Justia Delaware Supreme Court Opinion Summaries

A group of New York-based third party payor health insurers (“TPPs”) that provided prescription drug benefits to union members appealed a Superior Court judgment dismissing with prejudice their second amended complaint. At issue were claims brought by the TPPs under various state consumer fraud laws against AstraZeneca Pharmaceuticals LP, and Zeneca Inc. (collectively “AstraZeneca”). The TPPs alleged that AstraZeneca falsely advertised its more expensive patented prescription drug "Nexium" as superior to the less expensive generic drug "Prilosec," causing the TPPs to overpay for Nexium when generic Prilosec would have sufficed. After conducting an extensive choice of law analysis, the Superior Court determined that New York law controlled the TPPs’ claims. The court then held that the TPPs failed to state a claim under New York’s consumer fraud statute for failure to allege legally sufficient causation. The TPPs appealed, arguing the Superior Court's choice of law analysis was flawed, and that the Superior Court's causation analysis was equally flawed. After a careful review of the record on appeal, the Delaware Supreme Court affirmed the ultimate judgment of the Superior Court, finding it not necessary to discuss whether the Superior Court correctly analyzed the choice of law issue, because under either state consumer fraud statute the TPPs could not recover damages as a matter of law. View "Teamsters Local 237 Welfare Fund, et al. v. AstraZeneca Pharmaceuticals LP" on Justia Law

In this appeal, Mary DiFebo argued that the Superior Court erred by dismissing her amended petition seeking review of a Board of Adjustment decision that granted a variance application for two land plots located near DiFebo's home to be subdivided into four flag lots. The Superior Court had two related reasons for dismissing the amended petition: (1) that DiFebo had not named the owners of the two properties that were the subject of the Board's proceeding within the thirty-day statute of limitations for commencing a petition challenging a Board decision, and for that reason alone she was foreclosed from proceeding; (2) alternatively, the court found that DiFebo had not met the requirements for relation back under Superior Court Civil Rule 15(c)(3). The Supreme Court concluded that the Superior Court correctly determined that DiFebo did not satisfy all of Rule 15(c)(3)'s requirements to have her amended petition relate back to her initial filing. Accordingly, the Supreme Court affirmed dismissal of DiFebo's amended petition. View "DiFebo v. Board of Adjustment of New Castle County, et al." on Justia Law

Plaintiffs-appellants DeShaun Ketler and Brittany Ketler appealed a Superior Court order granting Defendant-appellee PFPA, LLC’s (“PlanetFitness”) motion for judgment on the pleadings. DeShaun Ketler was injured while using exercise equipment in a Planet Fitness facility. The Ketlers claim that the injuries were caused by negligence on the part of Planet Fitness. The Superior Court found that the Ketlers claim was barred by a signed release of liability. It determined that a release which allowed a party to avoid liability for its own negligence was permissible under Delaware Law if the release is unambiguous, not unconscionable, and not against public policy. It further determined that the release satisfied all three criteria. On appeal, the Ketlers argued the Superior Court erred because the release is ambiguous, unconscionable, and against public policy. Finding no reversible error, the Supreme Court affirmed. View "Ketler v. PFPA, LLC" on Justia Law

"Adam" was born in early 2015 addicted to narcotics. Adam was eventually released to his parents, David Hunt and Carey Land. A few months later, Adam was found unconscious and unresponsive. He was transported to the hospital. The parents offered no explanation as to why Adam had been found unresponsive or unconscious. Though they were home when emergency personnel arrived, neither parent accompanied the child to the hospital. Due to the seriousness of the child's condition, he was transported to a trauma center. Medical personnel determined the child had sustained multiple trauma caused by "unexplained abusive trauma." In addition to multiple fractures, Adam's other diagnoses included chronic bilateral subdural hematomas, destruction of brain tissue, seizures, respiratory failure, malnourishment and splitting of the layers of the retina in his left eye. Emergency custody would ultimately be awarded to the Department of Family Services. This expedited proceeding was the parents' appeal of a Family Court decision granting the attorney guardian ad litem's motion to instruct Adam's medical providers to de-escalate intervention and place a do-not re-intubate order and a do-not-resuscitate order and a "comfort measures" order on Adam's medical chart. The appeal presented four issues for the Delaware Supreme Court's review: (1) whether the Family Court had jurisdiction to de-escalate medical care, a no re-intubate order and do not resuscitate order on the minor's chart; (2) whether the Family Court had authority to allow such orders when the parental rights have not been terminated; (3) whether the Family Court violated the parents' procedural due process rights by not providing the parents adequate notice and process prior to issuing the orders; and (4) were the parents' due process rights violated without receiving evidence from an independent medical expert. The Supreme Court found no reversible error in the Family Court's decision, and affirmed. View "Hunt v. DFS & Office of the Child Advocate" on Justia Law

