Opinion ID: 1532151
Heading Depth: 1
Heading Rank: 3

Heading: The Claims Advanced on This Appeal And This Court's Resolution of Those Claims

Text: The claims advanced on this appeal (and cross appeal) center around three broad challenges. First, the appellants challenge the money judgment entered against Black and Inc., based upon adjudicated breaches of fiduciary duty and contract. Second, the appellants attack the Court of Chancery's determination that the By-Law Amendments were invalid on equitable grounds. Third, the appellants challenge the Court's determination that the Rights Plan was statutorily and equitably valid in these specific circumstances. Black and Inc. first challenge the money judgments against them, all based upon the Court of Chancery's summary judgment rulings, on several grounds. Inc. claims that: (i) it was not a party to or bound by the Restructuring Proposal Agreement; (ii) it had no fiduciary or contractual duty to support the Strategic Process; and (iii) and even if Inc. had such a duty, there is no evidence to support a conclusion that Inc. breached any contractual or fiduciary obligation. Black claims that the Court of Chancery erred in holding that he had breached the Restructuring Proposal Agreement and his fiduciary duty of loyalty owed to International, because: (i) International did not have a legally protected interest in the sale of The Telegraph; (ii) Black did not violate any disclosure duty or duty of confidentiality owed to International, nor did he violate any fiduciary obligation by pursuing the Barclays transaction on behalf of Inc.; (iii) the Court of Chancery improperly estopped Black from relitigating his defenses to the breach of contract claims, and also erroneously excluded probative evidence that was favorable to Black; and (iv) Black cannot be held liable for monetary damages because the Company did not request such relief and, in any event, Black cannot be held liable for Inc.'s money obligation. International, together with appellees James R. Thompson, Richard N. Perle, and Shmuel Meitan, vigorously contests these arguments. They urge that the money judgments against Inc. and Black are correct in all respects, legally, factually and procedurally, and should be affirmed. [11] Second, Inc. and Black challenge the Court of Chancery's determination that the By-Law Amendments were invalid in equity. They argue that contrary to the Court's findings, those Amendments were not adopted for an inequitable purpose, nor did they have an inequitable effect. In response, the appellees contend that the Court of Chancery's invalidation of the By-Law Amendments on equitable grounds was legally and factually correct. They further argue (in their cross appeal) that should this Court rule that the Court of Chancery erred by invalidating the By-Law Amendments on equitable grounds, those Amendments must be invalidated (contrary to the Court's determination) on the alternative basis that the By-Law Amendments violate the Delaware General Corporation Law. Third, Black and Inc. claim that the Court of Chancery erred in upholding the Rights Plan. They claim that the Rights Plan is statutorily invalid under 8 Del. C. §§ 157 and 203; and in any event, is equitably invalid under Unocal [12] and Blasius. [13] The appellees argue, in response, that the Court of Chancery correctly held that the Rights Plan was not statutorily invalid; that the Rights Plan satisfied the threat and proportionality standards of Unocal; that the Blasius standard of review did not apply; and that even if Blasius did apply, a sufficiently compelling justification existed for any incidental burden on Inc.'s voting rights. We have considered carefully, and in depth, the multitudinous arguments advanced by the parties in their extensive briefs on their appeal and cross-appeal. We conclude that the Court of Chancery did not err in any respect in its findings of fact or its conclusions of law. To the extent the Court of Chancery made findings of fact, those findings are amply supported by the evidentiary record and are the result of a logical and orderly deductive process. [14] To the extent the Court of Chancery made determinations of law that were based upon those findings, and that were essential to resolving the claims and counterclaims of the parties, we find those conclusions to be free from legal error. The rationale for the rulings of the Court of Chancery are set forth in its extensive Opinion of February 26, 2004 [15] and its bench ruling, and no useful purpose is served by further discussing those rulings in a separate opinion. We therefore uphold the judgment(s) on the basis of the Court of Chancery's well-reasoned Opinion and bench ruling. Our affirmance of those judgments, however, should not be viewed as approval or disapproval of statements that are dictum, i.e., rulings that were not essential to a resolution of the claims before the Court of Chancery and to the award of the judgment(s) affirmed by this Court. [16]