Ocean, New Jersey –February 10, 2014 - A team of lawyers led by Anthony R. Caruso, Esq. won a major victory in Delaware Chancery Court recently. Vice Chancellor Glasscock ruled in favor of their clients, XXXXXXXXXXX Partners LLC and related individual principals as Plaintiffs, in an action against financial conglomerate XXXXXX Inc.

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Defendants had purchased Plaintiffs’ operations in 2011.  Part of the purchase price was to be paid after the acquisition based on future revenues. The lawsuit stemmed from the absence of post-closing earnings when Plaintiffs expected to accrue more revenue and felt they were precluded by Defendants from doing so. 

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Plaintiffs filed suit in Delaware Chancery Court against Defendant and in New Jersey on a related action against XXXXXX LLC.  Plaintiffs assert several claims including fraud, bad faith and conspiracy against the Defendants.  Defendants immediately filed a motion attempting to dismiss Plaintiffs’ complaint by alleging a failure by Plaintiffs to plead a claim. 

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Defendants were unsuccessful to the extent that the Court agreed with Plaintiffs and allowed two of Plaintiff’s claims to go forward to trial.  The Court held that Plaintiffs have pleaded sufficient facts to support the inference that Defendants breached the implied covenant of good faith and fair dealing by interfering with Plaintiffs’ ability to generate revenue, thereby preventing Plaintiffs from attaining the revenue targets sufficient to trigger payment under the contingent purchase price arrangement.  Additionally, the court sustained Plaintiffs’ breach of contract claim.

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“This is an important victory for our clients, as now they will get the opportunity to prove their case in court,” says lead attorney and partner on the case, Anthony R. Caruso, Esq.  We are confident that our clients will be effective in telling their story as to how they were mistreated by Defendants.  We all look forward to exposing the facts in this case.” 

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Defendants are now required to file a formal answer to the active claims being asserted by Plaintiffs, and then the parties will enter the discovery period.  A decision in the related New Jersey action is expected soon.