Section 18-111 of the Delaware Limited Liability Act, 6 Del. C. Section 18-111, lists five categories of LLC disputes over which the Delaware Court of Chancery has jurisdiction: the provisions of an LLC agreement; an LLC’s duties and obligations to its members and managers; the duties and obligations between and among the members, managers and the LLC; the rights, powers or restrictions of the LLC or its members or managers; and any provision of the LLC Act or any other instrument, document, agreement or certificate contemplated by any provision of the LLC Act. Until recently, there were no cases definitively addressing the scope of Section 18-111’s fifth jurisdictional category. In Sun Life Assurance Company of Canada—U.S. Operations Holdings v. Group One Thousand One f/k/a Delaware Life Holdings, CA No. N18C-07-173 AML CCLD (Del. Super. Mar. 29, 2019), Judge Abigail LeGrow was called upon to do just that.
The dispute arose out of Group One Thousand One’s (G1001) purchase of several of Sun Life’s subsidiaries. Sun Life brought a breach of contract action in Superior Court against G1001 for failing to pay over a tax refund that Sun Life alleged belonged to it under the stock purchase agreement. G1001 moved to dismiss or transfer the action under the agreement’s forum selection clause, which designated the Court of Chancery as the parties’ first choice of forum for any action arising under the agreement.
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