Court Opinion

ID: 4200865
Source: CourtListenerOpinion
Date Created: 2017-09-01 17:07:37.973551+00
Date Added: 2024-06-11T09:23:13.779779
License: Public Domain

IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE

 EAGLE FORCE HOLDINGS, LLC, a          )
 Delaware limited liability company,   )
 and EF INVESTMENTS, LLC, a            )
 Delaware limited liability company,   )
                                       )
                     Plaintiffs,       ) C.A. No. 10803-VCMR
                                       )
      v.                               )
                                       )
 STANLEY V. CAMPBELL,                  )
                                       )
                     Defendant.        )

                       MEMORANDUM OPINION

                     Date Submitted: August 28, 2017
                     Date Decided: September 1, 2017

Frank E. Noyes, II, OFFIT KURMAN, P.A., Wilmington, Delaware; Harold M.
Walter, OFFIT KURMAN, P.A., Baltimore, Maryland; Attorneys for Plaintiffs.

David L. Finger, FINGER & SLANINA, LLC, Wilmington, Delaware; Attorney for
Defendant.

MONTGOMERY-REEVES, Vice Chancellor.
      In 2013, Richard Kay and Stanley Campbell decided to form a business

venture to market certain medical diagnosis and prescription technology that

Campbell had developed. The parties outlined the principal terms of the investment

through two letter agreements in November 2013 and April 2014. Under the

principal terms, Kay and Campbell would form a new limited liability company of

which they would each be 50% members. Campbell would contribute the stock of

EagleForce Associates, Inc., a Virginia corporation, (“EagleForce Associates”) and

the membership interests of EagleForce Health, LLC, a Virginia limited liability

company, (“EagleForce Health”) along with certain other intellectual property. Kay

would contribute cash. For many months, the parties negotiated several key terms

of the transaction documents for the new venture. In the meantime, Kay contributed

cash to EagleForce Associates without a formal agreement in place in order to keep

the company afloat.

      On August 28, 2014, Kay and Campbell signed the transaction documents,

which included an operating agreement for Eagle Force Holdings, LLC, a Delaware

limited liability company, (“Eagle Force Holdings”) and a contribution agreement.

The parties dispute what occurred at the August 28 meeting. Plaintiffs assert that

the parties formed binding contracts at the August 28 meeting. Campbell contends

that his signature was meant to indicate receipt of the latest drafts of the agreements

but not to manifest his assent to their terms.       Campbell also argues that the

                                          1
transaction documents lack certain essential terms on which the parties had not yet

come to agreement, including representations regarding Campbell’s ownership of

the intellectual property, stock of EagleForce Associates, and membership interests

of EagleForce Health.

      After a fact-intensive inquiry, this Court holds in this post-trial opinion that

the transaction documents do not represent an enforceable contract because the

parties failed to come to agreement on certain terms that the parties regarded as

essential. The only basis for this Court’s personal jurisdiction over the defendant is

consent through forum selection clauses in the contribution agreement and the

limited liability company agreement. Because Campbell is not bound by the forum

selection clauses, this case is dismissed for lack of personal jurisdiction.

I.    BACKGROUND

      The facts in this opinion are my findings based on the parties’ stipulations,

152 trial exhibits, including deposition transcripts, and the testimony of ten

witnesses presented at a five-day trial before this Court that began on February 6,

2017. Additionally, the Court considers Campbell’s testimony and the documentary

evidence presented at the evidentiary hearings that this Court held on August 31,

                                           2
2016, September 8, 2016, May 5, 2017, and August 28, 2017. I grant the evidence

the weight and credibility that I find it deserves.1

      A.     Parties and Relevant Non-Parties

      Richard Kay is a businessman and investor in the Washington, DC

metropolitan area. Since 2005, Kay has owned a government contracting company

called Sentrillion with other partners.2 Kay also controls Plaintiff EF Investments,

LLC, a Delaware limited liability company (“EF Investments”).

      Defendant Stanley Campbell controls EagleForce Associates and EagleForce

Health. EagleForce Associates is a start-up company that Campbell intended to use

to market a pharmaceutical software system called PADRE.3 PADRE aggregates

medical information about patients to assist in determining which medications to

prescribe to those patients. It also monitors pharmaceutical sales for compliance

with federal law.4

1
      Citations to testimony presented at trial are in the form “Tr. # (X)” with “X”
      representing the name of the speaker. After being identified initially, individuals
      are referenced herein by their surnames without regard to formal titles such as “Dr.”
      No disrespect is intended. Exhibits are cited as “JX #.” Unless otherwise indicated,
      citations to the parties’ briefs are to post-trial briefs, and citations to the oral
      argument transcript refer to the post-trial oral argument.
2
      Tr. 18 (Offit).
3
      Id. at 775 (Campbell).
4
      Id. at 766.

                                            3
      Plaintiff Eagle Force Holdings is a Delaware limited liability company created

by Kay to serve as the holding company for the operating EagleForce businesses.

