Vice Chancellor Sam Glasscock.

A Delaware Court of Chancery judge on Monday refused Energy Transfer Equity's bid for a second chance at claiming a nearly $1.5 billion break-up fee stemming from the pipeline company's failed merger with The Williams Cos. Inc.

In December, Vice Chancellor Sam Glasscock III rejected ETE's ”unlikely position” that it was entitled to liquidated damages after successfully petitioning the court in 2016 to walk away from the deal, once valued at $33 million, over a tax issue. Dallas-based ETE later moved for reargument, saying the Williams board had quietly tried to sabotage the deal and then worked to make sure that it was never consummated.

But Glasscock noted that Tulsa, Oklahoma-based Williams had fulfilled all of its contractual duties to close the merger and never explicitly withdrew or threatened to undo the deal.

ETE's position, he said, would lead to an “impractical solution” that holds a board liable for the same amount of liquidated damages as if it had withdrawn its recommendation and actively tried to torpedo the deal.

“In other words, actions by Williams that led to a consummated transaction leave it liable as though it had withdrawn from the transaction. This is a nonsensical reading of the language of the merger agreement, and is not consistent with the language the parties themselves chose,” Glasscock wrote.

In June 2016, Glasscock ruled in the high-stakes, expedited litigation that ETE did not violate a merger agreement by invoking a tax flaw that ultimately sunk the deal, even though the company's lawyers had previously approved the transaction.

The Delaware Supreme Court affirmed Glasscock's decision by a 4-1 vote in March over the strong dissent of the court's chief justice, who questioned ETE's motives for scuttling the deal.

Monday's ruling came amid a heated court battle in Georgetown, as both sides tried to lay claim to $1.48 billion in breakup fees and other damages. Williams, which had asked Glasscock to enforce the merger agreement, filed for damages in September 2016, sparking a flurry of counterclaims from ETE.

ETE's most serious charge came on its assertions that the Williams board had launched a public campaign to undermine the deal and investor confidence in ETE and chairman Kelcy Warren in order to claim the termination fee.

The company pointed to press releases and public statements that, ETE said, showed the Williams directors had soured on the deal after a downturn in the energy market, as well as a lawsuit Williams had filed against ETE chairman and CEO Warren in Texas, accusing the executive of exploiting his leadership position with the firm.

ETE, which lost its campaign to enforce the merger agreement, had made similar claims in the Court of Chancery, accusing ETE of “sabotage” and “fabrication.”

Williams is represented by Sandra C. Goldstein, Antony L. Ryan and Kevin J. Orsini of Cravath, Swaine & Moore and Kenneth J. Nachbar and Zi-Xiang Shen of Morris, Nichols, Arsht & Tunnell.

ETE is represented by Michael C. Holmes, John C. Wander, Michael L. Charlson and Craig E. Zieminski of Vinson & Elkins and Rolin P. Bissell, Tammy L. Mercer and James M. Yoch of Young Conaway Stargatt & Taylor.

The case is captioned Williams v. Energy Transfer Equity.