Court of Chancery Rule 60(b) allows a party to seek vacatur of a memorandum opinion or an order, under the “interests of justice” when events beyond such party’s control thwarts their ability to appeal such underlying judgment.

In a unique procedural set of events in the case of Shocking Technologies, Inc. v. Michael, C.A. No. 7164-VCN (May 29, 2015), Defendant Simon J. Michael (“Michael”) sought vacatur of a memorandum opinion issued in 2012 finding that he had breached his fiduciary duties owed to Plaintiff Shocking Technologies, Inc. (“Shocking”).  The underlying action was brought under Section 225 of the Delaware General Corporation Law (“DGCL”) to remove Michael as a director of the corporation.

Shortly after the Court’s 2012 opinion was issued, but before a final order was entered adopting the memorandum opinion, Shocking filed for bankruptcy, and has since dissolved.  As a result of the filing of Shocking’s bankruptcy, no order was entered from which Michael could appeal.

In reviewing Michael’s recent motion for vacatur, the Court cited to Stearn v. Koch, 628 A.2d 44, 46 (Del. 1993) and Tyson Foods Inc. v. Aetos Corp., 818 A.2d 145, 148 (Del. 2003), the latter of which stated: “[t]his so-called ‘interests of justice’ standard is no doubt met where the party seeking appellate review is thwarted by some event beyond its control.”

As such, the Court granted Michael’s motion to vacate the 2012 memorandum opinion.

If you would like to speak to a litigator in Fox Rothschild’s Delaware office, please reach out to Sid Liebesman (302) 622-4237 or Seth Niederman (302) 622-4238.