The Amended and Restated Limited Liability Company Agreement of Eagle Force

Holdings (the “LLC Agreement”) contemplates that Campbell and EF Investments

will each own 50% of the membership interests in Eagle Force Holdings.5 The

Contribution and Assignment Agreement that Kay and Campbell began to negotiate

(the “Contribution Agreement,” together with the LLC Agreement, the “Transaction

Documents”) contemplates that EagleForce Associates and EagleForce Health will

be subsidiaries of Eagle Force Holdings.6

      Donald Rogers is an attorney who represented Campbell through key parts of

his negotiations with Kay.7

      Theodore Offit is an attorney who represented Kay in the negotiations with

Campbell.8

5
      See JX 79.
6
      JX 78.
7
      Tr. 817-18 (Rogers).
8
      See id. at 19 (Offit).

                                         4
      Said S. Salah is the Vice President of Finance and CFO of EagleForce

Associates.9 From January 2016 until July 2017, he lived overseas and tapered off

his services to EagleForce Associates.10

      General John W. Morgan III is a Senior Vice President of EagleForce

Associates and EagleForce Health.11

      Christopher Cresswell is the General Manager of EagleForce Health.12

      Jashuva Variganti is an employee of EagleForce Associates.13

      Katrina Powers is an employee of Sentrilion.14

      B.     Facts

      Campbell first met Kay through a mutual friend in 2005 or 2006 when

Campbell was seeking an investor for an earlier iteration of EagleForce Associates.15

Kay did not invest in the earlier EagleForce venture, but in 2009, Campbell

9
      Id. at 1086 (Salah).
10
      Id.; Aug. 28, 2017 Hr’g Tr. 27.
11
      Tr. 1166 (Morgan).
12
      May 5, 2017 Hr’g Ex. 6.
13
      Tr. 716 (Variganti).
14
      Id. at 246-47 (Powers).
15
      Id. at 768 (Campbell).

                                           5
approached Kay again about investing in a bomb detection technology. 16 Those

negotiations also did not lead to a deal.

      In January 2013, Campbell needed capital to market his PADRE technology

through EagleForce Associates. Before approaching Kay again, Campbell met Said

Salah who had experience with government contracting.17 Campbell hired him to

work with EagleForce Associates, and in May 2013, Salah and Campbell negotiated

an employment agreement for Salah. Under Salah’s employment agreement, he is

“eligible to earn equity participation by demonstrating a sustained ability to attain

specific sales, operations, and management goals.”18 The only goal mentioned in

the employment agreement is to “generate prorated new business sales of at least

$6.0 million over the next two years.”19 The agreement states that Salah is eligible

to earn 2.5% of the equity of EagleForce Associates.20 Salah also loaned money to

EagleForce Associates and deferred collection of his salary to provide EagleForce

Associates with cash needed for its operations.21 In the same month, Salah’s brother,

16
      Id. at 770-71.
17
      Id. at 1094 (Salah).
18
      May 5, 2017 Hr’g Ex. 6.
19
      Id.
20
      Tr. 1093-94 (Salah); May 5, 2017 Hr’g Ex. 6.
21
      Tr. 1091, 1094-95 (Salah).

                                            6
Haney Salah, signed an employment agreement to become the Chief Medical Officer

of EagleForce Associates. His employment agreement contains the same eligibility

requirements for equity participation, but Haney is entitled to 1.5% of the

EagleForce Associates equity upon satisfying those requirements.22

      Campbell signed Salah’s employment agreement, and Salah testified that Kay

also saw the agreement and was aware of his claim to equity in EagleForce

Associates.23

              1.    The November 2013 letter agreement

      In or around November 2013, Campbell approached Kay about investing in

EagleForce Associates for the purpose of marketing the PADRE software.24

EagleForce Associates recently had been denied a government contract, and

Campbell believed that with adequate capitalization, EagleForce Associates would

be more attractive as a government contractor.25

      Kay was interested in investing in EagleForce Associates, and on November

27, 2013, Campbell and Kay signed a letter agreement dated November 15, 2013.26

22
      May 5, 2017 Hr’g Ex. 6; Tr. 1097 (Salah).
23
      Tr. 1094 (Salah).
24
      Id. at 774-75 (Campbell).
25
      Id. at 774.
26
      JX 1.

                                          7
Kay’s lawyers at the law firm Offit Kurman drafted an initial version of the

November letter agreement, but Campbell and Kay independently made changes to

it themselves before signing.27 The November letter agreement contemplates that

Campbell and Kay “will form a new LLC entity and/or a series of industry specific

LLC’s [sic] verticals in Virginia.”28 Campbell’s contribution “will be PADRE

source code and patents,”29 and Kay’s contribution will be at least $1.8 million in

cash with the goal of raising $7.8 million in total financing to be contributed by

either Kay or a mutually agreed upon investor.30 The November letter agreement

states that “[t]he company will be able to state that it has both the technology and

intellectual property rights for all software and applications.”31 It further provides

that both Campbell and Kay will own 50% of the new LLC and that they will “never

dilute [their combined stake to] less than 50.1% together in order to maintain control.

They will also agree that their vote will always be uniformly tied as a single vote

27
      Tr. 131 (Offit).
28
      JX 1, ¶ 2.
29
      Id. ¶ 7.
30
      Id. ¶ 6.
31
      Id. ¶ 7.

                                          8
thus protecting [Campbell] from complete loss of control.”32 Further, Campbell will

be entitled to a priority return of $1.8 million before Kay receives a distribution.33

      Under the November letter agreement, both Campbell and Kay would be

involved in managing the new LLC and “will confer on all business and marketing

related activities as well as all capital needs.”34 The new LLC’s board will have two

Campbell designees, two Kay designees, and a fifth member upon which Kay and

Campbell will agree.35 All of the material terms of the November letter agreement

were subject to due diligence.36

              2.     The April 2014 letter agreement

      After executing the November 2013 agreement, Kay and Campbell continued

to negotiate. On March 17, 2014, Kay filed a certificate of formation for Eagle Force

Holdings in Delaware.37 At that time, Kay did not tell Campbell he had formed the