In the name of controlling litigation costs, a heating and air conditioning contractor, Blue Hen Mechanical, Inc. sued Christian Brothers Risk Pooling Trust as subrogee for the Little Sisters of the Poor for malicious prosecution. In January 2008, the Little Sisters of the Poor contracted with Blue Hen to maintain the heating, ventilation, and air conditioning equipment at its nonprofit residential nursing home facility. Two months later, the nursing home's air conditioner broke, requiring the unit to be replaced at a cost of $168,740. The Little Sisters of the Poor filed suit against Blue Hen, alleging that the unit's failure was due to Blue Hen's negligence in inspecting and maintaining the equipment. After briefing and oral argument, the Superior Court determined that the Little Sisters of the Poor had not produced sufficient evidence of Blue Hen's negligence, and granted Blue Hen's motion for summary judgment. Rather than seek costs in that lawsuit, Blue Hen initiated another suit against the Little Sisters of the Poor, alleging malicious prosecution and abuse of process. Blue Hen conceded that the Little Sisters of the Poor initially had good cause to sue. But it contended that during the course of that litigation, the Little Sisters of the Poor should have realized that its suit lacked probable cause, and should have dismissed its claims against Blue Hen. The Superior Court refused to enlarge the tort of malicious prosecution, which has historically been disfavored by Delaware courts, and determined that under the tort (as Delaware court have defined it), Blue Hen failed to demonstrate that the Little Sisters of the Poor acted maliciously in bringing its action and granted summary judgment to the Little Sisters of the Poor. Blue Hen appealed, and the Supreme Court affirmed: "[w]hatever the original wisdom for sanctioning the tort of malicious prosecution, we refuse to extend it to encompass claims properly brought before the court in the first instance. As important, there is no basis in the summary judgment record to support a rational jury finding that the Little Sisters of the Poor acted maliciously in the original suit, rather than in a good faith belief that Blue Hen was responsible for the serious losses that the Little Sisters of the Poor had suffered." View "Blue Hen Mechanical, Inc. v. Christian Brothers Risk Pooling Trust" on Justia Law

The Delaware Alcoholic Beverage Control (ABC) Commissioner appealed a superior court judgment dismissing his claim against the Delaware Alcoholic Beverage Control Appeals Commission for lack of standing. The Appeals Commission overturned the ABC Commissioner's decision to deny an application for a change of license classification by Lex-Pak, Inc., d/a/b Hak's Sports Bar & Restaurant. Hak's filed a motion to dismiss on grounds that the ABC Commissioner lacked standing. The superior court agreed and dismissed the case. After its review, the Supreme Court concluded that the Delaware Code did not vest the ABC Commissioner with standing to pursue an appeal of decisions by the Appeals Commission. Accordingly, the Court affirmed the superior court's judgment. View "Office of the Commissioner Delaware Alcoholic Beverage Control v. Appeals Commission Delaware Alcoholic Beverage Control" on Justia Law

At issue before the Supreme Court in this case was a Superior Court's grant of summary judgment to defendants, Fairwinds Church and Fairwinds Christian School (collectively, “Fairwinds”), in an action brought by former student Kimberly Hecksher under the Child Victim‟s Act. Hecksher sued Fairwinds under the Act, arguing that Fairwinds, a small, religious school, was grossly negligent for failing to prevent sexual abuse by Ed Sterling (her foster father and her teacher at Fairwinds), that occurred while she was a student. Hecksher alleged that Sterling's wife and fellow-Fairwinds employee, Sandy Sterling, observed Sterling abusing Hecksher on school property, and that Sandy's knowledge of and tortious failure to report the abuse should have been imputed to Fairwinds. Hecksher also argued that Fairwinds was grossly negligent for failing to have a sexual abuse prevention policy in place and for not responding to red flags that Sterling posed a serious risk to Fairwinds students. The Supreme Court disagreed with the Superior Court's grant of summary judgment, finding several instances where reasonable jurors could have found differently than did the Superior Court. The Supreme Court therefore concluded material issues of fact remained, specifically as to whether Sandy's knowledge and conduct could be imputed to Fairwinds, and whether Fairwinds was grossly negligent for failing to have any sexual abuse prevention and detection policies in place and for failing to act on red flags that Sterling posed a serious risk to female students. Accordingly, the grant of summary judgment was reversed and the case remanded for trial. View "Hecksher v. Fairwinds Baptist Church, Inc., et al." on Justia Law

