different.”8 Accordingly, there is no basis for reargument or

clarification of the Memorandum Opinion.

To the extent the foregoing requires an Order to take effect, IT IS SO

ORDERED.

Sincerely,

/s/ Sam Glasscock III

Sam Glasscock III

7 See In re Oxbow Carbon LLC, 2017 WL 1191903, at *2 (Del. Ch. Mar. 30, 2017) (denying a motion for clarification of a “ruling [that] was clear and unambiguous”). 8 Pontone v. Milso Indus. Corp., 2014 WL 4352341, at *1 (Del. Ch. Sept. 3, 2014). 3