Eagle Force Holdings entity; nor did he inform Campbell that the entity was

established in Delaware rather than Virginia, as the November letter agreement

32
      Id. ¶ 5.
33
      Id. ¶ 10.
34
      Id. ¶ 4.
35
      Id. ¶ 11.
36
      Id. ¶¶ 6, 8, 10.
37
      JX 7.

                                           9
stated.38 But on April 4, 2014, Kay and Campbell signed an amendment to the

November letter agreement, which stated “[b]y April 21 it is anticipated that a new

LLC will be formed to serve as a parent entity (‘Holdco’) for Eagle Force Associates,

Inc. and the recently formed Eagle Force Health Solutions, LLC . . . .”39

      Kay and Campbell signed the April 4, 2014 letter agreement without counsel

present.40 The April letter agreement “amends the letter agreement that [Campbell

and Kay] executed on November 27, 2013 that was dated as of November 15,

2013.”41 The April letter agreement maintained that Campbell and Kay would share

management responsibilities and confer regarding marketing and capital needs.42

But it also further defined Campbell’s and Kay’s roles in the anticipated parent

company, referred to as “Holdco.” The April letter agreement stated that

               [Campbell] will have primary responsibility over all
               information technology, product development, R&D, and
               customer service and maintenance, in each case subject to
               an annual budget approved by the Holdco board. [Kay]
               will have primary responsibility over financial matters,
               personnel/HR, and management of outside accounting,
               legal, tax and other advisors and consultants as well as all
               other matters relating to the operation of the business of

38
      Tr. 991-92 (Campbell).
39
      JX 12, ¶ 2.
40
      Tr. 380-81 (Kay).
41
      JX 12.
42
      Id. ¶ 4.

                                           10
             Holdco and its subsidiaries and will consult with
             [Campbell] on all decisions affecting these functions.43

      The April letter agreement contemplated that Campbell would remain entitled

to a priority return of his capital,44 50% ownership of “Holdco,” and Kay’s

agreement that Kay and Campbell together would not be diluted below 51% of

“Holdco,” a slightly higher threshold than the 50.1% in the November letter

agreement.45 The parties referred to the more defined spheres of management

responsibility in the anticipated 50-50 partnership as “swim lanes.”46

      Both the November 2013 and the April 2014 letter agreements contemplated

that Campbell and Kay would sign an operating agreement for the new LLC

“Holdco.”47 The April letter agreement provides that “[Campbell] will, at execution

of the Holdco LLC operating agreement, make customary representations to [Kay]

regarding Holdco’s free and clear right, title and interest to 100% of such Stanley

referenced IP . . . .”48 “Stanley IP” is defined in the letter agreement as “all software

and source code . . . invented, developed or created, directly or indirectly, by

43
      Id. ¶ 3.
44
      Id. ¶ 10.
45
      Id. ¶ 5.
46
      Tr. 319 (Kay).
47
      JX 1, ¶ 8; JX 12, ¶ 8.
48
      JX 12, ¶ 7.

                                           11
[Campbell], in whole or in part, alone or in conjunction with others (including

specifically Eagle Force Associates, Inc. . . . .”49

      Recognizing that Kay and Campbell had not yet agreed to a “Holdco”

operating agreement, the April letter agreement provides that Kay will advance

$500,000 to Eagle Force Holdings upon the execution of the letter agreement. And

“[t]his $500,000 will be evidenced by a demand promissory note issued to [Kay] by

Eagle Force Associates, Inc. and Eagle Force Health Solutions, LLC, jointly and

severally . . . .”50 The evidence does not show that Kay received such a note until

July 7, 2014, as discussed below. The April letter agreement also contemplates that

once Kay and Campbell agree to the “Holdco” LLC agreement, Kay will contribute

an additional $1,800,000 to equal the value of Campbell’s intellectual property,

$2,300,000.51 Also at that time, Campbell will receive a $500,000 distribution from

“Holdco” for his personal use.52

49
      Id.
50
      Id. ¶ 6.
51
      Id.
52
      Id.

                                           12
             3.     The EagleForce businesses hire Cresswell and Morgan
      In May 2014, EagleForce Health entered an employment agreement with

Christopher Cresswell under which Cresswell became General Manager of

EagleForce Health.53 Cresswell’s employment agreement provides that he is

             eligible for equity participation in EagleForce [Health]
             Stock Appreciation Rights (SAR’s) plan. [Cresswell] will
             be eligible to earn equity participation as granted by the
             Board of Directors in the amount of 5% non-voting
             interest in the company of which 2.5% will be authorized
             and not issued on execution of this agreement and the
             remaining 2.5% shall vest equally based on tenure on a
             prorated basis over the next 3 years. Any outstanding
             unauthorized SARs shall automatically vest for any
             change in control or termination without cause.54

Cresswell testified that he understood that his agreement provided him with a right

to 5% of the equity of EagleForce Health but that the equity would be expressed as

SARs for tax purposes.55 Cresswell had not seen a SARs plan but testified that Kay

told him that his equity would take the form of SARs.56

      In the same month, EagleForce Associates and EagleForce Health hired

General John W. Morgan III as a Senior Vice President. Morgan’s employment

agreement provides that he is

53
      May 5, 2017 Hr’g Ex. 6.
54
      Id.
55
      Tr. 652 (Cresswell).
56
      Id. at 653.

                                        13
            eligible for equity participation in EagleForce Associates,
            Inc. Stock Appreciation Rights (SAR’s) plan. [Morgan]
            will be eligible to earn equity participation as granted by
            the Board of Directors in the amount of 300,000 SAR’s
            (150,000 each) valued [sic] one dollar ($1) per SAR. . . .
            SAR’s will vest based on both tenure and
            contribution/revenue achievements.          Any sale of
            EagleForce prior to the 3 year vesting shall result in 100%
            of [Morgan’s] shares automatically vesting provided [that
            Morgan is] still employed by EagleForce or Terminated
            without “Cause.”57

As such, Cresswell and Morgan were both entitled to immediate vesting of any SARs

they had been granted upon a sale or change of control of the EagleForce businesses.

