IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE

JOSEPH GOLDEN,

Plaintiff,

v.

SHOOTPROOF HOLDINGS, LP, 

SHOOTPROOF HOLDINGS GP, LLC, 

SHOOTPROOF, LLC, PSG EQUITY L.L.C., 

PROVIDENCE STRATEGIC GROWTH III 

L.P., PROVIDENCE STRATEGIC GROWTH 

III-A L.P., STEPHEN MARSHALL, and 

THOMAS MCDERMOTT,

Defendants.

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 C.A. No. 2022-0434-MTZ

MEMORANDUM OPINION

Date Submitted: November 9, 2022

Date Decided: February 28, 2023

Michael A. Barlow, ABRAMS & BAYLISS LLP, Wilmington, Delaware; Rollo 

C. Baker, IV, Margaret Schmidt, QUINN EMANUEL URQUHART & 

SULLIVAN, New York, New York, Attorneys for Plaintiff.

Bradley R. Aronstam, S. Reiko Rogozen, Holly E. Newell, ROSS ARONSTAM & 

MORITZ LLP, Wilmington, Delaware; Yehudah L. Buchweitz, Joshua S. Amsel, 

Andrew Cauchi, WEIL, GOTSHAL & MANGES LLP, New York, New York,

Attorneys for Defendants.

ZURN, Vice Chancellor.
1

This case presents a familiar story. Two co-founders started a business that 

succeeded and grew into a target for an acquisition. When the company entered 

negotiations with a purchaser, the plaintiff co-founder emphasized the importance 

of the management team and employees, including the plaintiff’s spouse, staying on 

with the new post-transaction company. According to the plaintiff, the purchaser 

and its affiliates and agents assured him that he and his management team would 

have prominent roles in the new company, and that together they would incentivize 

employee retention. The agreements documenting the merger did not make any such 

assurances; they also contained integration and antireliance language. After the 

transaction closed, the new company fired the plaintiff and his spouse.

The plaintiff, a Washington state resident, filed an action in this Court against 

the purchaser and its affiliates and agents alleging the defendants violated 

Washington securities law. Count I alleges the defendants made misleading 

statements in connection with a sale of securities. Count II alleges certain of the 

defendants are jointly and severally liable for those misleading statements.

The two individual defendants, who are not Delaware residents, sought

dismissal for lack of personal jurisdiction. The plaintiff argues this Court can 

exercise personal jurisdiction over the individual defendants via the merger 

agreement’s forum selection clause because they were third-party beneficiaries or 

closely related to the agreement. The plaintiff also argues the individual defendants 
2

engaged in substantial acts in Delaware in connection with the merger that subject 

them to personal jurisdiction under Delaware’s long arm statute. This opinion 

concludes neither route secures personal jurisdiction over the individual defendants.

All the defendants moved to dismiss the complaint for failure to state a claim

due to the plaintiff’s contractual inability to rely on extracontractual statements. The 

plaintiff argues the antireliance and integration provisions are void because they 

impermissibly waive claims under Washington securities law. The defendants argue 

the provisions do not act as a waiver and are not void, but rather narrow the universe 

of possible statements the plaintiff can contest as misleading. Washington law 

supports the defendants’ argument. Accordingly, I grant the defendants’ motion and 

the complaint is dismissed.
3

I. BACKGROUND1

Plaintiff Joseph Golden (“Plaintiff”

2

), a Washington resident, is the former 

co-founder and co-CEO of Collage.com, Inc. (“Collage”). Nonparty Kevin Borders 

was Collage’s other co-founder and co-CEO. Founded in 2007, Collage was an ecommerce business offering a variety of customizable photo and home products.

In late 2020, Collage met with defendant ShootProof, LLC (“ShootProof”), a 

Georgia limited liability company headquartered in Georgia that provided amateur 

and professional photographers with tools to market and sell their photographs 

online. Defendant Stephen Marshall, a Georgia resident, was ShootProof’s CEO, 

and Defendant Thomas McDermott, a Georgia resident, was its CFO (together with 

Marshall, the “Individual Defendants”). ShootProof’s private equity sponsor was 

Defendant PSG Equity L.L.C. (“PSG”), a Delaware limited liability company, which

1

I draw the following facts from the Verified Complaint, the documents attached and 

integral to it, affidavits, and any discovery of record. Docket Item (“D.I.”) 1 [hereinafter 

“Compl.”]. See, e.g., Himawan v. Cephalon, Inc., 2018 WL 6822708, at *2 (Del. Ch. 

Dec. 28, 2018); In re Gardner Denver, Inc. S’holders Litig., 2014 WL 715705, at *2 (Del. 

Ch. Feb. 21, 2014); Sprint Nextel Corp. v. iPCS, Inc., 2008 WL 2737409, at *5 (Del. Ch. 

July 14, 2008) (citing Ryan v. Gifford, 935 A.2d 258, 265 (Del. Ch. 2007)). Citations in 

the form of “OB —” refer to the Opening Brief in Support of Defendants’ Motion to

Dismiss Plaintiff’s Verified Complaint, available at D.I. 14. Citations in the form of 

“AB —” refer to Plaintiff’s Answering Brief in Opposition to Defendants’ Motion to 

Dismiss, available at D.I. 16. Citations in the form of “RB —” refer to the Reply Brief in 

Further Support of Defendants’ Motion to Dismiss Plaintiff’s Verified Complaint, 

available at D.I. 19.

2 Plaintiff is married to nonparty Lindsey Golden. Compl. ¶ 3. To the extent this opinion

refers to Joseph Golden and Lindsey Golden by their first names, it is in pursuit of clarity 

and without intending any disrespect or familiarity.
4

“invests in growth-stage software businesses and the founders and management 

teams that drive them.”3 PSG invested in ShootProof through ShootProof’s majority 

owner, Defendant ShootProof Holdings, LP (“Holdings”), a Delaware limited 

partnership.

4

 ShootProof Holdings GP, LLC (“Holdings GP”) is Holdings’s general 

partner, and Defendants Providence Strategic Growth III L.P. and Providence 

Strategic Growth III-A L.P. are Delaware limited partnerships and Class A Preferred 

Limited Partners in Holdings (together with PSG, ShootProof, Holdings, Holdings 

GP, and the Individual Defendants, “Defendants”).

On December 2, 2020, Collage and ShootProof executed a letter of intent that 

outlined the basic terms of an acquisition. ShootProof proposed acquiring Collage 

for $82.5 million, to be adjusted upward or downward based on formal valuation and 

diligence, but “no less than” $26.5 million of that consideration would be in the form 

of “rollover equity by key Collage managers into ShootProof equity interests.”5 The 

letter of intent reflected Defendants’ belief that “Collage represent[ed] an 

opportunity to invest behind,” and partner with, “a strong team.”6 Defendants also 

emphasized that “PSG has a strong track record of partnering with founders and 

3 PSG’s principal place of business is in Boston, Massachusetts. Id. ¶ 13.

4 Holdings’s principal place of business is in Georgia. Id. ¶ 10.

5

Id. ¶ 40.

6

Id. ¶ 41 (emphasis omitted).
5

management teams to scale software companies.”7 Collage viewed ShootProof as 

“a strong strategic partner” to help it grow and succeed.

8

Between December 2020 and March 2021, ShootProof, PSG, and Collage 

negotiated ShootProof’s acquisition of Collage by combining Collage and a merger 

subsidiary into a single surviving ShootProof subsidiary, called Foreground. 

Plaintiff and Borders negotiated on behalf of Collage. While the Individual 

Defendants negotiated on behalf of ShootProof, their “strategic decisions and 

substantive positions” aligned with PSG.9

Plaintiff and Borders made clear to Defendants that they would not proceed 

with the transaction absent representations and assurances that they would have 

active and substantial roles in the surviving entity, and that Collage employees 

would keep their positions. Plaintiff negotiated for the payment of retention bonuses 

to Collage employees. In January 2021, Plaintiff spoke with Marshall about 

developing a post-closing retention plan for Collage employees because he believed 

Collage’s employees were key to the company’s future success. Marshall agreed 

retention was important and suggested Plaintiff work with PSG to develop a plan. 

In February 2021, Plaintiff discussed with Defendants, including PSG, the 

7

Id.

8

Id. ¶ 43; see id. ¶¶ 42–45.

