COURT OF CHANCERY OF THE STATE OF DELAWARE

M ORGAN T

. Z URN V ICE C HANCELLOR L EONARD L. W ILLIAMS J USTICE C ENTER 500 N. K ING S TREET , S UITE 11400 W ILMINGTON , D ELAWARE 19801

- 3734 August 2 5 , 2023 Julian Karpoff 33026 W. Falling Creek Street Lewes, Delaware 19958 captainkarpoff@outlook.com D a vid C. Hutt, Esquire M o rris James, LLP 1 07 W. Market Street Georgetown, Delaw are 19947 Vincent G. Robertson, Esquire Parkowski, Guerke & S wayze, P.A. 19354C Miller Road Rehoboth Beach, Delaware 19971
RE : Julia n Karpof

f v. Atlantic Concrete Co., Inc. and Sussex County , Civil Action No. 2022

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- SEM Dear counsel and Mr. Karpoff,
I write to address plaintiff Julian Karpoff (“Plaintiff”) ’s exceptions to Magistrate Molina’s February 28, 2023 Final Report. 1 The Final R eport dismissed
Plaintiff’s claims in favor of a first

- filed Sussex County Board of Adjustment proceeding. Plaintiff’s exceptions are limited to the d ecision to issu e that report notwithstanding Plai ntiff ’ s pending motion for leave to file an amended comp lai nt , which he filed after the motion to dismiss was taken under advisement

. 2 Plaintiff

1 Karpoff v. Atlantic Concrete Co., Inc. , 2023 WL 2260588 (Del. Ch. Feb. 28, 2023) [hereinafter “Final Report”]. The Final Report is also available at Docket Item (“D.I.”) 63.
2 Final Re port at *1 n.1.Karpoff v. A t lantic Concrete Co., Inc

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- SEM August 28, 2023 Page 2 of 7
then filed a second motion to amend. For the reasons that follow, I remand consideration of Plaintiff’s motions to amend to the Magistrate for her
consideration. On this procedural matter, I rely on the parties ’ familiarity with the underlying dispute

. I. Background
On November 7 , 2022, the Magistrate heard oral argument on defendant Atlantic Concrete Co., Inc.’s motion to dismiss, as well as a motion by defendant
Suss ex County to compel election of a single forum, and took the motions under
advisement. 3 After those motions were fully briefed , argued, and taken under advisement, Plaintiff filed a motion for leave to amend (the “First Motion”) that
was docketed on Febru ary 6, 2023. 4 The First Motion seeks leave to add a new defendant, the Department of Natural Resources and Environmental Control (“DNREC”), and two new counts pled against DNREC and Atlantic Concrete for abatement and for a declaratory judgment bas ed on v iolations of the Coastal Zone
Act and lack of proper permits

. 5 On February 28, t he Magistrate issued her Final Report with the following footnoted language :

3 D.I. 58, D.I. 56, D.I. 57.
4 D.I. 59, D.I. 62.
5 D.I. 62.Karpoff v. A t lantic Concrete Co., Inc

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- SEM August 28, 2023 Page 3 of 7 On February 6, 2023, the Plaintiff moved for leave to file an amended complaint to add (1) the D epartment of Natural Resources and Environmental Control as a defendant and (2) two additional counts. D.I. 59

- 62. The motion is not fully briefed but I decline to delay issuing this report under the rationale of Hillblom v. Wilmington Tr. Co ., 2022 WL 17 428978, at *1 (Del. Ch. Dec. 6, 2022) (denying a motion to amend without prejudice because “Court of Chancery Rule 15 does not permit a plaintiff to amend his co mplaint after he filed his answering brief but before the motion to dismiss is decided”). 6
T he next day, March 1, Plaintiff ’ s motion to fix a briefing schedule on the First
Motion was docketed

. 7 As Atlantic Concrete noted in opposition, “Based up on the timestamp, it appears that Mr. Karpoff filed his request before learning that the
Court had issu ed its February 28, 2023 Final Report.” 8 Plaintiff’s notice of exceptions was filed on March 7, and the matter was reassigned to me “for the limited pu rpose of resolving Plaintiff’s exceptions to the Master’s Final Report.” 9 On March 16, Plaintiff renew ed his request to establish a briefing schedule and filed another motion for leave to file an amended complaint (the “Second Motion”) , which he stated w as “without prejudice” to the First
Motion

. 10 From there, the parties briefed Plaintiff’s exceptions ; th ey also briefed

6 Final Report at *1 n.1.
7 D.I. 64.
8 D.I. 65 at 1

. 9 D.I. 67, D.I. 68.
10 D.I. 71 ¶ 1

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- SEM August 28, 2023 Page 4 of 7 the propriety of the Second Motion. 11 Plaintiff has requested oral argument, but I do not find it necessary.
II. Analysis I consider the issues presented by Plaintiff’s exceptions de novo. 12 Court of Chancery Rule 15 governs amendments to ple adings. Rule 15(a) states : A party may amend the party ’ s pleading once as a matter of course at any time before a responsive pleading is served or, if the pleading is one to which no responsive pleading is permitted and the action has not been set for tr ial, the party may so amend it any time within 20 days af ter it is served. Otherwise a party may amend the party ’ s pleading only by leave of Court or by written consent of the adverse party; and leave shall be freely given when justice so requires. 13
Ru le 15(aaa) governs “[w]hen a party seeks to amend its ple ading in response to a
motion to dismiss.” 14 It states : “Notwithstanding subsection (a) of this Rule, a party that wishes to respond to a motion to dismiss under Rules 12(b)(6) or 23.1 by amending i ts pleading must file an amended complaint, or a motion to amend in conformity with this Rule, no later than the time such party ’ s answering brief in response to either of the foregoing motions is due to be filed.” 15 “Rule 15(aaa) is not applicable to an a mendment that states a new claim not addressed in a mot ion