            4.     Kay becomes involved in the EagleForce Associates business

      As Kay was conducting due diligence on the EagleForce Associates business,

he continued to provide funding to EagleForce Associates58 and became involved in

certain aspects of the day-to-day operations of the company. For example, Kay

suggested that Melinda Walker be hired as a secretary at EagleForce Associates.59

She was paid $75,000 per year, which concerned Campbell because it was a higher

salary than most EagleForce Associates employees earned at the time.60

Additionally, in October 2014, Katrina Powers, a Sentrillion employee, and Jashuva

57
      May 5, 2017 Hr’g Ex. 6.
58
      JX 106.
59
      Tr. 436 (Kay).
60
      Id. at 917-19 (Campbell).

                                        14
Variganti, an EagleForce Associates employee, established a new account at

Paychex, a payroll service, for the EagleForce Associates payroll to which Campbell

did not have access.61

      As Kay became more involved in EagleForce Associates, Kay and Campbell’s

relationship began to sour. In an April 30, 2014 email exchange, Kay advised

Campbell that Bryan Ackerman, Sentrillion’s General Counsel, would be involved

in all contracts into which EagleForce Associates entered. Campbell, in contrast,

wanted Salah to have a greater role. He wrote to Kay, “I am no longer enjoying

coming to work. I do not think this will work. Please tell me what I owe you and

how we can move forward independently.”62 Kay responded referring to the

November and April letter agreements and stating, “[m]y position is we are signed

partners . . . .”63 Additionally, Kay began to speak with EagleForce Associates

employees about embarrassing aspects of Campbell’s past. For example, at some

point between March and August of 2014, Kay met with Cresswell at a country club

in Potomac, Maryland and told Cresswell that Campbell had previously committed

61
      Id. at 739-40 (Variganti); id. at 949-50 (Campbell).
62
      JX 130.
63
      Id.

                                           15
fraud.64 And Kay did not get along personally with certain EagleForce employees,

particularly Salah.65

             5.       Campbell and Kay begin to negotiate the LLC Agreement
                      and the Contribution Agreement
      Despite the fact that Kay and Campbell’s relationship had become strained,

they began to negotiate the LLC Agreement for Eagle Force Holdings—which

mirrored the structure of the “Holdco” entity referenced in the April 2014 letter

agreement—and the Contribution Agreement. In addition to Offit Kurman, Kay

engaged Latham & Watkins to advise him on investing in the EagleForce business.

Michael Schlesinger of Latham & Watkins advised Campbell that he should retain

his own counsel,66 and in or around April 2014, Campbell retained Donald Rogers

with the Schulman Rogers law firm.67

      On May 13, 2014, Latham & Watkins presented a draft Contribution

Agreement and a draft LLC Agreement for Eagle Force Holdings to Campbell.68

The LLC Agreement referred to the March 17, 2014 certificate of formation for

64
      Tr. 656-59 (Cresswell).
65
      Id. at 1087-88 (Salah); id. at 1174 (Morgan).
66
      Tr. 795 (Campbell).
67
      Id. at 817 (Rogers).
68
      JX 14; JX 15.

                                          16
Eagle Force Holdings that was filed in Delaware.69 Campbell, thus, was aware that

Kay formed Eagle Force Holdings in Delaware at least by May 13, 2014. The

agreement included a forum selection clause consenting to personal jurisdiction in

the Delaware courts and an arbitration clause.70 The Latham & Watkins May 13,

2014 draft also included a first priority return of capital for any contributions made

after the date of the LLC Agreement.71

      On June 30, 2014, Rogers sent revised drafts of the LLC Agreement and the

Contribution Agreement to Offit.72 The drafts included several notes indicating that

certain points needed to be discussed such as the distribution waterfall and the

structure of Campbell’s contribution of intellectual property. 73 It also added a

protection against dilution for Campbell arising from any additional capital

contributions until such contributions exceed $5.5 million.74 And the June 30 draft

69
      JX 15 Recitals.
70
      Id. art. XII.
71
      Id. § 5.1.
72
      JX 17.
73
      JX 18, § 3.2.1; JX 19, § 5.1.2.
74
      JX 18, § 3.2.

                                         17
added the requirement that for the Eagle Force Holdings board to act, Campbell and

Kay both must vote in favor of the board action.75

      Also on June 30, 2014, Campbell received an email from Kay that Campbell

believed contained a racial slur.76 Kay maintains that the word was a typographical

error.77 I need not find what the email was intended to say because I consider it only

for the fact that Campbell had reservations about Kay’s character, and from

Campbell’s perspective, his personal relationship with Kay continued to deteriorate.

Whether such reservations were justified has no bearing on this case. Despite

Campbell’s reservations, he continued his business relationship with Kay;

EagleForce Associates continued to receive funding from Kay; and the parties

continued to negotiate the Transaction Documents.

