Cliff C. Gardner of Skadden, Arps, Slate, Meagher and Flom. Courtesy photo Chancery Orders Unisys to Foot Ex-Exec's Legal Bill, Highlighting Power of Contra Proferentem Doctrine
In Gilbert v. Unisys, the Delaware Court of Chancery ruled that information technology company Unisys Corp. must advance legal fees incurred by two former employees. The underlying lawsuit filed by the company in Pennsylvania federal court alleges trade secret infringement by the former employees.
September 04, 2024 at 09:00 AM
6 minute read
In Gilbert v. Unisys, the Delaware Court of Chancery ruled that information technology company Unisys Corp. must advance legal fees incurred by two former employees. The underlying lawsuit filed by the company in Pennsylvania federal court alleges trade secret infringement by the former employees. After analyzing the advancement provisions in the company's certificate of incorporation, Vice Chancellor Paul A. Fioravanti Jr. sided with the plaintiffs, former vice presidents Leon Gilbert and Michael McGarvey. "When a corporation mandates advancement to the full extent of what is permissible under the statute," the court explained, "it must honor the attendant obligations that flow from that decision." The court applied the doctrine of contra proferentem on whether "vice president" was an officer title for purposes of advancement and indemnification. As drafter of the corporate documents, the court explained, Unisys easily could have clarified what an officer was. But because it did not, the court resolved the ambiguity "against the offeror."
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