COURT OF CHANCERY OF THE STATE OF DELAWARE BONNIE W. DAVID COURT OF CHANCERY COURTHOUSE VICE CHANCELLOR 34 THE CIRCLE GEORGETOWN, DE 19947
Date Submitted: December 4, 2025 Date Decided: December 19, 2025
Gregory V. Varallo, Esquire Douglas D. Herrmann, Esquire Mae Oberste, Esquire Cassandra L. Thompson, Esquire Bernstein Litowitz Berger & Troutman Pepper Locke LLP Grossmann LLP 1313 Market Street, PO Box 1709 500 Delaware Avenue, Suite 901 Wilmington, DE 19899 Wilmington, DE 19801
RE: Michael O’Neill v. Summit Materials, Inc., C.A. No. 2025-0695-LM (BWD)
Dear Counsel:
This letter opinion resolves exceptions to a Magistrate in Chancery’s post-trial
oral ruling in a books and records action. In her ruling, the Magistrate Judge
concluded that the stockholder plaintiff lacks a proper purpose to inspect books and
records because he already filed a plenary action challenging the same purported
wrongdoing that he seeks to investigate through his demand. For reasons that
follow, the plaintiff’s exceptions are denied and the Magistrate Judge’s final report
denying inspection is adopted. Michael O’Neill v. Summit Materials, Inc., C.A. No. 2025-0695-LM (BWD) December 19, 2025 Page 2 of 14
I. BACKGROUND
The following facts are drawn from the Magistrate in Chancery’s October 1,
2025 post-trial oral final report (the “Final Report”) and the record developed at a
September 23, 2025 trial.1
Prior to February 2025, plaintiff Michael O’Neill (“Plaintiff”) was a
stockholder of Summit Materials, Inc. (“Summit”), a Delaware corporation that
produces and supplies aggregates, cement, ready-mix concrete, asphalt paving mix,
and concrete products; and owns and operates quarries, sand and gravel pits, six
cement plants, cement distribution terminals, ready-mix concrete plants, asphalt
plants, and landfill sites. JX 12 at 2; Pl.’s Opening Br. in Supp. of His Exceptions
to the Magistrate’s Final Report [hereinafter OB] at 8, Dkt. 35.
In January 2024, Summit combined with Argos North America Corp. JX 3 at
1. In that transaction, nonparty Grupo Argos S.A. (“Grupo Argos”), a Colombian
entity, received $1.2 billion in cash and approximately 54.7 million shares of
Summit common stock, representing roughly 31% of the combined entity. JX 4 at
2, 8. At that time, Summit and Grupo Argos entered into a stockholder agreement
1 Tr. of 10-1-2025 Telephonic Report of the Magistrate on Pl.’s Request for Inspection of Books and Rs. [hereinafter Final Report], Dkt. 34. Joint exhibits are cited as “JX __” unless otherwise defined. Michael O’Neill v. Summit Materials, Inc., C.A. No. 2025-0695-LM (BWD) December 19, 2025 Page 3 of 14
under which Grupo Argos obtained certain consent rights and was entitled to
nominate three directors to Summit’s eleven-member board of directors. JX 2 at 4,
14. Summit and Grupo Argos also entered into a restrictive covenant agreement that
prohibited Grupo Argos from competing with Summit within the United States and
parts of Canada for a period of five years (the “Non-Compete”). JX 1 at 2–3.
Less than a year later, on November 24, Summit and nonparty Quikrete
Holdings, Inc. (“Quikrete”) entered into a merger agreement under which Quikrete
agreed to acquire Summit in an all-cash merger for $52.50 per share of Summit
common stock (the “Merger”). Final Report at 4; JX 10 at 2. Grupo Argos agreed
to support the Merger in exchange for Quikrete’s agreement that Summit would
waive the Non-Compete. Final Report at 4; JX 10 at 45–46, 51.
On January 14, 2025, Plaintiff served a books and records demand on
Summit’s board of directors pursuant to 8 Del. C. § 220 (“Section 220”) to
investigate possible wrongdoing in connection with the Merger (the “Demand”).
Final Report at 4; JX 12 at 1. On January 29, Plaintiff and Summit entered into a
Books and Records Access Agreement (the “Standing Agreement”) to preserve
Plaintiff’s standing to seek books and records after the Merger closing. JX 15 at 1.