               6.    The July 7, 2014 meeting

      On July 3, 2014, Offit sent Rogers an email confirming a meeting on July 7,

2014 at Rogers’s office to negotiate the Transaction Documents. Offit expressed his

and Kay’s concern that the negotiations were proceeding slowly, and Rogers

75
      Id. § 4.1.3.
76
      JX 16.
77
      Tr. 444 (Kay).

                                         18
responded that “[f]or the benefit of everyone, let’s make Monday [July 7] the day

we agree on all terms.”78

      On July 7, 2014, Kay, Campbell, and their counsel met at Rogers’s office to

negotiate the unsettled terms of the Contribution Agreement and the LLC

Agreement.79 Offit believed that at the beginning of the meeting, three primary

issues remained to be negotiated. First, the parties had not come to agreement on

the scope of the intellectual property that Campbell would contribute and the extent

of the representation Campbell would make regarding his ownership of the

intellectual property and any third-party infringement.80 Second, because Campbell

believed that the EagleForce business required $7.8 million in cash to be successful,

and Kay planned to contribute only $2.3 million, the parties had to negotiate how

Kay and Campbell’s interests would be diluted by an additional $5.5 million

investment.81 Third, the structure of the Eagle Force Holdings board of directors

needed to be decided. The parties had not yet agreed whether Kay and Campbell

78
      JX 24.
79
      Tr. 476 (Kay).
80
      Id. at 62 (Offit).
81
      Id. at 63; see JX 18, § 3.2 (Schulman Rogers June 30, 2014 draft LLC Agreement).

                                         19
would be the only directors or whether a third director would be elected to break

deadlock between the parties.82

      The July 7 meeting went late into the night, and the parties resolved the three

issues that Offit understood to be outstanding. As to the scope of the intellectual

property Campbell would contribute, the parties agreed that he would contribute all

of the intellectual property he had created that was related to the EagleForce

business.83 They agreed that Campbell and Kay would not be diluted at the Eagle

Force Holdings level but that they would attempt to raise the additional $5.5 million

in capital by selling up to 20% of the equity of each subsidiary of Eagle Force

Holdings.84 And they agreed that Campbell and Kay would be the sole directors of

Eagle Force Holdings, but the subsidiaries would have a three-person board with an

additional independent director.85 While those issues were resolved at the July 7

meeting,86 a substantial new issue arose. During that meeting, Offit discovered for

the first time that Campbell had previously filed for bankruptcy, which made Offit

82
      Tr. 63 (Offit).
83
      Id. at 64-66; see JX 42, Sched. 2.2(b) (Schulman Rogers July 14, 2014 draft
      Contribution Agreement).
84
      Tr. 64-66 (Offit).
85
      Id. at 64-66; see JX 30, § 4.1.8 (Schulman Rogers July 9, 2014 draft LLC
      Agreement).
86
      Tr. 63-64 (Offit).

                                         20
concerned about Campbell’s title to the property he was planning to contribute to

Eagle Force Holdings.87 The next day, Offit discovered through consultation with a

bankruptcy attorney at his firm that debt had been discharged in Campbell’s

bankruptcy and that Campbell had not listed the PADRE intellectual property as an

asset on the schedules to his bankruptcy petition.88 Kay’s counsel wanted Campbell

to reopen his bankruptcy and amend the petition to include the intellectual property

that had previously been omitted.89 At trial, Campbell testified that he did not want

to reopen his bankruptcy after he learned that having two bankruptcy proceedings

on his record might make future investors uncomfortable with his participation in

EagleForce management.90

      At the end of the July 7 meeting, Kay and Campbell signed signature pages,

which their attorneys kept in escrow and planned to exchange when Kay and

Campbell came to agreement.91 The purpose of the signature pages was to avoid the

need to reconvene to sign the Contribution Agreement and the LLC Agreement.92

87
      Id. at 70.
88
      Id. at 73; JX 32.
89
      Tr. 79 (Offit).
90
      Id. at 995-96 (Campbell).
91
      Id. at 68 (Offit); JX 115.
92
      Tr. 68 (Offit).

                                         21
At the July 7 meeting, no one discussed whether the attorneys’ exchange of the

signature pages constituted the only means by which they could come to agreement

on this deal.93 Kay testified that he did not believe that an exchange of the signature

pages was the only way the parties could form a binding agreement.94

      Also on July 7, Campbell signed an EagleForce Associates note payable to

Kay for the $700,000 that Kay had contributed to EagleForce Associates because

Kay and Campbell had not yet agreed to an operating agreement for Eagle Force

Holdings.95 Kay and Campbell agreed that the note would be canceled if they were

able to reach agreement on the Transaction Documents.96

               7.     Kay and Campbell continue to negotiate

      On July 8, 2014, Offit sent Rogers a list of changes to the Contribution

Agreement based on the July 7 discussion.97 And an associate at Rogers’s firm sent

a redlined draft of the LLC Agreement to Offit and Kay on July 9, 2014

incorporating the negotiated terms from the July 7 meeting.98

93
      Id. at 69; id. at 827 (Rogers).
94
      Tr. 482-83 (Kay).
95
      JX 34; JX 35.
96
      JX 25.
97
      JX 28.
98
      JX 29.

