The Court of Chancery’s decision inIn re Mobilactive Media , C.A. No. 5725-VCP (Del. Ch.), provides useful guidance to practitioners asserting or defending against a potential usurpation of corporate opportunity claim. The action arose from a joint venture between plaintiff Terry Bienstock and defendant Silverback Media PLC. Bienstock and Silverback founded Mobilactive Media LLC in 2007 to pursue mobile-marketing opportunities in North America. The Mobilactive limited liability company agreement defined the business of the company as the development and marketing of technology to enable and enhance interactive video programming and advertising content. Pursuant to Section 13.5 of the agreement, the parties agreed that Mobilactive would be the only means by which they or their affiliates would engage in the business. If one of the parties learned of an opportunity in Mobilactive’s line of business, they had to present that opportunity to Mobilactive and could not engage in the business opportunity themselves without the prior written consent, and decision not to pursue the opportunity, by the other members of Mobilactive.
After the parties entered into the agreement, Silverback tried to buy out Bienstock multiple times, according to the opinion. Bienstock declined Silverback’s buyout offers. In June 2007, Silverback entered into a letter of intent to acquire a company engaged in mobile communications and completed the acquisition in September 2007. Silverback continued to acquire companies engaging in various mobile and marketing activities. Silverback never presented these acquisition opportunities to Mobilactive or Bienstock. While Silverback pursued acquisitions, Mobilactive engaged in only two marketing campaigns. Bienstock, however, pursued other opportunities on behalf of Mobilactive.
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