The Merger closed on February 10. JX 17 at 1. Michael O’Neill v. Summit Materials, Inc., C.A. No. 2025-0695-LM (BWD) December 19, 2025 Page 4 of 14
On February 17, Delaware legislators introduced Senate Bill 21 (“S.B. 21”)
in the Delaware General Assembly, proposing amendments to Sections 144 and 220
of the Delaware General Corporation Law. Del. S.B. 21, 153d Gen. Assem. (2025)
[hereinafter S.B. 21], available at https://legis.delaware.gov/BillDetail/141857. The
amendments to Section 144 define a “[c]ontrolling stockholder” to include a person
that, together with such person’s affiliates and associates,
[h]as the power functionally equivalent to that of a stockholder that owns or controls a majority in voting power of the outstanding stock of the corporation entitled to vote generally in the election of directors by virtue of ownership or control of at least one-third in voting power of the outstanding stock of the corporation entitled to vote generally in the election of directors.
S.B. 21 § 144(e)(2)(b); see also 8 Del. C. § 144(e)(2)(c).
On February 25 (eight days after S.B. 21 was introduced), Plaintiff initiated a
plenary action in this Court, alleging claims for breach of fiduciary duty in
connection with the Merger (the “Plenary Action”). JX 20 at 1, 26–28; see Verified
Class Action Compl., C.A. No. 2025-0209-MTZ, Dkt. 1. Plaintiff filed that action
hoping to outrun the effect of the new legislation. But on March 12, Delaware
legislators introduced Senate Substitute 1 for S.B. 21 in the Delaware General
Assembly, which made clear that the amendments would have retroactive effect for
proceedings commenced after February 17, i.e., the day that S.B. 21 was first Michael O’Neill v. Summit Materials, Inc., C.A. No. 2025-0695-LM (BWD) December 19, 2025 Page 5 of 14
introduced. Del. S. Sub. 1 for S.B. 21, 153d Gen. Assem. (2025), codified at 8 Del.
C. §§ 144, 220, available at https://legis.delaware.gov/BillDetail/141930.
Having failed to circumvent the new statute, Plaintiff dismissed the Plenary
Action without prejudice and turned back to his books and records request. Notice
of Voluntary Dismissal Without Prejudice, C.A. No. 2025-0209-MTZ, Dkt. 12.
Months later, on June 20, Plaintiff initiated the present action seeking to enforce the
Demand. Verified Compl. for Breach of Contract and to Compel Produc. of Books
and Rs. Pursuant to 8 Del. C. § 220, Dkt. 1. The action was assigned to a Magistrate
in Chancery, who held a trial on a paper record on September 23. Dkts. 2, 26. On
October 1, the Magistrate Judge issued her Final Report, denying Plaintiff’s
inspection request. Dkt. 29; Final Report at 15. The Magistrate Judge found that
Plaintiff lacked a proper purpose for inspection, relying on precedent holding that “a
stockholder does not act with a proper purpose when seeking to use Section 220 to
investigate matters that have already been placed at issue in a plenary . . . action.”