9

Id. ¶¶ 46–47.
6

mechanics of the retention bonuses. Marshall stated that his “number one concern” 

was to make sure “no one goes anywhere.”10 Later that month, Marshall circulated 

a draft slide deck directed toward Collage employees announcing, “We’re growing; 

no roles are being eliminated.”11

In late February 2021, Lindsey Golden, Collage’s general counsel and 

Plaintiff’s spouse, emailed the Individual Defendants to seek clarity about her role 

as general counsel in the surviving entity since ShootProof did not have in-house 

counsel. On March 2, McDermott affirmed that Lindsey would have a role as 

counsel in the surviving entity and provided her with a list of “short term needs.”12 

The Individual Defendants confirmed Lindsey’s role in a phone call with her the 

next day.13 Also on March 2, Marshall emailed Plaintiff about compensation and 

titles in the surviving entity. Marshall indicated he was “concerned about using the 

‘President’ title” for Plaintiff, and instead proposed exploring “Chief Economist” or 

“other CxO titles.”14 Marshall stated Borders would “tak[e] on the CTO title and 

role.”15

10 Id. ¶ 53 (emphasis omitted).

11 Id. ¶ 54 (emphasis omitted).

12 Id. ¶ 56.

13 Id.

14 Id. ¶ 58.

15 Id.
7

On March 5, Collage’s lead banker asked PSG to confirm it did not have “an 

intent to reduce compensation amongst the go forward employees.”16 PSG 

responded, “Of course not. We’ve got no intention of modifying comp or cutting 

headcount. We simply feel that if we’re buying 100% of a business, we should not 

be restricted from operating it as we see fit (which of course includes board and 

management discussions, of which Joe and Kevin would be a part).”17

On March 10, the transaction closed. The transaction parties consummated 

the merger pursuant to the Agreement and Plan of Merger by and among ShootProof, 

LLC, Collage Merger Sub Inc., Lindsey Golden as Stockholder Representative, and 

Collage.com, Inc., dated March 10, 2021 (the “Merger Agreement”).

18 ShootProof 

paid approximately two-thirds of the $91.4 million purchase price in cash and the 

remaining one-third in shares of common stock of ShootProof Parent Corp.19 The 

Merger Agreement provides that Collage Class A common stock would be converted 

into the right to receive both cash and shares in ShootProof Parent Corp.20 It also 

16 Id. ¶ 60.

17 Id.

18 Compl. Ex. A.

19 Compl. ¶ 48; Compl. Ex. B at Recitals. ShootProof Parent Corp., a Delaware 

corporation, “is the owner of all the equity interests of ShootProof Senior LLC, a Delaware 

limited liability company . . . . ShootProof Senior LLC is the owner of all of the interests 

in ShootProof Intermediate, LLC, a Delaware limited liability company, which in turn is 

the owner of all of the equity interests of [ShootProof].” Compl. Ex. A §§ 1.1, 6.1; id. at 

Preamble.

20 Compl. Ex. A § 3.1(c).
8

provides as a condition of closing that holders of Class A common stock would 

execute a Contribution and Exchange Agreement (the “Contribution and Exchange 

Agreement”) by which the shares in ShootProof Parent Corp. would be converted 

into newly issued common limited partnership units in Holdings.21 The Complaint 

defines “Rollover Shares” as the Holdings units that Plaintiff ultimately received.22

Plaintiff ultimately received $12,901,316 of the purchase price in Rollover 

Shares, and a seat on Holdings GP’s board. Plaintiff viewed the Rollover Shares as 

an opportunity to share in the benefits of the transaction and the new entity’s 

anticipated growth. As foretold in the Merger Agreement, he exchanged Shootproof 

Parent Corp. shares for partnership units in Holdings pursuant to the Contribution 

and Exchange Agreement dated March 10.

23 The Merger Agreement and the 

Contribution and Exchange Agreement are governed by Delaware law, and include 

integration and antireliance provisions.24

21 Compl. Ex. A § 4.1(d)(vii); id. at Recitals; Compl. Ex. B.

22 Compl. ¶ 48(d); see also id. at 6 n.2; id. ¶ 107. For its part, the Contribution and 

Exchange Agreement defines “Rollover Shares” as shares of ShootProof Parent Corp. that 

Collage’s “Class A Stockholders” received pursuant to the Merger Agreement. Compl. 

Ex. B at Recitals; see also Compl. Ex. A at Recitals (explaining Class A Stockholders 

would receive “shares of Parent Corp Stock” pursuant to the Merger Agreement); id. § 1.1 

(defining “Parent Corp Stock” as common stock in ShootProof Parent Corp.); see also AB 

at 13 (“Defendants cannot challenge the second element of [Plaintiff’s RCW 21.20.010] 

claim because the Merger was clearly the sale of a security.”). This opinion adopts 

Plaintiff’s definition in considering his theory.

23 Compl. Ex. B § 1.1.

24 Compl. Ex. A §§ 8.10, 9.2, 9.8(a); Compl. Ex. B §§ 2.2(n), 4.7, 4.8(a).
9

Marshall stayed on as Foreground’s CEO, and McDermott remained as CFO. 

But Collage’s management team’s role in Foreground was uncertain. On March 11, 

Plaintiff sent the legacy Collage employees an email that had been circulated to and 

approved by Defendants’ representatives, including the Individual Defendants. The 

email stated “[n]o one is losing their jobs as a result of the merger” and “[e]veryone 

on our team is staying.”25 It also identified Plaintiff as “Chief ??? Officer” and 

indicated “Joe will manage an expanded research and analysis department, and pick 

up TBD leadership responsibilities once we better understand the needs to the 

combined organization.”26 Beginning on March 17, Plaintiff corresponded with 

Marshall about serving on Foreground’s compensation committee.

On March 18, McDermott told Lindsey that she would be fired as general 

counsel based on PSG’s discomfort with conflicts stemming from her marriage to 

Plaintiff. On March 21, Marshall withdrew his offer to Plaintiff to sit on 

Foreground’s compensation committee. Around this time, Borders resigned from 

his position as Foreground CTO and was never replaced.

On April 13, Plaintiff asked Defendants to buy back his Rollover Shares. 

They refused. On April 21, Plaintiff met with Marshall to negotiate a potential 

separation agreement. Marshall’s conditions included Plaintiff relinquishing his seat 

25 Compl. ¶ 66.

26 Id.
10

on the Holdings GP board. Plaintiff refused unless Defendants bought out his 

Rollover Shares. Plaintiff declined to accept the terms of the separation agreement,

and his employment at Foreground was terminated.

Plaintiff turned to this Court. On May 18, 2022, he filed a verified complaint 

(the “Complaint”) seeking over $12 million in rescissory damages.27 Count I alleges 

“Defendants made untrue statements of material fact” to Plaintiff “regarding the 

retention and involvement of Collage management and employees, in violation of 

the Revised Code of Washington, Title 21, Chapter 21.20, Section 21.20.010 (‘RCW 

21.20.010’)” in connection with the sale of the Rollover Shares in Holdings while 

he was in Washington.

28

 Count II alleges PSG, Holdings GP, and the Individual 

Defendants are “controlling persons of ShootProof within the meaning of” the 

Revised Code of Washington, Title 21, Chapter 21.20, Section 21.20.430 (“RCW 

21.20.430”), and so are liable for PSG and ShootProof’s violations of RCW 

21.20.010.29

27 Compl.

28 Id. ¶¶ 106–113.

29 Id. ¶¶ 114–121.
11

On June 13, Defendants moved to dismiss the Complaint (the “Motion”) 

under Court of Chancery Rules 12(b)(2) and 12(b)(6).

30 The parties briefed the 

Motion, and I heard argument on November 9.31

II. ANALYSIS 

The Individual Defendants seek dismissal of the claims against them under 

Court of Chancery Rule 12(b)(2) for lack of personal jurisdiction. All Defendants 

have moved this Court to dismiss the action under Rule 12(b)(6) for failure to state 

a claim. For the reasons that follow, I conclude this Court lacks personal jurisdiction 

over the Individual Defendants, and the Complaint fails to state a claim upon which 

relief may be granted.

A. This Court Lacks Personal Jurisdiction Over The Individual 

Defendants.

Courts can only adjudicate cases in which they have personal jurisdiction over 

the parties.32 “Because a motion under Rule 12(b)(2) presents factual and legal 

questions, a court cannot grant it ‘simply by accepting the well pleaded allegations 

of the complaint as true, because the pleader has no obligation to plead facts that 

30 D.I. 9.

31 OB; AB; RB; D.I. 29; D.I. 30 [hereinafter “Hr’g Tr.”].

32 Genuine Parts Co. v. Cepec, 137 A.3d 123, 129 (Del. 2016).
12

show the amenability of the defendant to service of process.’”

33

 When a defendant 

moves to dismiss under Rule 12(b)(2), the plaintiff has the burden to show a prima 

facie case of personal jurisdiction over a nonresident defendant by demonstrating 

“specific facts,” and not “rely[ing] on mere conclusory assertions.”34 “While such a 

showing is frequently made on the basis of documentary evidence and affidavits, 

and sometimes deposition or live testimony, in appropriate circumstances, a plaintiff 

also may make the necessary prima facie showing using only the facts alleged in the 

complaint.”

