The Delaware Court of Chancery on Wednesday appointed a monitor to oversee the sale of Oxbow Carbon and ordered CEO William Koch to pay tens of millions of dollars in damages to two private equity firms for derailing a deal for the energy company in 2016.

The order from Vice Chancellor J. Travis Laster followed a post-trial opinion in February, which found Koch had improperly denied Crestview Partners and Load Line Capital their right as investors to seek an exit sale under Oxbow's LLC agreement. According to Wednesday's ruling, Koch will have to cover the investor's expenses for lawyers and deal advisers and make up any lost value resulting from the delay.

The ultimate tally of damages would depend on how much the company sells for, Laster said; however, the exit sale must generate at least $2.65 billion in value.

“The minority members bargained for the right to exit their investment after seven years, without a minority discount. By breaching the reasonable efforts clause, the Koch parties deprived them of this right,” Laster wrote in a 45-page memorandum opinion.

Laster also took the unusual step of appointing a monitor to ensure Oxbow's compliance with the ruling, as one of the world's largest producers of petroleum coke heads back to the auction block. Oxbow, he said, would bear the cost of the court-appointed agent, who will have “expansive informational rights.”

The monitor will be responsible for supervising the sale process but will not have the power to enforce the order directly, Laster said.

“Crestview is very pleased with Vice Chancellor Laster's well-reasoned and thorough opinion directing an exit sale of Oxbow Carbon and awarding damages,” said Michael Carlinsky, a New York-based partner in Quinn Emanuel Urquhart & Sullivan, who headed Crestview's legal team.

Attorneys for Koch and Oxbow did not immediately respond Thursday to calls seeking comment on the decision.

Laster's ruling sets the stage for Oxbow's sale within a year, and it resolves more than two years of messy litigation in Chancery Court, where Koch had accused Crestview and Load Line of conspiring to force him out of Oxbow in order to force a quick sale as commodities prices tanked. William Koch is the brother of billionaires and conservative political activists Charles and David Koch.

Laster rejected those claims in February, finding that it was Koch who did not follow proper formalities after attracting the investments and later failed to meet his contractual duties to use reasonable efforts to support the sale.

However, the case also features wide-ranging allegations of wrongdoing, including assertions from Koch that Crestview had planted a “mole” on the Oxbow board to spy on him and pressure him to resign.

According to court documents, Koch even went so far as to install cameras at company facilities and even hired private investigators to help build his case against Crestview. Surveillance records and other information were turned over to the investors in discovery.

On Wednesday, Laster said the appointment of a monitor would allow the court to remain informed about the progress of the sale, but it would also serve as a check on the behavior of both sides.

“Given the parties' behavior to date, there is reason to believe that they will clash on many issues and seek to acquire advantages whenever possible. That was true during the events giving rise to this litigation, it was true during this litigation, and it almost certainly will be true after this litigation,” he said.

“Having overseen this case for two years, addressed a plethora of disputes, presided over the trial, and heard the principals testify firsthand, I am convinced that disputes are likely to arise and to require ongoing judicial involvement during the remedial phase.”

Oxbow is represented by Kenneth J. Nachbar, Thomas W. Briggs Jr. and Richard Li of Morris, Nichols, Arsht & Tunnell and Michael S. Gardener, Breton Leone-Quick and R. Robert Popeo of Mintz, Levin, Cohn, Ferris, Glovsky. Koch is represented by Stephen C. Norman, Jaclyn C. Levy and Daniyal M. Iqbal of Potter Anderson & Corroon and David Hennes and C. Thomas Brown of Ropes & Gray.

Crestview is represented by Kevin G. Abrams, Michael A. Barlow, J. Peter Shindel Jr., Daniel R. Ciarrocki and April M. Ferraro of Abrams & Bayliss; Brock E. Czeschin, Matthew D. Perri and Sarah A. Galetta of Richards, Layton & Finger; and Michael B. Carlinsky, Jennifer J. Barrett, Chad Johnson, Sylvia Simson, Silpa Maruri of Quinn Emanuel.

Load Line is represented by Dale C. Christensen Jr. and Michael B. Weitman of Seward & Kissel and J. Clayton Athey and John G. Day of Prickett, Jones & Elliott.

The case is captioned In re: Oxbow Carbon Unitholder Litigation.