                                          22
      On July 9, 2014, Campbell also sent an email to Morgan announcing that

EagleForce Associates and EagleForce Health had taken on Kay as their “first

Partner.”99 Morgan responded congratulating both Kay and Campbell and copying

several EagleForce employees.100 The same day, Campbell held a meeting at

EagleForce Associates’s offices with all of the office staff to introduce them to

Kay.101

      Throughout July 2014, Kay and Campbell continued to negotiate, and on July

22, 2014, Kay sent an email to Campbell stating, “I am hearing that you may be

trying to change the deal and we now may not be consistent understanding based on

our agreemnt [sic].”102 Presumably, Kay was referring to the November and April

letter agreements. Kay and Campbell then met without their lawyers and discussed

open issues. On July 25, 2014, Campbell sent an email to Rogers, Offit, and Kay

informing the lawyers of what Campbell and Kay had discussed. In part, Campbell

wrote, “[a]s for the Issue related to Bankruptcy—I don’t think I have much of an

99
      JX 33. Campbell testified that he did not send this email but that Melinda Walker
      sent it from his email account without his permission. Tr. 941-42 (Campbell).
      Regardless, this email does not alter the weight of the evidence.
100
      JX 33.
101
      Tr. 1188-89 (Morgan).
102
      JX 43.

                                         23
issue . . . what we discussed and agreed is that we will pay any amount owed. I will

change that to the point that we will pay any amount under $10,000.”103

      But the bankruptcy issue was not actually resolved. On August 5, 2014,104

Campbell, Kay, Rogers, and Offit met to attempt to agree on outstanding issues.

Campbell testified that Kay and Offit would not drop the bankruptcy issue105 because

they were concerned about Campbell’s title to his intellectual property. To indicate

that Campbell was not willing to reopen his bankruptcy, he walked out of the

meeting. He testified, “I made it clear I wasn’t doing that. And the only way I could

make it any clearer was to leave.”106 When asked about the circumstances of that

meeting, Rogers testified “[i]t may not have been clear to me, but . . . I believe we

were discussing . . . the issue of the board of directors, the SARs, and the

bankruptcy.”107

      On or around August 6, 2014, Kay and Campbell both signed a handwritten

sheet of paper that stated, “Campbell has rights to approve new investment.”108 Offit

103
      JX 46.
104
      Tr. 80 (Offit).
105
      Id. at 808 (Campbell).
106
      Id.
107
      Id. at 820-21 (Rogers).
108
      JX 54.

                                         24
sent an email to Rogers to clarify what Kay meant in agreeing to the handwritten

note. He wrote, “[Campbell] told [Kay] he needed to be involved in all capital raise

decisions. [Kay] is obviously in agreement on [Campbell’s] need to be involved in

capital raise matters, but [Campbell] cannot have a blocking right or veto right. The

3 person board needs to approve capital raise matters.”109

      On or before August 14, 2014, Kay and Campbell met and discussed thirteen

issues on which they came to agreement. Kay handwrote110 the thirteen points on a

sheet of paper that he scanned and sent to Campbell.111 The list of thirteen points

contemplated that any new equity capital would be raised by issuing up to 17% of

the equity of the Eagle Force Holdings subsidiaries, not through issuing equity of

Eagle Force Holdings.112 Eagle Force Holdings would own 80% of the subsidiaries’

equity, and the remaining 3% would be used for a new employee SARs program—

the details of which were still to be determined.113 The list stated that Campbell

cannot lose his salary or be fired. Further, the list provides that Campbell has no

veto on new investors but that the subsidiaries will have three-person boards with

109
      Id.
110
      Tr. 345 (Kay).
111
      JX 56.
112
      Id.
113
      Id.

                                         25
Mitchell Johnson as the third person.114 Another one of the thirteen points provided

that “[Salah] will be entitled to SAR only if [Campbell] wants to give non-voting

equity. It is from his side. [Salah] not a CFO. [Kay] is not obligated at all for

[Salah].”115 The other issues on the list were operational level issues such as

“[Campbell] & [Kay] will talk daily on big issues,” and “[Kay] & [Campbell] agree

we will push Chris Cresswell to close first 3 deals ASAP.”116

      On August 19, 2014, Rogers, Campbell’s attorney, sent revised versions of

the Transaction Documents. The August 19 versions that Rogers circulated back

tracked on some of Campbell’s concessions in the thirteen-point list.117        For

example, it included a veto right for Campbell with regard to new investors by

requiring that “for any additional capital contribution that has been requested or

accepted by a majority of the members of the board of directors or board of managers

(as applicable) of a Subsidiary, Campbell must approve the terms and conditions of

such additional capital contribution.”118 Rogers’s August 19 draft did incorporate

some of Kay’s requests, however. For example, Rogers’s August 19 version of the

114
      Id.
115
      Id.
116
      Id.
117
      JX 59.
118
      Id. § 4.1.8(a).

                                        26
Contribution Agreement included for the first time a provision requiring that Kay

fund an escrow to pay any claims by Campbell’s former creditors and that Campbell

take the steps necessary to reopen his bankruptcy.119

      On August 22, 2014, Campbell sent an email to Kay, Rogers, and Offit stating

that on the bankruptcy issue, he and Kay were each willing to commit up to $5,000

to retain Campbell’s personal bankruptcy lawyer and resolve the issue of his title to

the intellectual property.120 If that did not resolve the issue, Campbell agreed that

out of the $500,000 distribution he would take at closing, he would “retain up to

$250,000 in an attorney escrow of [his] choice for a period not to exceed 6

months.”121 Campbell was willing to set aside funds to pay any creditor claims, but

he did not want to reopen a bankruptcy proceeding.