35

 Delaware courts can exercise personal jurisdiction over nonresident 

defendants by consent through conduct,36 statutory means,37 or by “dint of a 

contractual arrangement.”38

33 Neurvana Med., LLC v. Balt USA, LLC (Neurvana I), 2019 WL 4464268, at *2 (Del. Ch. 

Sept. 18, 2019) (quoting Ruggiero v. FuturaGene, plc., 948 A.2d 1124, 1131 (Del. Ch. 

2008)).

34 Mobile Diagnostic Gp. Hldgs., LLC v. Suer, 972 A.2d 799, 802 (Del. Ch. 2009) (citations 

omitted).

35 Donald J. Wolfe, Jr. & Michael A. Pittenger, Corporate and Commercial Practice in the 

Delaware Court of Chancery § 3.02, at 3-7 (2022) (internal quotation marks omitted) 

(quoting Canadian Com. Workers Indus. Pension Plan v. Alden, 2006 WL 456786, at *11 

n.93 (Del. Ch. Feb. 22, 2006), and citing N. Am. Cath. Educ. Programming Found., Inc. v. 

Gheewalla, 2006 WL 2588971, at *6 n.63 (Del. Ch. Sept. 1, 2006), aff’d, 930 A.2d 92 

(Del. 2007)).

36 E.g., Ross Hldg. & Mgmt. Co. v. Advance Realty Gp., LLC, 2010 WL 1838608, at *11

(Del. Ch. Apr. 28, 2010) (citing Hornberger Mgmt. Co. v. Haws & Tingle Gen. 

Contractors, Inc., 768 A.2d 983, 989 (Del. Super. 2000)).

37 E.g., Mobile Diagnostic, 972 A.2d 799, 803 (Del. Ch. 2009); BAM Int’l, LLC v. MSBA 

Gp. Inc., 2021 WL 5905878, at *5 (Del. Ch. Dec. 14, 2021).

38 BAM Int’l, 2021 WL 5905878, at *6.
13

“Where the parties to the forum selection clause have consented freely and 

knowingly to the court’s exercise of jurisdiction, the clause is sufficient to confer 

personal jurisdiction on a court.”39 Consent renders a “minimum contacts” analysis 

unnecessary.40 Contractual consent to jurisdiction only extends to claims identified 

by and encompassed by the consent provision.41 “Forum selection/consent to 

jurisdiction clauses are ‘presumptively valid’ and should be ‘specifically’ enforced 

unless the resisting party ‘could clearly show that enforcement would be 

unreasonable and unjust, or that the clause was invalid for such reasons as fraud and 

overreaching.’”

42

39 Nat’l Indus. Gp. (Hldg.) v. Carlyle Inv. Mgmt. L.L.C., 67 A.3d 373, 381 (Del. 2013) 

(citing Nat’l Equip. Rental, Ltd. v. Szukhent, 375 U.S. 311, 315–16 (1964)); accord Solae, 

LLC v. Hershey Can., Inc., 557 F. Supp. 2d 452, 456 (D. Del. 2008) (citing Res. Ventures, 

Inc. v. Res. Mgmt. Int’l, Inc., 42 F.Supp.2d 423, 431 (D. Del. 1999)).

40 Ingres Corp. v. CA, Inc., 8 A.3d 1143, 1145 (Del. 2010) (“[W]here contracting parties 

have expressly agreed upon a legally enforceable forum selection clause, a court should 

honor the parties’ contract and enforce the clause, even if, absent any forum selection 

clause, the [common law] principle might otherwise require a different result.” (collecting 

authorities)); see BAM Int’l, 2021 WL 5905878, at *6.

41 Ruggiero, 948 A.2d at 1132 (“Of course, the party is bound only by the terms of the 

consent, and such consent applies only to those causes of action that are identified in the 

consent provision.”); Multi-Fineline Electronix, Inc. v. WBL Corp., 2007 WL 431050, at 

*6–7 (Del. Ch. Feb. 2, 2007) (finding defendants did not actually consent to jurisdiction 

because the complaint did not plead a dispute within the scope of the forum selection 

clause).

42 Cap. Gp. Cos., Inc. v. Armour, 2004 WL 2521295, at *3 (Del. Ch. Oct. 29, 2004)

(quoting M/S Bremen v. Zapata Off-Shore Co., 407 U.S. 1, 15 (1972), and citing Burger 

King v. Rudzewicz, 471 U.S. 462, 472 n.14 (1985)); accord Salzberg v. Sciabacucchi, 227 

A.3d 102, 135 (Del. 2020) (citing and quoting Bremen, 407 U.S. at 15).
14

Plaintiff alleges that the Individual Defendants effectively consented to this 

Court’s jurisdiction pursuant to the Merger Agreement’s forum selection clause

because they were intended third-party beneficiaries of, or closely related to, the 

Merger Agreement.43 Section 9.8(b) provides, in pertinent part:

The Parties hereby irrevocably submit to the exclusive jurisdiction of 

the Court of Chancery of the State of Delaware sitting in Wilmington, 

Delaware (or if such court lacks jurisdiction, in any appropriate state or 

federal court in the State of Delaware sitting in Wilmington, Delaware) 

over all claims or causes of action (whether in contract or tort) that may 

be based upon, arise out of or relate to this Agreement, or the 

negotiation, execution or performance of this Agreement (including 

any claim or cause of action based upon, arising out of or related to any

representation or warranty made in or in connection with this 

Agreement or as an inducement to enter into this Agreement) and each 

Party hereby irrevocably agrees that all claims in respect of any such 

Action related thereto may be heard and determined in such courts.44

43 Compl. ¶ 24; AB at 31–32. Plaintiff does not claim the Individual Defendants consented 

to jurisdiction under the Contribution and Exchange Agreement’s forum selection clause. 

See id.; Compl. Ex. B § 4.8(b). But because Plaintiff’s theory is pinned to the exchange of 

Holdings units under the Contribution and Exchange Agreement, I note for the sake of 

completeness that the Individual Defendants are not “Parties,” signatories, or third-party 

beneficiaries to the Contribution and Exchange Agreement. Compl. Ex. B at Preamble; id.

§ 4.6 (“Nothing express or implied in this Agreement is intended or shall be construed to 

confer upon or give any person other than the parties and their respective successors and 

permitted assigns any right, benefit or remedy under or by reason of this Agreement.”). 

Plaintiff does not argue the Individual Defendants received any benefit from the 

Contribution and Exchange Agreement, nor that it was foreseeable they would be bound. 

See Emerald P’rs v. Berlin, 726 A.2d 1215, 1224 (Del. 1999) (“Issues not briefed are 

deemed waived.”).

44 Compl. Ex. A § 9.8(b).
15

The Individual Defendants are not “Parties” to the Merger Agreement.45 And 

as a foundational principle, “Delaware law clearly holds that officers of a 

corporation are not liable on corporate contracts as long as they do not purport to 

bind themselves individually.”46 While Marshall signed the Merger Agreement on 

ShootProof’s behalf, there is no evidence that either of the Individual Defendants 

purported to bind themselves individually to the Merger Agreement. 

But Delaware law provides a framework for considering whether a forum 

selection clause is enforceable against those who are not otherwise individually 

bound by the agreement. Capital Group Companies, Inc. v. Armour explains:47

[A] court can enforce a forum selection provision against a nonsignatory if the following three elements are met: (i) the agreement 

contains a valid forum selection provision; (ii) the non-signatory has a 

sufficiently close relationship to the agreement, either as an intended 

third-party beneficiary under the agreement or under principles of 

estoppel; and (iii) the claim potentially subject to the forum selection 

provision arises from the non-signatory’s standing relating to the 

agreement.48

45 Id. at Preamble.

46 Ruggiero, 948 A.2d at 1132 (internal quotation marks omitted) (quoting Amaysing Tech. 

Corp. v. CyberAir Commc’ns, Inc., 2005 WL 578972, at *3 (Del. Ch. Mar. 3, 2005)); 

accord Brown v. Colonial Chevrolet Co., 249 A.2d 439, 441 (Del. Super. 1968) (“As a 

general rule, so far as personal liability on corporate contracts is concerned, officers of 

corporations are in the same position as agents of private individuals and are not liable on 

corporate contracts as long as they do not act and purport to bind themselves individually.”

(citing 19 AM. JUR. 2D Corporations § 1341 (1965))).

47 2004 WL 2521295, at *5.

48 Fla. Chem. Co., LLC v. Flotek Indus., Inc., 262 A.3d 1066, 1090 (Del. Ch. 2021) (citing 

Cap. Gp., 2004 WL 2521295, at *5, and Neurvana I, 2019 WL 4464268, at *3), cert. denied
16

“For a non-signatory to be bound by a contract’s forum selection clause, the answer 

to all three questions must be yes.”

49

Here, the parties do not dispute the first or third elements as to the whether 

the Individual Defendants are bound by the Merger Agreement: they only dispute 

the second.

50

 “Under the second element of the Capital Group test, a forum selection 

provision can bind a non-signatory that has a sufficiently close relationship to the 

agreement, either as an intended third-party beneficiary under the agreement or 

based on principles of estoppel.”