Final Report at 7. The Magistrate Judge acknowledged narrow exceptions to that
“general rule,” but concluded that the present facts did not fall into those exceptions,
emphasizing that “[P]laintiff in this instance initiated the problem by rushing to file
a [P]lenary [A]ction” and the “sequence of events” was the result of “[P]laintiff’s
own strategic decisions.” Id. at 9, 11. Michael O’Neill v. Summit Materials, Inc., C.A. No. 2025-0695-LM (BWD) December 19, 2025 Page 6 of 14
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COURT OF CHANCERY OF THE STATE OF DELAWARE BONNIE W. DAVID COURT OF CHANCERY COURTHOUSE VICE CHANCELLOR 34 THE CIRCLE GEORGETOWN, DE 19947
Date Submitted: December 4, 2025 Date Decided: December 19, 2025
Gregory V. Varallo, Esquire Douglas D. Herrmann, Esquire Mae Oberste, Esquire Cassandra L. Thompson, Esquire Bernstein Litowitz Berger & Troutman Pepper Locke LLP Grossmann LLP 1313 Market Street, PO Box 1709 500 Delaware Avenue, Suite 901 Wilmington, DE 19899 Wilmington, DE 19801
RE: Michael O’Neill v. Summit Materials, Inc., C.A. No. 2025-0695-LM (BWD)
Dear Counsel:
This letter opinion resolves exceptions to a Magistrate in Chancery’s post-trial
oral ruling in a books and records action. In her ruling, the Magistrate Judge
concluded that the stockholder plaintiff lacks a proper purpose to inspect books and
records because he already filed a plenary action challenging the same purported
wrongdoing that he seeks to investigate through his demand. For reasons that
follow, the plaintiff’s exceptions are denied and the Magistrate Judge’s final report
denying inspection is adopted. Michael O’Neill v. Summit Materials, Inc., C.A. No. 2025-0695-LM (BWD) December 19, 2025 Page 2 of 14
I. BACKGROUND
The following facts are drawn from the Magistrate in Chancery’s October 1,
2025 post-trial oral final report (the “Final Report”) and the record developed at a
September 23, 2025 trial.1
Prior to February 2025, plaintiff Michael O’Neill (“Plaintiff”) was a
stockholder of Summit Materials, Inc. (“Summit”), a Delaware corporation that
produces and supplies aggregates, cement, ready-mix concrete, asphalt paving mix,
and concrete products; and owns and operates quarries, sand and gravel pits, six
cement plants, cement distribution terminals, ready-mix concrete plants, asphalt
plants, and landfill sites. JX 12 at 2; Pl.’s Opening Br. in Supp. of His Exceptions
to the Magistrate’s Final Report [hereinafter OB] at 8, Dkt. 35.
In January 2024, Summit combined with Argos North America Corp. JX 3 at
1. In that transaction, nonparty Grupo Argos S.A. (“Grupo Argos”), a Colombian
entity, received $1.2 billion in cash and approximately 54.7 million shares of
Summit common stock, representing roughly 31% of the combined entity. JX 4 at
2, 8. At that time, Summit and Grupo Argos entered into a stockholder agreement
1 Tr. of 10-1-2025 Telephonic Report of the Magistrate on Pl.’s Request for Inspection of Books and Rs. [hereinafter Final Report], Dkt. 34. Joint exhibits are cited as “JX __” unless otherwise defined. Michael O’Neill v. Summit Materials, Inc., C.A. No. 2025-0695-LM (BWD) December 19, 2025 Page 3 of 14
under which Grupo Argos obtained certain consent rights and was entitled to
nominate three directors to Summit’s eleven-member board of directors. JX 2 at 4,
14. Summit and Grupo Argos also entered into a restrictive covenant agreement that
prohibited Grupo Argos from competing with Summit within the United States and
parts of Canada for a period of five years (the “Non-Compete”). JX 1 at 2–3.
Less than a year later, on November 24, Summit and nonparty Quikrete
Holdings, Inc. (“Quikrete”) entered into a merger agreement under which Quikrete
agreed to acquire Summit in an all-cash merger for $52.50 per share of Summit
common stock (the “Merger”). Final Report at 4; JX 10 at 2. Grupo Argos agreed
to support the Merger in exchange for Quikrete’s agreement that Summit would
waive the Non-Compete. Final Report at 4; JX 10 at 45–46, 51.
On January 14, 2025, Plaintiff served a books and records demand on
Summit’s board of directors pursuant to 8 Del. C. § 220 (“Section 220”) to
investigate possible wrongdoing in connection with the Merger (the “Demand”).
Final Report at 4; JX 12 at 1. On January 29, Plaintiff and Summit entered into a
Books and Records Access Agreement (the “Standing Agreement”) to preserve
Plaintiff’s standing to seek books and records after the Merger closing. JX 15 at 1.
The Merger closed on February 10. JX 17 at 1. Michael O’Neill v. Summit Materials, Inc., C.A. No. 2025-0695-LM (BWD) December 19, 2025 Page 4 of 14
On February 17, Delaware legislators introduced Senate Bill 21 (“S.B. 21”)
in the Delaware General Assembly, proposing amendments to Sections 144 and 220
of the Delaware General Corporation Law. Del. S.B. 21, 153d Gen. Assem. (2025)
[hereinafter S.B. 21], available at https://legis.delaware.gov/BillDetail/141857. The
amendments to Section 144 define a “[c]ontrolling stockholder” to include a person
that, together with such person’s affiliates and associates,
[h]as the power functionally equivalent to that of a stockholder that owns or controls a majority in voting power of the outstanding stock of the corporation entitled to vote generally in the election of directors by virtue of ownership or control of at least one-third in voting power of the outstanding stock of the corporation entitled to vote generally in the election of directors.
