Sun Life Assurance Company of Canada v. Wilmington Savings Fund Society, FSB

• Court: Superior Court of Delaware
• Decided: April 12, 2021
• Docket: N18C-08-074 PRW CCLD
• Status: Published

Opinion

IN THE SUPERIOR COURT OF THE STATE OF DELAWARE

SUN LIFE ASSURANCE COMPANY ) OF CANADA, ) Plaintiff, ) ) v. ) ) WILMINGTON SAVINGS FUND SOCIETY, ) FSB, Solely as Securities Intermediary, ) Defendant. ) _____________________________________ ) C.A. No. N18C-08-074 ) PRW CCLD WILMINGTON SAVINGS FUND SOCIETY, ) FSB, Solely as Securities Intermediary, ) Counterclaim-Plaintiff, ) ) v. ) ) SUN LIFE ASSURANCE COMPANY ) OF CANADA, ) Counterclaim-Defendant. )

Submitted: March 31, 2021 Decided: April 12, 2021

ORDER LIFTING STAY, ENTERING DIMISSAL, AND VACATING PREVIOUS ORDER OF DISQUALIFICATION

This 12th day of April, 2021, upon consideration of the parties’ Joint Motion

to Lift Stay and Enter Notice of Dismissal (D.I. 138), the arguments thereon and

supplements thereto (D.I. 143 and 144), the Delaware Supreme Court’s Order entered in In re Appeal of Sunlife Assurance Company of Canada,1 and the record in

this matter, it appears to the Court that:

(1) This contract action between Sun Life Assurance Company of Canada

and the Wilmington Savings Fund Society FSB (“WSFS”) focused on the legality

and enforceability of a life insurance policy that Sun Life had issued and for which

WSFS acted as a securities intermediary.

(2) Because of a prior representation, WSFS moved to disqualify the law

firm Cozen O’Connor as Sun Life’s counsel in this case. The Court granted the

motion, disqualified Cozen O’Connor,2 and later denied Sun Life’s request for

reargument of that disqualification order.3

(3) The Court then certified those two orders for interlocutory appeal,4

which the Delaware Supreme Court accepted.5

1 2021 WL 964894 (Del. Mar. 15, 2021). 2 Sun Life Assur. Co. of Canada v. Wilmington Savings Fund Soc’y, FSB, 2019 WL 6998156, at *8 (Del. Super. Ct. Dec. 19, 2019). 3 Sun Life Assur. Co. of Canada v. Wilmington Savings Fund Soc’y, FSB, 2020 WL 1814758 (Del. Super. Ct. Apr. 9, 2020). 4 Sun Life Assur. Co. of Canada v. Wilmington Savings Fund Soc’y, FSB, 2020 WL 5415830 (Del. Super. Ct. Aug. 5, 2020). 5 In re Appeal of Sunlife Assurance Company of Canada, 2021 WL 964894, at *1.

-2- (4) On the same day the Court certified the disqualification orders for

interlocutory appeal, it entered an order staying further litigation and proceedings

until resolution of that appeal.6

(5) While the interlocutory appeal was pending, the parties to this action

reached a settlement agreement. Sun Life then filed in the Supreme Court both a

notice of voluntary dismissal of its appeal and a motion for vacatur of this Court’s

orders disqualifying Cozen O’Connor and denying reargument of the

disqualification issue.7

(6) The Supreme Court concluded that Cozen O’Connor’s request 8 for

vacatur should be granted. As the appeal became subject to dismissal because of an

event beyond Cozen O’Connor’s control (i.e., the real parties’ settlement), our high

court found that Cozen O’Connor should not be subject to the potential reputational

effect of this Court’s disqualification decision—“particularly in light of th[is] [ ]

Court’s determination that the firm and its attorneys acted with the diligence,

integrity, and vigilance appropriate to the profession.”9 And so, the matter was

6 D.I. 136. 7 In re Appeal of Sunlife Assurance Company of Canada, 2021 WL 964894, at *1. 8 After the parties reached their settlement, Cozen O’Connor was granted leave to intervene in the appeal and to join in the motion for vacatur then pending in the Supreme Court. Id. 9 Id. at 2.

-3- remanded to this Court for the purpose of vacating its December 19, 2019, and April

9, 2020 decisions and orders.10

NOW, THEREFORE, IT IS HEREBY ORDERED that: (a) the STAY

entered on August 5, 2020 (D.I. 136) is hereby LIFTED; (b) the parties’ joint motion

for entry of DISMISSAL (D.I. 138) is GRANTED—all the parties’ remaining

claims and counterclaims in this action are DISMISSED with prejudice with each

party to bear its own costs and attorney’s fees; and (c) the Court’s orders

disqualifying Cozen O’Connor (D.I. 122)11 and denying reargument of the

disqualification issue (D.I. 127)12 are hereby VACATED.

Paul R. Wallace, Judge

Original to Prothonotary cc: All counsel via File & Serve

10 Id.; D.I. 145 (Supreme Court Mandate). 11 Sun Life Assur. Co. of Canada v. Wilmington Savings Fund Soc’y, FSB, 2019 WL 6998156, at *8 (Del. Super. Ct. Dec. 19, 2019). 12 Sun Life Assur. Co. of Canada v. Wilmington Savings Fund Soc’y, FSB, 2020 WL 1814758 (Del. Super. Ct. Apr. 9, 2020).

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