51

 

The Individual Defendants are not intended third-party beneficiaries to the 

Merger Agreement. Section 9.13 of the Merger Agreement provides:

2021 WL 4170712 (Del. Ch. 2021); see id. at 1093 (addressing the third element and noting 

that “[d]espite making passing mention of standing, the [Capital Group] decision seems to 

have simply analyzed whether the claims fell within the scope of the forum selection 

provision.”); id. at 1093–97 (analyzing the third Capital Group element).

49 Sustainability P’rs LLC v. Jacobs, 2020 WL 3119034, at *5 (Del. Ch. June 11, 2020) 

(citing Neurvana I, 2019 WL 4464268, at *3).

50 Hr’g Tr. 84; AB at 31; OB at 36–37; RB at 24–27.

51 Fla. Chem. Co., 262 A.3d at 1090.
17

Third-Party Beneficiaries. Except for the D&O Indemnified Person 

who shall have the right to enforce their respective rights under Section 

7.5 and as contemplated by Section 7.6, and Article 8, nothing in this 

Agreement, express or implied, is intended to confer upon any Person 

other than the Parties any rights or remedies of any nature whatsoever

under or by reason of this Agreement. From and after the Closing, all 

of the Persons identified as third-party beneficiaries in the immediately 

preceding sentence shall be entitled to enforce such provisions and to 

avail themselves of the benefits of any remedy for any breach of such 

provisions, all to the same extent as if such Persons were parties to this 

Agreement.52

In other words, only “D&O Indemnified Person[s]” with rights under Section 7.5 are 

intended third-party beneficiaries. Section 7.5 provides for indemnification of the 

Company’s directors and officers. It defines “D&O Indemnified Persons” as “each 

present and former director and officer of the Company.”53 The “Company” is 

defined as Collage.54 The Individual Defendants were officers of ShootProof and 

Foreground, but not Collage.55 Accordingly, the Individual Defendants are not 

intended third-party beneficiaries to the Merger Agreement. 

The Individual Defendants are also not bound by principles of estoppel. 

Those principles can bind nonsignatories who are “closely related” to an 

52 Compl. Ex. A § 9.13 (emphasis omitted).

53 Id. § 7.5(a).

54 Id. at Preamble.

55 Compl. ¶¶ 1, 16, 17; OB at 7.
18

agreement.56 They do so only if: (1) “the party receives a direct benefit from the 

agreement”; or (2) “it was foreseeable that the party would be bound by the 

agreement.”57 “Although the direct-benefit and foreseeability inquiries have been 

articulated as disjunctive, many Delaware cases have relegated the foreseeability 

inquiry to a subordinate role.”58

Plaintiff argues the Individual Defendants received a direct benefit from the 

Merger Agreement under Baker v. Impact Holding, Inc.59 Specifically, Plaintiff 

asserts the Individual Defendants directly benefitted from the Merger Agreement 

because they became officers in the post-transaction entity, Foreground.60 In Baker, 

the Court found that where a stock purchase agreement “expressly name[d]” a party 

as a director, he received a direct benefit that bound him to that agreement.61 That 

56 Fla. Chem., 262 A.3d at 1092; Neurvana I, 2019 WL 4464268, at *4 (internal quotation 

marks omitted) (quoting iModules Software, Inc. v. Essenza Software, Inc., 2017 WL 

6596880, at *3 (Del. Ch. Dec. 22, 2017) (ORDER), and citing Cap. Gp., 2004 WL 

2521295, at *6 nn.40 & 41).

57 Baker v. Impact Hldg., Inc., 2010 WL 1931032, at *4 (Del. Ch. May 13, 2010) (citing 

Weygandt v. Weco, LLC, 2009 WL 1351808, at *4 (Del. Ch. May 14, 2009)); accord Fla. 

Chem., 262 A.3d at 1090–94.

58 Neurvana I, 2019 WL 4464268, at *5 (footnote omitted) (citing McWane, Inc. v. Lanier, 

2015 WL 399582, at *8 (Del. Ch. Jan. 30, 2015)).

59 2010 WL 1931032.

60 AB at 31–32.

61 Baker, 2010 WL 1931032, at *4.
19

party sued to enforce that benefit “received via the [agreement],” and was bound by 

its forum selection clause.62 

Not so with the Individual Defendants. Unlike the agreement in Baker, the 

Merger Agreement did not “expressly name[]” them to their posts in the posttransaction entity.

63

 Those positions were not “received via the” Merger 

Agreement.64 “This Court’s case law on this point is clear: to be bound by forum 

selection clauses, non-signatories must actually receive a benefit under or by way of 

the contract.”

65

 That the Individual Defendants stayed on when ShootProof became 

Foreground is insufficient to bind the Individual Defendants to the Merger 

Agreement as nonsignatories.

Turning from direct benefit to foreseeability, this Court has applied the 

foreseeability inquiry as a standalone basis for satisfying the closely-related test in 

two scenarios: (1) where a nonsignatory defendant seeks to enforce a forum 

selection clause against a signatory plaintiff;66 or (2) where a controlled 

nonsignatory, who bears a “clear and significant connection to the subject matter of 

62 Id.

63 Id.

64 Id.

65 Sustainability P’rs, 2020 WL 3119034, at *6 (emphasis omitted and emphasis added).

66 Neurvana I, 2019 WL 4464268, at *5–6 (citing Ashall Homes Ltd. v. ROK Entm’t Gp., 

Inc., 992 A.2d 1239, 1249 (Del. Ch. 2010), and Lexington Servs. Ltd. v. U.S. Patent No. 

8019807 Delegate, LLC, 2018 WL 5310261, at *5–6 (Del. Ch. Oct. 26, 2018)).
20

the agreement,” could be manipulated by controller signatories in an “end-run” 

around the agreement’s forum selection clause.67 “[T]he test should not extend to 

all non-signatories that a signatory ‘happens to control.’”68

These facts do not resemble any of those limited scenarios. Plaintiff argues 

that the Individual Defendants are “closely-related to the [Merger Agreement] in 

such a way that it would be foreseeable that they would be bound” because they 

“were the CEO and CFO of ShootProof . . . and they were the lead negotiators for 

ShootProof with regard to the Merger Agreement.”69 The Individual Defendants’ 

positions as officers and their contacts with the negotiating process are insufficient 

to bind them to the Merger Agreement under the foreseeability prong.70 I conclude 

the Individual Defendants have not implicitly consented to the Merger Agreement’s 

forum selection clause as nonsignatories under the Capital Group test.

Plaintiff alternatively alleges the Individual Defendants are subject to this 

Court’s jurisdiction under 10 Del. C. § 3104. Where a nonresident defendant has

not consented to personal jurisdiction, state courts can exercise personal jurisdiction 

67 Id. at *6 (citing and quoting iModules, 2017 WL 6596880, at *3–4, and then Weygandt, 

2009 WL 1351808, at *2, *4–6, and then Ashall Homes, 992 A.2d at 1248).

68 Id. (quoting iModules, 2017 WL 6596880, at *3).

69 AB at 31 (internal quotation marks omitted) (quoting Carlyle Inv. Mgmt. LLC v. 

Moonmouth Co. SA, 779 F.3d 214, 219 (3d Cir. 2015), and then citing Compl. ¶ 46); see 

also AB at 32 (citing Compl. ¶¶ 25, 38, 41, 46, 56, 64, and Compl. Ex. A).

70 See supra note 46 and accompanying text.
21

over her by either general jurisdiction or specific jurisdiction.71 In both cases, 

Delaware courts apply a two-prong analysis to determine whether the plaintiff 

satisfied its burden.72 First, courts consider whether the defendant has sufficient 

contacts for statutory jurisdiction.73 Section 3104(c)(3) is “a ‘single act’ statute that 

establishes jurisdiction over nonresidents on the basis of a single act or transaction 

engaged in by the nonresident within the state.”74 Thus, Section 3104(c)(3) permits 

the exercise of “specific personal jurisdiction over claims arising from the 

jurisdictional contacts” at issue.75 Second, should the court find the long-arm statute 

applies, it “must ‘evaluate whether subjecting the nonresident to jurisdiction in 

Delaware violates the Due Process Clause of the Fourteenth Amendment (the socalled ‘minimum contacts’ requirement).’”76

 

Plaintiff asserts specific jurisdiction over the Individual Defendants is 

warranted because they “engaged in substantial acts which caused the merger of two 

71 See Genuine Parts, 137 A.3d at 129–30.

72 Mobile Diagnostic, 972 A.2d at 802.

73 Id. at 803; Genuine Parts, 137 A.3d at 127 (noting that in the circumstance where 

Delaware cannot exercise general jurisdiction over a foreign corporation, the analysis turns 

to specific jurisdiction under the long-arm statute).