S.B. 21 § 144(e)(2)(b); see also 8 Del. C. § 144(e)(2)(c).
On February 25 (eight days after S.B. 21 was introduced), Plaintiff initiated a
plenary action in this Court, alleging claims for breach of fiduciary duty in
connection with the Merger (the “Plenary Action”). JX 20 at 1, 26–28; see Verified
Class Action Compl., C.A. No. 2025-0209-MTZ, Dkt. 1. Plaintiff filed that action
hoping to outrun the effect of the new legislation. But on March 12, Delaware
legislators introduced Senate Substitute 1 for S.B. 21 in the Delaware General
Assembly, which made clear that the amendments would have retroactive effect for
proceedings commenced after February 17, i.e., the day that S.B. 21 was first Michael O’Neill v. Summit Materials, Inc., C.A. No. 2025-0695-LM (BWD) December 19, 2025 Page 5 of 14
introduced. Del. S. Sub. 1 for S.B. 21, 153d Gen. Assem. (2025), codified at 8 Del.
C. §§ 144, 220, available at https://legis.delaware.gov/BillDetail/141930.
Having failed to circumvent the new statute, Plaintiff dismissed the Plenary
Action without prejudice and turned back to his books and records request. Notice
of Voluntary Dismissal Without Prejudice, C.A. No. 2025-0209-MTZ, Dkt. 12.
Months later, on June 20, Plaintiff initiated the present action seeking to enforce the
Demand. Verified Compl. for Breach of Contract and to Compel Produc. of Books
and Rs. Pursuant to 8 Del. C. § 220, Dkt. 1. The action was assigned to a Magistrate
in Chancery, who held a trial on a paper record on September 23. Dkts. 2, 26. On
October 1, the Magistrate Judge issued her Final Report, denying Plaintiff’s
inspection request. Dkt. 29; Final Report at 15. The Magistrate Judge found that
Plaintiff lacked a proper purpose for inspection, relying on precedent holding that “a
stockholder does not act with a proper purpose when seeking to use Section 220 to
investigate matters that have already been placed at issue in a plenary . . . action.”
Final Report at 7. The Magistrate Judge acknowledged narrow exceptions to that
“general rule,” but concluded that the present facts did not fall into those exceptions,
emphasizing that “[P]laintiff in this instance initiated the problem by rushing to file
a [P]lenary [A]ction” and the “sequence of events” was the result of “[P]laintiff’s
own strategic decisions.” Id. at 9, 11. Michael O’Neill v. Summit Materials, Inc., C.A. No. 2025-0695-LM (BWD) December 19, 2025 Page 6 of 14
Plaintiff filed exceptions to the Final Report on October 1. Dkt. 28. Briefing
was completed on December 4. Dkts. 35–36, 38. Oral argument is unnecessary.
II. ANALYSIS
I have reviewed the trial record and the Magistrate in Chancery’s
determinations de novo. DiGiacobbe v. Sestak, 743 A.2d 180, 184 (Del. 1999).
Good cause does not exist to expand the record. See Ct. Ch. R. 144(e).
“To inspect books and records under Section 220, a plaintiff must establish
by a preponderance of the evidence that the plaintiff is a stockholder, has complied
with the statutory form and manner requirements for making a demand, and has a
proper purpose for conducting the inspection.” Pettry v. Gilead Scis., Inc., 2020 WL
6870461, at *9 (Del. Ch. Nov. 24, 2020). “If a stockholder meets these requirements,
the stockholder must then establish ‘that each category of the books and records
requested is essential and sufficient to the stockholder’s stated purpose.’” Id.
(quoting Thomas & Betts Corp. v. Leviton Mfg. Co., 681 A.2d 1026, 1035 (Del.