      Another issue that remained open in the negotiations at the end of August was

how to handle the equity rights of certain EagleForce Associates employees,

including Salah, Salah’s brother Haney, Cresswell, and Morgan.122 Offit proposed

that the EagleForce Associates employees with SARs or rights to equity be asked to

relinquish their rights by signing a waiver and that they be told that “[a]s part of the

119
      JX 57; JX 58; JX 60; Tr. 894 (Rogers).
120
      JX 66.
121
      Id.
122
      JX 67.

                                          27
reorganization, we will be developing new and better defined executive incentive

benefits that will replace the commission program and/or stock appreciation rights

(SARS) plan in which you presently participate.”123 The evidence does not show

that either Campbell or Kay approached the EagleForce Associates employees to

resolve this issue, and as of October 2014, both Kay and Campbell wanted the other

to deal with the SARs issue.124 In the July 22, 2014 draft of the Contribution

Agreement, Offit included a specific reference to the SARs plan through adding

Campbell’s representation that “[e]xcept for the SARS Plan, there are no outstanding

options, warrants, calls, profit sharing rights, bonus plan rights, rights of conversion

or other rights, agreements, arrangements or commitments relating to Targeted

Companies Securities . . . .”125 Offit also added in the July 22 draft representations

that (1) Cresswell, Morgan, and five other EagleForce Associates employees had

executed releases for any profit sharing plan and (2) neither Salah, Cresswell, nor

any member of Salah’s family have any legal or equitable ownership interest in

EagleForce Associates or EagleForce Holdings.126 In Rogers’s August 19 draft, he

bolded and bracketed Offit’s additions and noted “[CAMPBELL] CANNOT

123
      JX 72.
124
      JX 92.
125
      JX 52, § 4.3(b); JX 58, § 4.3(b); JX 78, § 4.3(b).
126
      JX 50, §§ 4.3(d), 4.3(e).

                                           28
GUARANTEE THIS. WE NEED TO DISCUSS.”127 I find that at least as of August

19, Offit and Kay were both aware of the fact that EagleForce Associates had not

received releases from the SARs holders.

      On August 27, Offit sent another round of revisions to the LLC Agreement

and the Contribution Agreement to Rogers, Kay, and Campbell with a cover email

stating “[p]lease confirm your acceptance of the terms of these agreements. Please

commence preparation of schedules needed for closing.”128 The date on the front of

and in the first paragraph of the draft Contribution Agreement remained blank in the

August 27 version. And Section 3.1 of the agreement stated, “the closing of the

Transactions (the ‘Closing’) shall be held at the office of the Company, commencing

at 10:00am local time on the date hereof (the ‘Closing Date’) or at such other time

and place as the Parties may agree upon in writing.”129

      The draft Contribution Agreement referenced schedules that supplemented

the representations and warranties in the agreement and that listed the property

Campbell was to contribute. And the draft stated in the recitals that “[t]he parties

hereto desire to set forth certain representations, warranties, and covenants made by

each to the others as an inducement to the consummation of such transactions, upon

127
      JX 58, §§ 4.3(d), 4.3(e).
128
      JX 68.
129
      JX 71, § 3.1.

                                         29
the terms and subject to the conditions set forth herein.”130 Schedule 2.2(b) listed

the intellectual property that Campbell planned to contribute. 131 But the other

schedules remained incomplete.       The August 27 version of the Contribution

Agreement states, “Campbell shall assign to the Company, and the Company shall

be obligated to assume, and shall assume, those agreements set forth on Schedule

3.5 attached hereto . . . .”132 Sections 4.20(d) and 4.20(f) make clear that Schedule

3.5 includes all of Campbell’s intellectual property license agreements.133 But

Schedule 3.5 is blank.134 The agreement also states, “Schedule 4.3(a) sets forth, as

of the date hereof, (i) the number and class of authorized securities for each Targeted

Company, (ii) the number and class of Targeted Companies Securities for each

Targeted Company and (iii) the number and class of Targeted Companies Securities

held of record by Campbell for each Targeted Company.”135 But Schedule 4.3(a) is

blank except for one line of bracketed text, which states, “[Also describe SARS

130
      Id. Recital D.
131
      Id. Sched. 2.2(b).
132
      Id. § 3.5.
133
      Id. §§ 4.20(d), 4.20(f).
134
      Id. Sched. 3.5.
135
      Id. § 4.3(a).

                                          30
Plan].”136 Section 4.12(c) of the August 27, 2014 Contribution Agreement states,

“[e]xcept as set forth on Schedule 4.12(c), neither the execution and delivery of this

Agreement, nor the consummation of the transactions contemplated hereby, . . . will

. . . accelerate the vesting, funding or time of payment of any compensation, equity

award or other benefit . . . .”137 Schedule 4.12(c) is also blank.138

      Many of Campbell’s representations, warranties, and covenants related to the

EagleForce businesses reference schedules that also are blank.             The draft

Contribution Agreement refers to the “Campbell Disclosure Schedules.”139 And that

term is defined as “the schedules prepared and delivered by Campbell for and to the

Company and dated as of the Execution Date which modify (by setting forth

exceptions to) the representations and warranties contained herein and set forth

certain other information called for by this Agreement.”140 But none of those

schedules were ever completed. For example, Schedule 4.6 is supposed to list any

contractual liabilities outside the ordinary course of business for EagleForce

136
      Id. Sched. 4.3(a).
137
      Id. § 4.12(c).
138
      Id. Sched. 4.12(c).
139
      Id. Ex. A.
140
      Id.

                                          31
Associates and EagleForce Health;141 Schedule 4.9 is supposed to list all real

property leases, subleases, or licenses to which EagleForce Associates or EagleForce

Health is a party;142 and Schedule 4.15(a) is meant to set forth any pending legal

proceedings involving EagleForce Associates, EagleForce Health, or their affiliates,

including Campbell.143 All of those schedules are blank.