74 Carlton Invs. v. TLC Beatrice Int’l Hldgs., Inc., 1995 WL 694397, at *10 (Del. Ch. 

Nov. 21, 1995) (citing Eudaily v. Harmon, 420 A.2d 1175, 1180 (Del. 1980), and Tabas v. 

Crosby, 444 A.2d 250, 254 (Del. 1982)).

75 Id.

76 Mobile Diagnostic, 972 A.2d at 803 (quoting AeroGlobal Cap. Mgmt., LLC v. Cirrus 

Indus., Inc., 871 A.2d 428, 438 (Del. 2005)).
22

Delaware corporations,” “are or were officers or directors of Delaware entities, 

including [Holdings GP] and [a] nonparty . . . Delaware corporation created for the 

purpose of the transaction that is the subject of th[e] complaint,” and “made various 

fraudulent statements that give rise to the cause of action underlying the 

Complaint.”77 None of these acts support long-arm jurisdiction. “Causing” a merger 

governed by Delaware law, by itself, does not satisfy Section 3104(c).78 A Delaware 

court cannot exercise personal jurisdiction over a director or officer for an act of the 

corporation simply because the officer or director directed the corporation to take 

that act.79

Neither does the creation of the Delaware corporation, Collage Merger Sub 

Inc., that merged into Collage to create Foreground.80 Plaintiff does not allege the 

Individual Defendants formed the Delaware entity, only that they were officers or 

77 Compl. ¶¶ 25–26; AB at 34. Plaintiff’s answering brief does not cite 10 Del. C. § 3114; 

any argument under that statute is waived. Emerald P’rs, 726 A.2d at 1224.

78 See Fortis Advisors LLC v. Johnson & Johnson, 2021 WL 5893997, at *6–7 (Del. Ch. 

Dec. 13, 2021) (finding merger did not create long-arm jurisdiction over individual 

defendants where negotiations did not take place in Delaware and the relevant statements 

were not made within the state).

79 E.g., Microsoft Corp. v. Amphus, Inc., 2013 WL 5899003, at *10 n.40 (Del. Ch. 

Oct. 31, 2013) (“Where a director acts solely in that capacity to cause a corporation to take 

action, the corporation’s action will not be attributed to the director for purposes of 

jurisdiction unless the plaintiff can establish that the corporation was acting as the 

director’s agent or alter ego.” (citation omitted)).

80 Compl. ¶¶ 25–26; Compl. Ex. A at Recitals.
23

directors thereof.81 Even if he had so alleged, “merely participating in the formation 

of a Delaware entity, without more, does not create a basis for jurisdiction in 

Delaware.”82 “Instead, ‘the formation of a Delaware entity must be central to the 

plaintiff’s claims of wrongdoing.’”83 While the creation of the merger subsidiary 

was a necessary step to complete the merger, it “cannot reasonably be viewed as an 

integral part of the wrongdoing by the individual defendants alleged in the 

Complaint.”84

Finally, Plaintiff contends the Individual Defendants made various false 

statements in violation of Washington securities law. But the merger negotiations 

did not take place in Delaware, the relevant statements were not made in Delaware, 

and Plaintiff was not in Delaware when he received them.

85

 Indeed, Plaintiff’s 

Washington securities law claims hinge on his injury having taken place in 

Washington. The injuries allegedly suffered have no nexus to Delaware. The 

81 Compl. ¶¶ 25–26.

82 Conn. Gen. Life Ins. Co. v. Pinkas, 2011 WL 5222796, at *2 (Del. Ch. Oct. 28, 2011).

83 Fortis, 2021 WL 5893997, at *7 (quoting Dow Chem. Co. v. Organik Kimya Hldg. A.S., 

2017 WL 4711931, at *8 (Del. Ch. Oct. 19, 2017)).

84 Id.

85 E.g., Compl. ¶ 108 (“Defendants made the material misrepresentations alleged herein to 

Joe . . . who was in Washington State. Defendants also engaged in the transaction at issue, 

including the sale of securities to Joe while Joe was in Washington State. Defendants also 

knew that Joe was going to acquire securities from his location in Washington State, and 

he did in fact acquire securities from his location in Washington State.”).
24

Individual Defendants lack have committed no act in Delaware supporting specific 

statutory jurisdiction.

For the reasons explained, this Court does not have personal jurisdiction over 

the Individual Defendants and the Complaint is therefore dismissed as to them 

pursuant to Rule 12(b)(2). I decline to grant Plaintiff jurisdictional discovery.86

B. Plaintiff Fails To State A Claim Under Rule 12(b)(6).

Defendants also move to dismiss the Complaint under Court of Chancery Rule 

12(b)(6) for failure to state a claim for relief. The standard for a motion to dismiss 

under Rule 12(b)(6) is well-settled:

(i) all well-pleaded factual allegations are accepted as true; (ii) even 

vague allegations are “well-pleaded” if they give the opposing party 

notice of the claim; (iii) the Court must draw all reasonable inferences 

in favor of the non-moving party; and ([iv]) dismissal is inappropriate 

unless the “plaintiff would not be entitled to recover under any 

reasonably conceivable set of circumstances susceptible to proof.”87

86 Neurvana Med., LLC v. Balt USA, LLC (Neurvana II), 2019 WL 5092894, at *2 (Del. 

Ch. Oct. 10, 2019) (“[T]he decision to grant jurisdictional discovery is discretionary.”); In 

re Am. Int’l Gp., Inc., 965 A.2d 763, 816 n.195 (Del. Ch. 2009) (“It is also not appropriate 

to give the Stockholder Plaintiffs the benefit of jurisdictional discovery so they can fish for 

a possible basis for this court’s jurisdiction. Before ordering personal jurisdiction 

discovery there must be at least ‘some indication that this particular defendant is amenable 

to suit in this forum.’” (quoting Hansen v. Neumueller GmbH, 163 F.R.D. 471, 475 (D. Del. 

1995))), aff’d sub nom. Tchrs.’ Ret. Sys. of La. v. PricewaterhouseCoopers LLP, 11 A.3d 

228 (Del. 2011) (TABLE).

87 Savor, Inc. v. FMR Corp., 812 A.2d 894, 896–97 (Del. 2002).
25

Thus, the touchstone “to survive a motion to dismiss is reasonable 

‘conceivability.’”88 This standard is “minimal”89 and plaintiff-friendly.90 “Indeed, 

it may, as a factual matter, ultimately prove impossible for the plaintiff to prove [its]

claims at a later stage of a proceeding, but that is not the test to survive a motion to 

dismiss.”91 Despite this forgiving standard, the Court need not accept conclusory 

allegations unsupported by specific facts or draw unreasonable inferences in favor 

of the nonmoving party.92 “Moreover, the court is not required to accept every 

strained interpretation of the allegations proposed by the plaintiff.”93

Counts I and II both allege violations of Washington State’s Blue Sky Laws

based on extracontractual assurances made to Plaintiff during negotiations to the 

effect that he, his spouse, and his Collage colleagues would keep their jobs after the 

merger.

94

 Count I alleges Defendants made material misrepresentations in 

88 Cent. Mortg. Co. v. Morgan Stanley Mortg. Cap. Hldgs. LLC, 27 A.3d 531, 536–37 (Del.

2011).

89 Id. at 536.

90 E.g., Clouser v. Doherty, 175 A.3d 86, 2017 WL 3947404, at *9 (Del. 2017) (TABLE)

(citing Malpiede v. Townson, 780 A.2d 1075, 1082 (Del. 2001)).

91 Cent. Mortg. Co., 27 A.3d at 536.

92 E.g., Clinton v. Enter. Rent-A-Car Co., 977 A.2d 892, 895 (Del. 2009) (citations 

omitted).

93 In re Trados Inc. S’holder Litig., 2009 WL 2225958, at *4 (Del. Ch. July 24, 2009)

(internal quotation marks omitted) (quoting In re Gen. Motors (Hughes) S’holder Litig., 

897 A.2d 162, 168 (Del. 2006)).

94 E.g., Compl. ¶¶ 39, 41, 45, 59–66, 106–121; AB at 6–10, 20.
26

connection with the sale of Holdings’s securities in violation of the Revised Code of 

Washington (“RCW”) 21.20.010.

95

 RCW 21.20.010(2) provides that: “[i]t is 

unlawful for any person, in connection with the offer, sale or purchase of any 

security, directly or indirectly . . . (2) [t]o make any untrue statement of a material 

fact or to omit to state a material fact necessary in order to make the statements made, 

in the light of the circumstances under which they are made, not misleading.”96 This 

provision was modeled on Section 101 of the Uniform Securities Act of 1956 and is 

substantially similar to Rule 10b-5 of the Securities Exchange Act.97 To plead a 

claim under RCW 21.20.010(2), a plaintiff must demonstrate that: (1) the defendant 

made a statement “in connection with the offer, sale or purchase of any security, 

directly or indirectly;”98 and (2) the statement was an “untrue statement of material 

fact” or an omission of a material fact that, “in light of the circumstances under 

which [the statements] are made,” would be misleading.99

Count II alleges PSG, Holdings GP, and the Individual Defendants are liable 

under RCW 21.20.430 for PSG and ShootProof’s alleged violations of RCW 

95 Compl. ¶¶ 106–113; id. at 17.

96 RCW 21.20.010(2).

97 See Fed. Home Loan Bank of Seattle v. Credit Suisse Sec. (USA) LLC, 449 P.3d 1019, 

1022, 1027 (Wash. 2019).