These appeals both involved damages actions by stockholder plaintiffs arising out of mergers in which the controlling stockholder, who had representatives on the board of directors, acquired the remainder of the shares that it did not own in a Delaware public corporation. Both mergers were negotiated by special committees of independent directors, were ultimately approved by a majority of the minority stockholders, and were at substantial premiums to the pre-announcement market price. Nonetheless, the plaintiffs filed suit in the Court of Chancery in each case, contending that the directors had breached their fiduciary duty by approving transactions that were unfair to the minority stockholders. In both appeals, it was undisputed that the companies did not follow the process established in "Kahn v. M&F Worldwide Corporation" as a safe harbor to invoke the business judgment rule in the context of a self-interested transaction. In both cases, the defendant directors were insulated from liability for monetary damages for breaches of the fiduciary duty of care by an exculpatory charter provision adopted in accordance with 8 Del. C. 102(b)(7). Despite that provision, the plaintiffs in each case sued the controlling stockholders and their affiliated directors, and also sued the independent directors who had negotiated and approved the mergers. The issue central to both, presented for the Supreme Court's review was whether, where the plaintiff challenges an interested transaction that is presumptively subject to entire fairness review, must plead a non-exculpated claim against the disinterested, independent directors to survive a motion to dismiss by those directors. The Court answered that question in the affirmative: a plaintiff seeking only monetary damages must plead non-exculpated claims against a director who is protected by an exculpatory charter provision to survive a motion to dismiss, regardless of the underlying standard of review for the board's conduct. The Court of Chancery in both of these cases denied the defendants' motions to dismiss because it read the Supreme Court's precedent to require doing so, regardless of the exculpatory provision in each company's certificate of incorporation. When the independent directors are protected by an exculpatory charter provision and the plaintiffs are unable to plead a non-exculpated claim against them, those directors are entitled to have the claims against them dismissed, in keeping with the Court's opinion in "Malpiede v. Townson" (and cases following that decision). Accordingly, the Court remanded both of these cases to allow the Court of Chancery to determine if the plaintiffs sufficiently pled non-exculpated claims against the independent directors. View "In Re Cornerstone Theraputics, Inc. Leal, et al. v. Meeks, et al." on Justia Law

Petitioner-appellant La Mar Gunn appealed a superior court judgment declaring a tie in the November 4, 2014 general election for the Office of the Recorder of Deed for Kent County. Defendant-appellee Betty Lou McKenna moved to dismiss Gunn's election contest, arguing that Gunn failed to state a claim upon which relief could be granted. In response to McKenna's motion, Gunn argued that the petition stated a claim, and pointed to the election recount conducted by two superior court judges, "evidenced 'malconduct on the part of election officers or clerks holding the election,'" because three different county conducted by the superior court (sitting as the Board of Canvass) resulted in three different outcomes. McKenna countered that the judges sitting as the Board of Canvass were not "election officers or clerks holding the election." The superior court denied McKenna's motion to dismiss. On appeal, McKenna argued that the superior court "missed the key point" in her motion, and that the claims asserted in Gunn's petition did not fit within the jurisdictional requirements of 15 Del. C. 5941. After review, the Supreme Court concluded that Gunn's petition failed to allege any "malconduct on the part of election officers or clerks holding the election." Therefore, McKenna's motion should have been granted. This case was remanded to the superior court with directions that the judgment be vacated. View "Gunn v. McKenna" on Justia Law

In 2013, the Superior Court granted Branch Banking and Trust Company's ("BB&T") motion for summary judgment on its foreclosure and breach of contract claims. In 2014, the Superior Court entered a final judgment order awarding damages to BB&T. The Eids failed to file a timely notice of appeal of thatorder. Instead, a little over two months after the entry of the final judgment order, the Eids filed a motion with the Superior Court under Rule 60(b) seeking vacatur of the final judgment order, contending that their counsel never received actual notice of the final judgment order. The Superior Court granted the Eids' motion to vacate. Then trial court entered a new final judgment order from which the Eids could file a timely notice of appeal. BB&T filed an appeal from the Superior Court's grant of the Rule 60(b) motion to vacate, and the Eids filed a cross-appeal of the Superior Court's grant of summary judgment in favor of BB&T. BB&T raises three issues on appeal: (1) that pursuant to Rule 77(d), the trial court lacked authority to grant the motion to vacate the final judgment order; (2) that the trial court erred as a matter of law when it applied a vague and undefined "interest of justice" standard to the motion to vacate; and (3) that the trial court abused its discretion in granting the motion to vacate because the Eids failed to establish that they were entitled to relief under Rule 60(b)(1) or (b)(6). On cross-appeal, the Eids also raised three issues: (1) that BB&T lacked standing to institute a foreclosure; (2) that the affidavit supporting the motion for summary judgment was defective; and (3) that BB&T failed to demonstrate that there were no genuine issues of material fact. After review, the Supreme Court agreed with BB&T that the trial court improperly granted the motion to vacate the final judgment, and reversed that decision. View "Branch Banking & Trust Co. v. Eid" on Justia Law