Mark E Felger

October 09, 2013 | Delaware Business Court Insider

The Delaware General Corporation Law, like the business corporation law of most states, provides in Section 223(a) that vacancies on a corporate board can be filled through appointment of new directors by the existing directors unless the certificate of incorporation or bylaws provide otherwise. However, unlike the corporation law in other states, Section 223(c) of the DGCL allows stockholders in certain circumstances to petition the Court of Chancery to direct that a special stockholders' meeting take place in order to fill the vacancies through a stockholder vote.

By Barry M. Klayman and Mark E. Felger

6 minute read

September 11, 2013 | Delaware Business Court Insider

It is not often that the Delaware Supreme Court rejects the specific arguments advanced by an appellant and then decides the matter in the party's favor on grounds not asserted by that party but considered sua sponte by the court. Such was the case in Levey v. Brownstone Asset Management, LP, No. 551, 2012 (Del. Aug. 27, 2013), wherein the court reversed the decision of the Court of Chancery and remanded for further proceedings "in the interest of justice."

By Barry M. Klayman and Mark E. Felger

7 minute read

September 11, 2013 | Delaware Business Court Insider

It is not often that the Delaware Supreme Court rejects the specific arguments advanced by an appellant and then decides the matter in the party's favor on grounds not asserted by that party but considered sua sponte by the court.

By Barry M. Klayman and Mark E. Felger

8 minute read

August 14, 2013 | Delaware Business Court Insider

Two recent bankruptcy cases decided on the same day by the same judge dealt with motions to amend the complaints in preference actions. Both cases illustrate the court's application of the relation-back doctrine, with differing results. Along the way, the court addressed the requirements for proper service and equitable tolling of the statute of limitations.

By Barry M. Klayman and Mark E. Felger

8 minute read

July 10, 2013 | Delaware Business Court Insider

The Worker Adjustment and Retraining Notification Act (WARN Act) provides that an employer may not order a plant closing or mass layoff until the end of a 60-day period after the employer serves written notice of such an order to each affected employee. The purpose of the act is to protect workers and their families by providing them with advance notice of a layoff. Because employee layoffs are a necessary condition to WARN Act liability, and layoffs frequently presage a corporation's demise, plaintiffs frequently attempt to recover from affiliates like a parent company or lender. Two recent decisions from the Delaware bankruptcy and district courts illustrate how the courts deal with such suits.

By Barry M. Klayman and Mark E. Felger

9 minute read

June 12, 2013 | Delaware Business Court Insider

On March 28, 2012, we wrote about a bankruptcy court decision voiding a nondebtor parent company's revocation of its own S corporation status, which had the effect of terminating its debtor subsidiary's "qualified Subchapter S subsidiary" (QSub) status, as an unlawful transfer of the debtor subsidiary's property in violation of Sections 362 and 549 of the Bankruptcy Code.

By Barry M. Klayman and Mark E. Felger

10 minute read

May 08, 2013 | Delaware Business Court Insider

A recent Chancery Court decision underscores the broad scope of a director's right to information, even where he is a plaintiff in litigation action against the corporation. In Kalisman v. Friedman, C.A. No. 8447-VCL (Del. Ch. Apr. 17, 2013), the court held that a corporation could not assert the attorney-client privilege or work-product doctrine to withhold documents from a director who had been frozen out of the deliberative process on a controversial recapitalization plan.

By Barry M. Klayman and Mark E. Felger

8 minute read

December 12, 2012 | Delaware Business Court Insider

In what the court characterized as an apparent matter of first impression, U.S. Bankruptcy Judge Christopher S. Sontchi of the District of Delaware considered what legal standard applies in a Chapter 15 case to a transfer of assets located in the United States pursuant to a "global" transaction previously approved by another court in a foreign main proceeding. In In re Elpida Memory , Case No. 12-10947(CSS) (D. Del. Bankr. Nov. 20, 2012), the court held, based upon the plain meaning of the statute and its legislative history, that it must review the transaction to the extent it impacts assets in the United States under the legal standards governing a transfer by a trustee outside the ordinary course of business, i.e., whether the transaction is a sound exercise of the trustee's business judgment. In so doing, Sontchi rejected the argument of the foreign representatives that, to the extent that the non-U.S. court in the foreign main proceeding authorized the transfer of assets over which it had shared jurisdiction, the U.S. court was required to grant comity to the orders of that court and to approve the application of the foreign representatives without more.

By Barry M. Klayman and Mark E. Felger

7 minute read

January 18, 2012 | Delaware Business Court Insider

On Dec. 20, Judge Christopher S. Sontchi in In re USDigital Inc. became the first Delaware bankruptcy judge to set forth his views on the meaning and significance of the Supreme Court's decision in Stern v. Marshall . Sontchi's opinion is significant because it construes the Stern decision very narrowly and signals to the bankruptcy bar that the court will continue to protect its judicial authority to enter final orders.

By Barry M. Klayman and Mark E. Felger Special to the DBCI

6 minute read

August 15, 2012 | Delaware Business Court Insider

It is common practice in Chancery Court cases to enter into a stipulated confidentiality order permitting the parties to designate certain documents as confidential and to limit their disclosure and use by the parties in the pending litigation.

By Barry M. Klayman and Mark E. Felger Special to the DBCI

5 minute read