98 Defendants do not challenge this element. RB at 6 n.10; AB at 13; Hr’g Tr. 64.

99 RCW 21.20.010(2).
27

21.20.010.

100

 A finding on Count II necessarily depends on whether Plaintiff has 

stated a claim in Count I.101 I begin with Count I.

Defendants argue Plaintiff has failed to overcome the antireliance provision 

in the Contribution and Exchange Agreement and the integration provisions in that 

agreement and the Merger Agreement.102 Alternatively, Defendants assert Plaintiff

failed to allege the extracontractual statements were false when made. I need only 

address Defendants’ first argument.

100 Compl. ¶¶ 114–121; id. ¶ 120 (“PSG and ShootProof committed violations of RCW 

21.20.010.”). Under RCW 21.20.430, a person who buys or sells securities in violation of 

RCW 21.20.010, or a person who directly or indirectly controls a buyer or seller who 

transacted securities in violation of RCW 21.20.010 is liable to the counterparty in the 

securities transaction. RCW 21.20.430(1)–(3). It is unclear whether Plaintiff is pursuing 

Count II under RCW 21.20.430(2) against the identified Defendants as sellers, or just RCW 

21.20.430(3) against the identified Defendants as alleged controllers of the sellers. Compl. 

¶¶ 114–121.

101 RCW 21.20.430(1) (“Any person, who offers or sells a security in violation of any

provisions of RCW 21.20.010, . . . is liable to the person buying the security from him or 

her . . . .”); RCW 21.20.430(2) (“Any person who buys a security in violation of the 

provisions of RCW 21.20.010 is liable to the person selling the security to him or 

her . . . .”); RCW 21.20.430(3) (“Every person who directly or indirectly controls a seller 

or buyer liable under subsection (1) or (2) above, every partner, officer, director or person 

who occupies a similar status or performs a similar function of such seller or buyer, . . . is 

also liable jointly and severally with and to the same extent as the seller or buyer . . . .”).

102 The Merger Agreement is mutually integrated with the Contribution and Exchange 

Agreement. Compl. Ex. B § 4.7; Compl. Ex. A § 9.2. The Merger Agreement also has an 

antireliance provision. Compl. Ex. A § 8.10. Defendants only wield the provisions in the 

Contribution and Exchange Agreement and the Merger Agreement’s integration provision, 

perhaps because the Merger Agreement’s antireliance provision in Section 8.10 only 

applies to ShootProof and its representatives. E.g., OB at 10, 18 & n.60; RB at 7 n.11;

Compl. Ex. A § 8.10.
28

1. Sections 2.2(n) And 4.7 Of The Contribution And Exchange 

Agreement Do Not Violate Washington’s Antiwaiver Statute 

And Are Not Void.

Plaintiff asserts the antireliance and integration provisions must be void as 

against Washington securities law claims because they are waivers of such claims, 

and such waivers are precluded by Washington statute. Plaintiff asserts that a 

provision trimming actionable statements to only those on which a plaintiff can rely 

is an impermissible waiver of otherwise actionable securities claims, and therefore 

void under RCW 21.20.430(5). As I read Washington law, these provisions are 

permissible and not void.

Washington’s securities laws provide that parties cannot contractually waive 

compliance with those laws. Under RCW 21.20.430(5), “[a]ny condition, 

stipulation, or provision binding any person acquiring any security to waive 

compliance with any provision of this chapter or any rule or order hereunder is 

void.”103 Washington courts have described this section as evidencing the 

Washington legislature’s “intention to hold violators strictly accountable” by 

“prohibit[ing] a purchaser . . . from contractually agreeing to waive the protections 

103 RCW 21.20.430(5).
29

of the Act’s remedy provision.”104 In perhaps a more familiar context for Delaware 

readers, the Exchange Act contains an identical provision in Section 29(a).105

In 2004, the Washington Court of Appeals in Stewart v. Estate of Steiner held

a waiver or release of Washington securities claims is distinguishable from a waiver 

of compliance with the Securities Act of Washington: it instructed that merely 

limiting the bases for a fraud action “does not require anyone to waive compliance 

with the [Securities Act of Washington].”106 Stewart rejected the argument that a 

subscription agreement’s nonreliance provision violated RCW 21.20.430(5)’s 

antiwaiver language.

107

 

104 Go2net, Inc. v. Freeyellow.Com, Inc., 143 P.3d 590, 592 (Wash. 2006) (discussing 

RCW 21.20430(5) and itsresulting effect) (internal quotation marks omitted) (quoting 

Go2Net, Inc. v. Freeyellow.com, Inc., 109 P.3d 875, 881 (Wash. Ct. App. 2005), aff’d, 143 

P.3d 590).

105 See 15 U.S.C. § 78cc(a). But see Kittilson v. Ford, 608 P.2d 264, 265 (Wash. 1980) 

(“The coordination of the federal courts with federal regulations does not require imitation 

by this court in construing our act, only that our construction not interfere with the federal 

scheme.” (citation omitted)).

106 Stewart v. Est. of Steiner, 93 P.3d 919, 925 (Wash. Ct. App. 2004).

107 Id. (citing Harsco Corp. v. Segui, 91 F.3d 337, 343–44 (2d Cir. 1996)). Stewart also 

held that Washington’s securities laws required a plaintiff to prove reliance on the 

misrepresentation. Id. at 924; see also FMC Techs., Inc. v. Edwards, 2007 WL 1725098, 

at *4 (W.D. Wash. June 12, 2007) (noting the significance of a valid antireliance provision 

in the context of an otherwise investor-friendly securities law claim requiring a 

determination of reasonable reliance), aff’d, 302 F. App’x 577 (9th Cir. 2008). But in 2019, 

the Washington Supreme Court in Federal Home Loan Bank of Seattle v. Credit Suisse 

Securities (USA) LLC held that “reliance is not an element of a private securities claim 

under [RCW 21.20.010(2)].” 449 P.3d at 1021. 

Plaintiff argues Federal Home Loan also set aside Stewart’s characterization of a 

nonreliance provision as a proper limitation on grounds for a securities claim rather than 
30

Stewart relied on Harsco Corp. v. Segui by the United States Court of Appeals 

for the Second Circuit, which provides that while integration and nonreliance clauses 

“limit[] the bases upon which a fraud action could be brought,” they do not run afoul 

of the analogous “anti-waiver” provision of the Securities Exchange Act’s Section 

29(a).108 The Second Circuit distinguished between “a contractual provision which 

prohibits a party from suing at all,” which would violate Section 29(a), and 

integration and nonreliance clauses.109 And in 2022, the United States District Court 

for the Western District of Washington in Zunum Aero, Inc. v. Boeing Company

an improper waiver. Plaintiff also argues that because reliance is no longer an element of 

a Washington securities law claim, a nonreliance clause cannot preclude a Washington 

securities law claim. According to Plaintiff, enforcing an antireliance provision would 

improperly limit those claims only to statements on which a plaintiff relied, in 

contravention of Federal Home Loan Bank’s removal of reliance as an element of those 

claims. See 449 P.3d at 1021. 

But, as best I can tell, Washington law still permits such limitations. No language 

in Federal Home Loan addresses the validity of a nonreliance clause. See generally Fed. 

Home Loan, 449 P.3d 1019. And last year, the District Court for the Western District of 

Washington enforced contractual acknowledgements of certain facts as limitations on what 

statements the plaintiff could point to as fraudulent—and cited Stewart. Zunum Aero, Inc. 

v. Boeing Co., 2022 WL 2116678, at *14 (W.D. Wash. June 13, 2022) (agreeing with 

defendant that “Zunum cannot for purposes of this claim disavow these contractual 

acknowledgments and contend that it was misled” in violation of RCW 21.20.010(2) 

(citing Stewart, 93 P.3d at 924, and Hammond v. Everett Clinic, PLLC, 2021 WL 961130, 

at *5–6 (Wash. Ct. App. Mar. 15, 2021)), reconsid. denied, 2022 WL 2342891, at *5 (W.D. 

Wash. June 29, 2022) (denying reconsideration of its holding that the contracts at issue 

foreclosed the plaintiff’s securities fraud claim). I read Zunum to stand for the proposition 

that even after Federal Home Loan clarified that reliance is not an element of a Washington 

securities fraud claim, contractual provisions can still properly operate to limit the universe 

of statements on which a plaintiff can bring a claim.