1996)). “In other words, the court must give the petitioner everything that is
‘essential,’ but stop at what is ‘sufficient.’” KT4 P’rs LLC v. Palantir Techs. Inc.,
203 A.3d 738, 751–52 (Del. 2019) (citation omitted).
As the Magistrate in Chancery explained in her Final Report, “Delaware
courts have recognized that a stockholder who files a plenary action asserting claims Michael O’Neill v. Summit Materials, Inc., C.A. No. 2025-0695-LM (BWD) December 19, 2025 Page 7 of 14
of mismanagement undercuts his alleged need to obtain documents under Section
220 to investigate the same alleged acts of mismanagement.” Schnatter v. Papa
John’s Int’l, Inc., 2019 WL 194634, at *11 (Del. Ch. Jan. 15, 2019), abrogated in
part on other grounds by Tiger v. Boast Apparel, Inc., 214 A.3d 933 (Del. 2019).
When a stockholder files a plenary action challenging the same issues he seeks to
investigate through his demand, he “effectively concede[s] that the books and
records he seeks are not necessary or essential to his stated purpose of investigating
mismanagement or wrongdoing.” Bizzari v. Suburban Waste Servs., Inc., 2016 WL
4540292, at *6 (Del. Ch. Aug. 30, 2016); see also, e.g., King v. VeriFone Hldgs.,
Inc., 12 A.3d 1140, 1148 (Del. 2011) (acknowledging that dismissal of a later-filed
Section 220 action was proper when the “stockholder-plaintiff’s plenary derivative
complaint was still pending and the plenary court had not granted the plaintiff leave
to amend”); An v. Archblock, Inc., 2023 WL 7320253, at *3 (Del. Ch. Nov. 7, 2023)
(holding that “the 220 Complaint must be dismissed as a matter of law because
[p]laintiff has already filed a plenary action challenging the same purported
wrongdoing that he seeks to investigate through the [d]emand”), R. & R. adopted,
2024 WL 1365983 (Del. Ch. Apr. 1, 2024); CHC Invs., LLC v. FirstSun Cap.
Bancorp, 2019 WL 328414, at *5 (Del. Ch. Jan. 24, 2019) (recognizing that absent
“special circumstances, the problems inherent in parallel plenary and Section 220 Michael O’Neill v. Summit Materials, Inc., C.A. No. 2025-0695-LM (BWD) December 19, 2025 Page 8 of 14
actions defeat [a plaintiff’s] purpose for inspection”); Cent. Laborers Pension Fund
v. News Corp., 2011 WL 6224538, at *2 (Del. Ch. Nov. 30, 2011) (concluding that
a stockholder was “unable to tender a proper purpose for pursuing its efforts to
inspect” books and records because its “currently-pending derivative action
necessarily reflect[ed] its view that it had sufficient grounds for alleging both
demand futility and its substantive claims without the need for the assistance
afforded by Section 220”), aff’d, 45 A.3d 139 (Del. 2012); Baca v. Insight Enters.,
Inc., 2010 WL 2219715, at *4 (Del. Ch. June 3, 2010) (“[A] stockholder does not
act with a proper purpose when the stockholder attempts to use Section 220 to
investigate matters that the same stockholder already put at issue in a plenary
derivative action.”); Taubenfeld v. Marriott Int’l, Inc., 2003 WL 22682323, at *3
(Del. Ch. Oct. 28, 2003) (explaining that filing a derivative action “was a
certification under Rule 11 that the plaintiffs had enough information to support their
allegations”).
Plaintiff raises three primary arguments on exceptions. First, Plaintiff
contends that the numerous cases cited above were all implicitly overruled by the
Delaware Supreme Court’s 2020 decision in AmerisourceBergen Corp. v. Lebanon
County Employees’ Retirement Fund, 243 A.3d 417 (Del. 2020). OB at 33. In
AmerisourceBergen, the Supreme Court clarified that when a stockholder states a Michael O’Neill v. Summit Materials, Inc., C.A. No. 2025-0695-LM (BWD) December 19, 2025 Page 9 of 14
proper purpose for inspection by demonstrating a credible basis to investigate
possible wrongdoing, he is not required to “state in the demand all of the ways [he]
might use the documents uncovered in the investigation.”2 AmerisourceBergen, 243
A.3d at 429. AmerisourceBergen further held that a stockholder pursuing an
investigation is not required to “demonstrate that the wrongdoing or mismanagement
[will be] actionable” in a lawsuit,3 since the stockholder may “use the information
obtained for more than one purpose.” Id. at 431. AmerisourceBergen did not,
however, upend well-worn case law explaining that a stockholder who files a plenary
lawsuit challenging alleged misconduct has certified that the information he already
has is sufficient for his purpose, such that he has no further need for books and
records to investigate the same alleged misconduct.
