The Delaware Court of Chancery has ordered Morris, Nichols, Arsht & Tunnell to turn over additional documents to two former clients embroiled in a dispute over control of a New York-based technology-services firm.

Vice Chancellor J. Travis Laster on Monday granted Philippe Buhannic's request that the Wilmington law firm produce the full litigation file from an ongoing lawsuit that has resulted in Buhannic's ouster as the CEO and chairman of TradingScreen Inc.

The ruling came after Morris Nichols had turned over just a portion of its file for Buhannic and his brother Patrick Buhannic, citing concerns of attorney-client privilege stemming from the underlying matter. The Buhannics, who were not represented by an attorney, had asked Laster to “penalize” the firm for previously incomplete production, though they did not specify what they thought the sanction should be.

In a 19-page memorandum opinion, Laster said the Buhannics were entitled to their entire litigation file, but declined to impose any kind of sanction against Morris Nichols, saying the firm had reasonably complied with an earlier production order.

“Morris Nichols' conduct has not tainted the fairness of this proceeding,” he wrote. “The case is currently stayed, and Morris Nichols took a reasonable position in response to the Buhannics' request.”

The dispute with Morris Nichols arose out of a 2014 investor lawsuit accusing TradingScreen of failing to redeem their preferred stock. The two private equity firms had also accused the Buhannics and two other directors, Piero Grandi and Pierre Schroeder of acting in bad faith to determine that TradingScreen had enough money to only redeem a portion of their stock.

During post-trial briefing, a majority of the TradingScreen board placed Philippe Buhannic on leave and filed in the Court of Chancery to determine Buhannic's status as CEO and the proper composition of the company's board.

Meanwhile, Morris Nichols, which represented all of the TradingScreen directors in the original suit, withdrew as counsel, just before the parties reached an agreement in principle to settle the case. Laster has since stayed the case.

Buhannic objected to the settlement last April and asserted for the first time that Morris Nichols had refused to turn over its litigation file.

Morris Nichols responded that the other defendants had asserted attorney-client privilege over the materials, but in December produced more than 5,000 documents after Laster granted Buhannic's motion to compel.

However, dissatisfied with the production, Buhannic demanded all of the files in the attorneys' possession. Morris Nichols countered that it had satisfied Laster's order and argued that Buhannic only wanted a copy of the agreement to settle, which the firm said it does not have.

Laster acknowledged that there was a lack of guidance addressing the scope of the materials that former counsel must produce to a former client upon request. In his ruling, he said that Delaware law and the facts of the case supported the “entire-file” approach, which makes no distinctions between a lawyers' internal or external work product.

“The entire-file approach best comports with an attorney's heightened duties to his or her clients and the candor and transparency that characterize the attorney-client relationship,” Laster said.

“Morris Nichols did not produce its entire litigation file. Because this decision has adopted the entire-file approach, Morris Nichols shall produce its entire litigation file.”

Morris Nichols partner Kenneth J. Nachbar, who formerly represented Buhannic and the TradingScreen defendants, did not return a call Tuesday seeking comment on the ruling.

The case is captioned TCV VI v. TradingScreen.