108 Harsco, 91 F.3d at 343–44.

109 Id. at 344.
31

dismissed a claim under RCW 21.20.010(2) because the contract foreclosed 

misrepresentation claims, citing Stewart.

110

 I read Washington common law to hold 

that contractual provisions can properly limit the universe of actionable 

misrepresentations without running afoul of the statutory prohibition against 

waiving compliance with securities law.111 

Sections 2.2(n) and 4.7 of the Contribution and Exchange Agreement do not 

operate as a waiver in violation of RCW 21.20.430(5). The plain language of 

Contribution and Exchange Agreement Sections 2.2(n) and 4.7 do not require 

Plaintiff or anyone to “waive compliance with any provision . . . or any rule or any 

order” under the Securities Act of Washington.112 Nor do they prohibit Plaintiff 

110 Zunum, 2022 WL 2116678, at *14 (citing Stewart, 93 P.3d at 924, and Hammond, 2021 

WL 961130, at *5–6); id. at *15 (“Zunum fails to state a plausible securities fraud claim 

because the 2016 PIA and 2017 and 2018 IRLs foreclose its claim . . . .”).

111 Plaintiff looks to law outside Washington to argue that antireliance and integration 

provisions violate the Securities Act of Washington’s antiwaiver provision. Given 

Washington’s binding authority on the matter, Plaintiff’s cited authorities are not 

persuasive. E.g., Zunum, 2022 WL 2116678, at *14 (citing Stewart, 93 P.3d at 924, and 

Hammond, 2021 WL 961130, at *5–6); Stewart, 93 P.3d at 924–25; Kittilson, 608 P.2d at

265 (holding that coordination with federal courts interpreting federal securities law “does 

not require imitation” by Washington courts “in construing [Washington’s securities] act, 

only that [Washington’s] construction not interfere with the federal scheme”). See AES 

Corp. v. Dow Chem. Co., 325 F.3d 174, 181–82 (3d Cir. 2003) (holding that reliance is an 

element of a Rule 10b-5 claim, and that enforcing a nonreliance clause is inconsistent with 

Section 29(a)’s prohibition on anticipatory waiver); Kronenberg v. Katz, 872 A.2d 568, 

593, 597–98 (Del. Ch. 2004) (noting an integration clause alone, unaccompanied by a 

nonreliance clause, cannot bar a Pennsylvania blue sky claim based on extracontractual 

statements, and explaining “[p]arties who wish to protect themselves against fraud claims 

can seek explicit anti-reliance language that will have that effect”).

112 RCW 21.20.430(5); Stewart, 93 P.3d at 925.
32

from suing at all.113 Section 2.2(n) of the Contribution and Exchange Agreement 

provides:

Representations and Warranties of the Rollover Sellers. To induce the 

Partnership to issue the Partnership Units as herein provided, each 

Rollover Seller (severally and not jointly) hereby represents and 

warrants to the Partnership as follows: . . . (n) Such Rollover Seller 

acknowledges that the only representations and warranties made by or 

on behalf of the Partnership are the representations and warranties 

expressly set forth in Sections 2.1 and, except for the representations 

and warranties expressly set forth in Sections 2.1, such Rollover Seller 

has not relied upon any other express or implied representations or 

warranties or any other information.114

Plaintiff is a “Rollover Seller” under the Contribution and Exchange Agreement.115 

Section 4.7 provides:

113 Harsco, 91 F.3d at 344. In connection with the transaction, Plaintiff also executed a 

“Restrictive Covenants Agreement.” See Compl. Ex. B § 4.7 (integrating the Contribution 

and Exchange Agreement with the Merger Agreement and “Ancillary Documents referred 

to herein or therein”); Compl. Ex. A § 1.1 (defining “Ancillary Documents” to include 

“each Restrictive Covenants Agreement”). Defendants acknowledged they “are not 

moving to dismiss the Complaint on the basis of the release or covenant not to sue [in the 

Restrictive Covenants Agreement] because they are cognizant of the ‘anti-waiver’ 

language of the [Securities Act of Washington].” OB at 9 n.26; AB at 20 (quoting OB at 

9 n.26). The Restrictive Covenants Agreement is not integral to the Complaint, so I do not 

reach whether it operates as an impermissible waiver under RCW 21.20.430(5). Fortis 

Advisors LLC v. Allergan W.C. Hldg. Inc., 2019 WL 5588876, at *3 (Del. Ch. 

Oct. 30, 2019).

114 Compl. Ex. B § 2.2(n) (emphasis omitted).

115 Id. at Schedule I.
33

Entire Agreement; Other Matters. This Agreement, the Partnership 

Agreement, the Merger Agreement, the Ancillary Documents and the 

other writings referred to herein or therein or delivered pursuant hereto 

or thereto constitute the entire agreement, and supersede all other prior 

agreements, understandings, representations and warranties both 

written and oral, among the parties, with respect to the subject matter 

hereof.116

The Contribution and Exchange Agreement’s antireliance and integration 

sections merely limit the scope of representations on which Plaintiff may rely.

117

 

Accordingly, Sections 2.2(n) and 4.7 are not void, and they must be applied to 

Plaintiff’s claims.

2. Sections 2.2(n) And 4.7 Of The Contribution And Exchange 

Agreement Foreclose Plaintiff’s Count I Claim Under RCW 

21.20.010(2).

Plaintiff alleges “Defendants made untrue statements of material fact to [him] 

regarding the retention and involvement of Collage management and employees.”118 

As pled, Count I’s claim for violation of RCW 21.20.010(2) is based on allegedly 

misleading extracontractual statements or omissions in connection with the sale of 

Holdings’s securities, which he received solely pursuant to the Contribution and 

116 Id. § 4.7 (emphasis omitted).

117 See, e.g., Zunum, 2022 WL 2116678, at *14 (citing Stewart, 93 P.3d at 924, and 

Hammond, 2021 WL 961130, at *5–6); Stewart, 93 P.3d at 925 (citing Harsco, 91 F.3d at

343–44).

118 Compl. ¶ 107; id. ¶ 110 (“Defendants made material misrepresentations concerning 

Joe’s, Kevin’s, and Lindsey’s roles in the combined company after the sale, as well as the 

retention of Collage employees, including specific material, false statements alleged above 

and the material omissions of fact necessary to make the statements not misleading.”).
34

Exchange Agreement.

119

 Count I makes no allegations about the intermediate 

receipt of ShootProof Parent Corp. securities under the Merger Agreement. I 

therefore consider the challenged sale of securities to be the sale of Holdings 

securities under the Contribution and Exchange Agreement.120

In the Contribution and Exchange Agreement, Plaintiff expressly represented 

and agreed, inter alia, that: (i) the Contribution and Exchange Agreement, “the 

[Holdings] Partnership Agreement, the Merger Agreement, the Ancillary 

Documents [as defined in the Merger Agreement] and the other writings referred to 

herein or therein or delivered pursuant hereto or thereto constitute the entire 

119 Id. ¶ 107 (“As sellers of securities in the form of Rollover Shares in ShootProof

Holdings, LP, Defendants made untrue statements of material fact to Joe . . . .”); id.. ¶ 48(d) 

(defining “Rollover Shares” as “equity in [Holdings]”); id. at 6 n.2 (“A copy of the 

Contribution and Exchange Agreement, dated March 10, 2021 (the ‘Contribution 

Agreement’), pursuant to which [Plaintiff] received Rollover Shares and exchanged those 

Rollover Shares for Partnership Units (as those terms are defined in the Contribution 

Agreement), is attached as Exhibit B.”). Plaintiff received partnership units in Holdings 

pursuant to the Contribution and Exchange Agreement. Compl. Ex. B at Recitals; see 

supra note 22 (explaining the Contribution and Exchange Agreement defines “Rollover 

Shares” as shares of ShootProof Parent Corp. that Collage’s Class A common stockholders 

received pursuant to the Merger Agreement).

120 Kinney v. Cook, 154 P.3d 206, 211 (Wash. 2007) (“At a minimum, a sale includes a 

mutual agreement to exchange a security.”); Mehta v. Mobile Posse, Inc., 2019 WL 

2025231, at *2 (Del. Ch. May 8, 2019) (“[T]he Court does not rely on those exhibits that 

contradict the complaint’s well-pled facts.”); Parseghian ex rel. Gregory J. Parseghian 

Revocable Tr. v. Frequency Therapeutics, Inc., 2022 WL 2208899, at *9 (Del. Ch. June 

21, 2022) (“A Court must examine what has been alleged in the pleadings, not what a 

plaintiff believes has been alleged.” (quoting Gabelli & Co., Inc. v. Liggett Gp., Inc., 1983 

WL 18015, at *3 (Del. Ch. Mar. 2, 1983), aff’d, 479 A.2d 276 (Del. 1984))).
35

agreement” between the parties;121 and (ii) “the only representations and warranties 

made by or on behalf of the [Holdings] are the representations and warranties 

expressly set forth” therein.