2 Plaintiff seems to suggest that under AmerisourceBergen, even if a stockholder has sufficient information to bring a lawsuit, he may need additional information to pursue other ends of his investigation. See OB at 36. Without foreclosing the possibility that this could be true under different facts, it is not the case here, where Plaintiff seeks to investigate a Merger post-closing. He identifies no conceivable “end” for his inspection other than filing a lawsuit, which he has already done. 3 Plaintiff conflates actionability with proper purpose. AmerisourceBergen’s holding that “[t]he stockholder need not demonstrate that the alleged mismanagement or wrongdoing is actionable” is entirely consistent with the Magistrate Judge’s ruling, supported by case law, that “post-plenary demands undermine the stockholder’s” proper purpose for seeking books and records. 243 A.3d at 437; Final Report at 7–8. The filing of a plenary case is not the type of “merits-based defense” that ordinarily should not be considered in a Section 220 action because it “interferes with” the summary nature of the proceeding. AmerisourceBergen, 243 A.3d at 437. Michael O’Neill v. Summit Materials, Inc., C.A. No. 2025-0695-LM (BWD) December 19, 2025 Page 10 of 14
Second, Plaintiff argues that even if the decisions cited above remain good
law, the present facts are exceptional and support a different outcome. OB at 38.
“Despite problems inherent in the sue first, ask questions later sequence, in special
circumstances, Delaware courts have enforced a stockholder’s Section 220 rights
notwithstanding the stockholder’s pending plenary complaint.” CHC Invs., 2019
WL 328414, at *3 (internal quotation marks omitted). Plaintiff relies on two cases
presenting “special circumstances”—King v. VeriFone Holdings, Inc. and Khanna
v. Covad Communications Group, Inc. The Magistrate Judge correctly concluded
that the narrow exceptions recognized in those cases are inapplicable here.
In King, a stockholder plaintiff filed a plenary action in California federal
court. 12 A.3d at 1141. The California court dismissed the claims with leave to re-
plead and encouraged the plaintiff to demand books and records to improve his
complaint. Id. at 1150. The Delaware Supreme Court upheld the plaintiff’s right to
inspection, explaining that “it is a proper purpose under Section 220 to inspect books
and records that would aid the plaintiff in pleading demand futility in a to-be-
amended complaint in a plenary derivative action, where the earlier-filed plenary
complaint was dismissed on demand futility-related grounds without prejudice and
with leave to amend.” Id. But “[i]t was, in [King], the judicial determination that
the allegations were not sufficient coupled with the judicially-granted leave to Michael O’Neill v. Summit Materials, Inc., C.A. No. 2025-0695-LM (BWD) December 19, 2025 Page 11 of 14
amend that eliminated the inconsistency that one may find in the simultaneous filing
of two related actions, as happened here.” News Corp., 2011 WL 6224538, at *1.
By contrast, here, while Plaintiff chose to dismiss the Plenary Action, “no judicial
action . . . occurred that would suggest a need or a reason for further pleadings or
efforts to gather important facts to support a cognizable purpose for an inspection of
[Summit]’s books and records.” Id. (emphasis added).
In Khanna, a stockholder plaintiff filed suit to enforce his inspection rights
under Section 220, then one month later, brought a class and derivative action out of
concern that his claims would become time-barred. 2004 WL 187274, at *1, *3
(Del. Ch. Jan. 23, 2004). The Court concluded that the plaintiff had not waived his
right to pursue his demand, explaining that “the overlap of the Section 220 action
and the Derivative Action [had been] attributable to [the defendant’s] failure to
comply with its obligations under Section 220.” Id. at *4. Unlike in Khanna,
Summit’s supposed delay in producing books and records did not cause Plaintiff to
run up against a statute of limitations, prejudicing Plaintiff’s rights.4 Whatever
4 Summit also accommodated Plaintiff with the Standing Agreement, which gave Plaintiff a contractual right to pursue books and records after the Merger closing extinguished Plaintiff’s statutory standing. Michael O’Neill v. Summit Materials, Inc., C.A. No. 2025-0695-LM (BWD) December 19, 2025 Page 12 of 14
“pressure” Plaintiff may have felt to pursue the Plenary Action while legislation was
pending, Summit was not responsible for it.