11 D.I. 75, D.I. 76, D.I. 80.
12 DiGiacobbe v. Sestak , 743 A.2d 180, 184 (Del. 1999).
13 Ct. Ch . R. 15(a).
14 TVI Corp. v. Gallagher , 2013 WL 5809271, at *20 (Del. Ch. Oct. 28, 2013).
15 Ct. Ch. R. 15(aaa).Karpoff v. A t lantic Concrete Co., Inc

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- SEM August 28, 2023 Page 5 of 7 to dismiss.” 16 That is so even where such an amendment was sought while the motion to dismiss was pending. 17 The addition of n ew claims that would not have informed the Court’s decision on a pendin g motion to dismiss is assessed under Rule 15(a). 18
If Plaintiff’s First Motion had proposed amendments to his allegations and pending claims subject to the motion to dismiss he had already opposed , Rule 15(aaa) would have governe d , and it would have been a ppropriate to stay
consideration of the First Motion

. 19 But the First Motion seeks to add DNREC as a party and to plead additional claims against DNREC , toge ther with Atlantic Concrete, based on violations of the Coastal Zone Act

— claims that were not
withi n the purview of the motion to dismiss

. 20 Based on my review of the docket, I
do not believe Plaintiff “wish[ ed ] to respond to a motion to dismiss . . . by amending [his] pleading”

— he wished to add a party and a new legal theory

16 In re USG Corp. S’holder Litig. , 2021 WL 930620, at *2 (Del. Ch. Mar. 11, 2021).
17 TVI Corp. , 2013 WL 5809271, at *21

. 18 Id

. 19 See Hillblom v. W

ilmington Tr. Co ., 2022 WL 17428978, at *4

– 6 (Del. Ch. Dec. 6, 2022) ; Kablaoui v. Gerar Place Condo

. Ass ’ n , 2022 WL 17827089, at *1 , *4 (Del. Ch. Dec. 21, 2022) ( where plaintiff sought “ to supplement an insufficient complaint after answering a motion to di smiss, attempting thereby to include facts and allegations known to that plaintiff before he filed the answer to the motion, and tailored to defeat the motion , ” that motion was clearly “ responsive to the pending mot ion to dismiss, ” and Rule 15(aaa) was ins tructive).
20 D.I. 62.Karpoff v. A t lantic Concrete Co., Inc

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- SEM August 28, 2023 Page 6 of 7 independent fro m the motion to dismiss other claims against existing parties

. 21 Plaintiff has indicated that the timing of the First Motion is based on the timing of
his factual investigation , not the timing of the motion to dismiss. 22 Plaintiff stood on his complaint against the mo ving defendants and opposed their motion to dismiss, as Rule 15(aaa) intends , and he has not taken ex ception to the Final Report granting that motion

. 23 The First Motion does not squarely fall within Rule 15(aaa). I conclude the First Motion is generally governed by Rule 15(a) ’s liberal standard, not Rule 15(aaa) ’s good cause standard

. Any additional allegations regarding the claims subject to dismissal are subject to Rule 15(aaa). 24 That conclusion begs the question of what to do next. Plaintiff has n ot taken exception to the Magistrate’s conclusion that his original claims, against Atl antic Concrete Company and Sussex County, should be dismissed in favor of the first

filed Board of Adjustment proceeding. For what it is worth, I believe the Magistrate ’s reasoning and conclusion on that point are sound , and that the Final

21 See Ct. Ch. R. 15(aaa) ; TVI Corp. , 2013 WL 5809271, at *21

. 22 D.I. 59 ¶ 4 ; D.I. 80 at 5 ( “[T]he motions to amend do not ask that the Master revisit the deferral of the zoning claims to the BOA, but only to amend the complai nt. ”)

. 23 D.I. 75, D.I. 80 ; s ee Lillis v. AT&T Corp. , 896 A.2d 871, 878 (Del. Ch. 2005)

. 24 TVI Corp. , 2013 WL 5809271, at *21

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- SEM August 28, 2023 Page 7 of 7 Report should be adopted

. 25 With Counts I and II against Atlantic Concrete Company and Sussex County dismissed, t he question remains whether the First
Motion to plead the new counts ag ainst DNREC and Atlantic Concrete under the
Coastal Zone Act should be granted under Rule 15(a). I remand this question for
the Magistrate’s review. Briefing on Plaintiff’s exceptions also addressed the Second Motion. I do not have authority to decide the Second Motion: that should be heard by the Magistrate in the first instance. I leave it to the Magistrate to decide if the parties’ briefing submitted on exception adequately addresses the Second Motion, and leave this matter to her capable jurisdict ion.
III. Conclusion
This matter is remanded to the Magistrate for consideration of the First
Motion under Rule s 15(a) and 15(aaa) as set forth above, and for consideration of
the Second Motion in the first instance. Sincerely,
/s / Morgan T. Zurn Vice Chancellor cc: All Counsel of Record, v ia File & ServeXpress

25 Because I have been assigned this matter only to consider Plaintiff’s exceptions, and he did not take exception to that reasoning or c onclusi on , my belief may be worth nothing; adopting the Final Report may still be a task for the Chancellor, as it is in cases in which no exceptions were taken.