122

Plaintiff does not contest that these antireliance and integration provisions 

generally perform their typical functions. Rather, he contends that integration 

clauses, alone, do not bar fraud suits, citing Washington and Delaware law.123 Under 

Washington law, an integration clause alone may not bar a fraud claim law, but it 

can when read together with an antireliance clause, as in the Contribution and 

Exchange Agreement.124 Moreover, the functioning of these provisions in the 

abstract is a matter of Delaware law: the Contribution and Exchange Agreement is

governed by Delaware law.125 Under Delaware law, contractual antireliance 

language is effective when it identifies the specific information on which a party has 

considered in entering the contract to the exclusion of other information.126 The 

121 Compl. Ex. B § 4.7; Compl. Ex. A § 1.1 (defining “Ancillary Documents”).

122 Compl. Ex. B § 2.2(n).

123 AB at 17 (citing FMC Techs., 2007 WL 1725098, at *5, and Helenius v. Chelius, 120 

P.3d 954, 965–66 (Wash. Ct. App. 2005), and Kronenberg, 872 A.2d at 575).

124 See, e.g., FMC Techs., 2007 WL 1725098, at *4 (citing Helenius, 120 P.3d at 963–66).

125 Compl. Ex. B § 4.8(a).

126 Prairie Cap. III, L.P. v. Double E Hldg. Corp., 132 A.3d 35, 50 (Del. Ch. 2015) (citing 

RAA Mgmt., LLC v. Savage Sports Hldgs., Inc., 45 A.3d 107, 118–19 (Del. 2012)); MidCap 

Funding X Tr. v. Graebel Cos., Inc., 2020 WL 2095899, at *19–20 (Del. Ch. Apr. 30, 2020) 

(holding that because the plaintiffs represented they only relied on the particular 

information delineated by the antireliance and integration provisions, the plaintiff’s 
36

Contribution and Exchange Agreement plainly contains such language in Sections 

2.2(n) and 4.7.

127

Plaintiff does not dispute that the misrepresentations upon which he bases his 

claims are extracontractual.128 The only alleged misstatements about the retention 

or involvement of management or employees occurred outside the four corners of 

the Contribution and Exchange Agreement and the agreements integrated under 

Section 4.7, including the Merger Agreement. For example, Plaintiff alleges 

Defendants made misstatements in the parties’ December 2020 letter of intent.129 

The letter of intent is extracontractual. Plaintiff also alleges “Defendants [made] 

numerous material misrepresentations and omissions in connection with the merger 

negotiations and sale of ShootProof equity securities to [him].”130 Plaintiff cites 

conversations, slide decks, and emails between the parties during pre-closing 

representation “establishes the universe of information on which that party relied” (internal 

quotation marks omitted) (quoting Prairie Cap. III, 132 A.3d at 51)); see also Kronenberg, 

872 A.2d at 593 (“Stated summarily, for a contract to bar a fraud in the inducement claim, 

the contract must contain language that, when read together, can be said to add up to a clear 

anti-reliance clause by which the plaintiff has contractually promised that it did not rely 

upon statements outside the contract’s four corners in deciding to sign the contract. The 

presence of a standard integration clause alone, which does not contain explicit antireliance representations and which is not accompanied by other contractual provisions 

demonstrating with clarity that the plaintiff had agreed that it was not relying on facts 

outside the contract, will not suffice to bar fraud claims.”).

127 Compl. Ex. B §§ 2.2(n), 4.7.

128 See AB at 6–10, 20.

129 Compl. ¶¶ 40–41.

130 Id. at 17 (capitalization altered); id. ¶¶ 39, 49–66.
37

negotiations.131 One email documents the removal of restrictive operating covenants

around employee compensation from the Merger Agreement.132 Plaintiff also cites 

Defendants’ approval of a post-closing email he sent as evidence of a misleading 

“assurance.”133 These, too, are extracontractual.

The plain and unambiguous language of the antireliance and integration 

provisions in Contribution and Exchange Agreement Sections 2.2(n) and 4.7, 

respectively, foreclose Plaintiff’s allegations that Defendants violated RCW 

21.20.010(2) by making misleading extracontractual statements or omissions.134 

Defendants’ Motion is granted as to Count I.

131 E.g., id. ¶ 39 (alleging Defendants made false assurances in late 2020 conversations); 

id. ¶ 52 (alleging Marshall made misstatements to Joe in a January 29, 2021 conversation); 

id. ¶ 53 (alleging Marshall made misrepresentations to Plaintiff in February 2021 emails); 

id. ¶ 54 (alleging Marshall made misrepresentations to Plaintiff in a February 11, 2021 

slide deck); id. ¶¶ 55–59 (alleging Marshall made misrepresentations to Lindsey in March 

2021 emails); id. ¶ 60 (alleging a PSG principal made a “materially false” statement to 

Collage’s lead banker that the banker forwarded to Plaintiff).

132 Id. ¶ 60.

133 Id. ¶ 66.

134 Abry P’rs V, L.P. v. F & W Acq. LLC, 891 A.2d 1032, 1057 (Del. Ch. 2006) (“[A] party 

cannot promise, in a clear integration clause of a negotiated agreement, that it will not rely 

on promises and representations outside of the agreement and then shirk its own bargain in 

favor of a ‘but we did rely on those other representations’ fraudulent inducement claim.” 

(collecting cases)); Progressive Int’l Corp. v. E.I. Du Pont de Nemours & Co., 2002 WL 

1558382, at *7 (Del. Ch. July 9, 2002) (“Delaware courts have held that sophisticated 

parties may not reasonably rely upon representations that are inconsistent with a negotiated 

contract, when that contract contains a provision explicitly disclaiming reliance upon such 

outside representations.” (collecting cases)); Sunline Com. Carriers, Inc. v. CITGO 

Petroleum Corp., 206 A.3d 836, 846 (Del. 2019) (“When the contract is clear and 

unambiguous, we will give effect to the plain-meaning of the contract’s terms and 
38

3. Plaintiff’s Count II Claim Under RCW 21.20.430 Fails 

Without An Underlying Violation Of The Securities Act Of 

Washington.

Count II alleges PSG, Holdings GP, and the Individual Defendants are liable 

under RCW 21.230.430 for the securities law violations alleged in Count I.135 RCW 

21.20.430 provides, in pertinent part: 

(2) Any person who buys a security in violation of the provisions of 

RCW 21.20.010 is liable to the person selling the security to him or her, 

who may sue either at law or in equity to recover the security, together 

with any income received on the security, upon tender of the 

consideration received, costs, and reasonable attorneys’ fees, or if the 

security cannot be recovered, for damages. . . .

(3) Every person who directly or indirectly controls a seller or buyer 

liable under subsection (1) or (2) above, every partner, officer, director 

or person who occupies a similar status or performs a similar function 

of such seller or buyer, every employee of such a seller or buyer who 

materially aids in the transaction, and every broker-dealer, salesperson, 

or person exempt under the provisions of RCW 21.20.040 who 

materially aids in the transaction is also liable jointly and severally with 

and to the same extent as the seller or buyer, unless such person sustains 

the burden of proof that he or she did not know, and in the exercise of 

reasonable care could not have known, of the existence of the facts by 

reason of which the liability is alleged to exist. There is contribution as 

in cases of contract among the several persons so liable.

provisions, without resort to extrinsic evidence.” (internal quotation marks omitted) 

(quoting Osborn ex rel. Osborn v. Kemp, 991 A.2d 1153, 1159–60 (Del. 2010))).

135 Compl. ¶¶ 114–121; id. ¶ 116 (“PSG, [Holdings] GP, and the Individual Defendants 

(the ‘Control Defendants’), as executive officers, owners, and/or ‘persons’ who directly or 

indirectly control [Holdings], are liable jointly and severally with and to the same extent 

as [Holdings] under RCW 21.20.430.”); id. ¶ 120 (“PSG and ShootProof committed 

violations of RCW 21.20.010.”); id. ¶ 119 (“PSG, [Holdings] GP, Marshall, and 

McDermott are controlling persons of ShootProof within the meaning of RCW 

21.20.430.”).
39

Having concluded Plaintiff has failed to state the requisite claim for violation of 

RCW 21.20.010(2), he cannot establish liability under RCW 21.20.430.136 

Defendants’ Motion is granted as to Count II.

III. CONCLUSION

Defendants’ Motion to Dismiss is GRANTED. Counts I and II are dismissed 

with prejudice.

136 E.g., Hunichen v. Atonomi LLC, 2022 WL 971567, at *7 (W.D. Wash. Mar. 31, 2022)

(dismissing a counterclaim under RCW 21.20.430(2) where the counterclaimant failed to 

“set forth a plausible claim for fraud or other conduct that would violate RCW 21.20.010”).