Alternatively, Plaintiff argues that the facts of this case present special
circumstances justifying a new exception to the general rule precluding a
stockholder from seeking books and records after filing a plenary suit. I agree with
the Magistrate Judge that a departure from our existing case law is unwarranted.
Plaintiff argues that the law changed after he filed his Plenary Action, so any
concession that “he had enough information to state a claim under the [old law]
. . . does not mean that Plaintiff has conceded that he has enough information today.”
OB at 40–41; RB at 15. Plaintiff says he was “comfortable that he could state a
claim under the then-applicable law based on the publicly available facts and
applicable law,” but he is no longer so confident. OB at 4. Yet Plaintiff does not
explain why a codification of the definition of a controlling stockholder requires
further factual investigation into the Merger now, when he concluded that the public
record was sufficient to investigate possible breaches of fiduciary duty previously.5
5 Plaintiff asserts that “[u]nder the law that governed at the time, these facts would likely have established Grupo Argos as the Company’s controlling stockholder.” OB at 4, 40. That is perhaps not as self-evident as Plaintiff suggests, given that Grupo Argos held just 31% of the company’s voting power and appointed only three of eleven directors to the board. See Turnbull v. Klein, 2025 WL 353877, at *10 (Del. Ch. Jan. 31, 2025) (“Pleading actual control is ‘no easy task.’” (quoting Larkin v. Shah, 2016 WL 4485447, at *13 (Del. Michael O’Neill v. Summit Materials, Inc., C.A. No. 2025-0695-LM (BWD) December 19, 2025 Page 13 of 14
Plaintiff argues that “[i]t would have been malpractice” not to pursue the
Plenary Action before the statutory amendments took effect because Grupo Argos
held less than one-third of Summit’s voting power. See OB at 4. Plaintiff’s litigation
strategy was his own. By choosing to pursue the Plenary Action, he forwent books
and records. His sophisticated counsel no doubt knew that was the choice they were
making.
Finally, Plaintiff asserts that the Magistrate Judge overlooked the Standing
Agreement, which separately preserved his right to books and records. OB at 31.
This argument was not fairly presented to the Magistrate Judge, and in any event
fails on the merits. The Standing Agreement preserved Plaintiff’s standing to seek
books and records after the Merger closing by contractually replicating his statutory
inspection right:6
Ch. Aug. 25, 2016))); see also, e.g., Flannery v. Genomic Health, Inc., 2021 WL 3615540, at *14 (Del. Ch. Aug. 16, 2021) (concluding that a complaint did not adequately allege that a 25% stockholder that appointed only two of eight directors was a controller); Larkin, 2016 WL 4485447, at *14–15 (concluding that a complaint did not adequately allege that a 23.1% stockholder affiliated with three of nine directors was a controller); In re Morton’s Rest. Gp., Inc. S’holders Litig., 74 A.3d 656, 665 (Del. Ch. 2013) (concluding that a complaint did not adequately allege that a 27.7% stockholder affiliated with two of ten directors was a controller). 6 See In re Zendesk, Inc. Section 220 Litig., 2023 WL 5496485, at *7 n.76 (Del. Ch. Aug. 25, 2023) (noting that analyzing inspection rights under Section 220 or a standing agreement leads to the same result), R. & R. adopted, (Del. Ch. 2023). Michael O’Neill v. Summit Materials, Inc., C.A. No. 2025-0695-LM (BWD) December 19, 2025 Page 14 of 14
The Company agrees that, for the period of one year after the execution of this Agreement, Stockholder shall continue to have the same right, power, and ability to enforce the Demand as Stockholder had prior to the closing of the [Merger]. In connection with any such lawsuit asserted by Stockholder during that one-year time frame, the Company shall not argue or present any defense that Stockholder lacks standing to enforce the Demand following the closing of the [Merger]; provided, however, that the Company reserves all arguments in opposition to any further production under 8 Del. C. § 220.
JX 15 at 2 (emphasis omitted). Nowhere in the Standing Agreement did Summit
waive its right to argue that Plaintiff lacked a proper purpose for seeking books and
records based on his later decision to pursue a plenary action.
III. CONCLUSION
After de novo review, I am satisfied that Plaintiff’s exceptions should be
denied and that the Final Report must be adopted.
Sincerely,
/s/ Bonnie W. David
Bonnie W. David Vice Chancellor
cc: All counsel of record (by File & ServeXpress)