       The version of the Contribution Agreement that Offit sent with his August 27

email stated “OK DRAFT 8-26-14” on the first page.144 The version of the LLC

Agreement that he sent did not have that notation, but the LLC Agreement was an

exhibit to the Contribution Agreement.145 Rogers was out of town when Offit sent

the August 27 draft Transaction Documents, and Offit received his out-of-office

reply.146

                8.      The events of August 28, 2014

       On August 28, 2014, Kay and Campbell once again met without their lawyers.

Kay and Campbell both testified that Kay came to EagleForce Associates’s offices

141
       Id. § 4.6.
142
       Id. § 4.9.
143
       Id. § 4.15(a).
144
       JX 71.
145
       JX 73; JX 71, Ex. B.
146
       JX 74.

                                           32
with Katrina Powers for the purpose of having Campbell and Kay sign the

Transaction Documents.147 Campbell was busy when they arrived but met with them

briefly.148 Because Campbell had to finish meeting with EagleForce developers,

Kay and Powers left to go to a restaurant five minutes away. 149 While Kay and

Powers were at the restaurant, Kay and Campbell sent several emails to each other.

First, Cresswell sent a non-disclosure agreement to Kay and Bryan Ackerman, the

Sentrillion general counsel, with Campbell on copy. 150 Campbell replied asking

Cresswell not to “forward this information outside of the company until I have had

a chance to review.”151 Kay responded, “[w]hat are you talking about outside the

company? We just talk [sic] 3 minutes ago. I will handle my swim lane.”152 About

ten minutes later, Kay wrote “1) Bryan is inside not outside. 2) For the record I will

handle all NDA contacts.”153 In reference to earlier emails regarding the NDA,

Campbell wrote to Kay, “[a]s you can see I am not on the mail routing and this is a

147
      Tr. 329 (Kay); Tr. 988 (Campbell); Tr. 267 (Powers).
148
      Tr. 329-30 (Kay).
149
      Id. at 330.
150
      JX 75.
151
      Id.
152
      Id.
153
      Id.

                                         33
bit troubling. Only you can make these folks know that we are equal partners.”154

Kay replied, “[e]veryone knows we are equal . . . . Please clarify w[ith] Chris and

Bryan that NDA are in buss lane [sic] and Rick will handle. And send me the signed

document if you want to go forward.”155 Around the same time, Cresswell sent an

email strategizing about how to “win” the Special Olympics as a client. Kay

responded only to Campbell, stating “[s]orry can’t do anything until the agreement

documents you have are signed. Did you sign?”156

      At around 7:00 p.m., Kay and Powers returned to the EagleForce Associates

offices. Kay, Powers, and Campbell met for only a few minutes, and both Kay and

Campbell signed the versions of the LLC Agreement and the Contribution

Agreement that Offit had sent by email on August 27, 2014.157 Campbell testified

that before the signing, Kay told him that Rogers and Offit “were done” with the

agreements.158 Campbell testified that he tried to call Rogers but was unable to reach

him because Rogers was out of the office.159 He testified that Kay tried to call Offit

154
      JX 76.
155
      Id.
156
      Id.
157
      Tr. 294-95 (Powers); Tr. 332-35 (Kay).
158
      Tr. 977 (Campbell).
159
      Id.

                                         34
but was also not able to reach him.160 Kay, in contrast, testified that he did not call

Offit or make any representations about Campbell’s lawyer.161

      After Kay and Campbell signed the agreements, Campbell walked around his

desk and embraced Kay and Powers.162

               9.   The aftermath of the August 28 signing
      On August 31, 2014, Kay and Campbell had breakfast with Said Salah and

discussed his involvement in the EagleForce businesses going forward, but they did

not resolve the SARs issue.163 And after the meeting, on September 2, Salah wrote

in an email to Kay and Campbell, “I congratulate both of you on your commitments

in forging this partnership, and thank you again for recognizing the unwavering

commitments I have displayed towards the success of EagleForce.”164

      On September 9, after Rogers returned from vacation, he sent revised drafts

of the Contribution Agreement and the LLC Agreement to Offit.165 Rogers did not

160
      Id. at 978.
161
      Id. at 334 (Kay).
162
      Id. at 240 (Powers); id. at 332 (Kay). Kay and Powers testified that Campbell
      hugged each of them after signing the Transaction Documents. Campbell testified
      at trial that instead of a hug, he gave Kay a dap handshake. Id. at 988 (Campbell).
163
      JX 80.
164
      Id.
165
      JX 83.

                                          35
know that Kay and Campbell had signed the documents at that time,166 and Offit

never told Rogers that the escrow agreement for the signature pages was no longer

in effect because Kay and Campbell had signed the agreements.167 In his September

9 email, Rogers noted two outstanding issues related to the Contribution Agreement.

First, the new SARs plan remained undefined, and Rogers reiterated that Campbell

could not represent (1) that certain EagleForce Associates and EagleForce Health

employees had executed releases or (2) that neither Salah, Salah’s family members,

nor Cresswell had any legal or equitable interest in EagleForce Associates or

EagleForce Health.168 Rogers commented as follows:

             THERE IS STILL MUCH THAT NEEDS TO BE
             CLARIFIED HERE: (1) We are not confident that we
             have all of the SAR Plan offers; (2) Burden of the SARs
             should not be solely on [Campbell] because [Kay]
             authored it; (3) Chris Cresswell’s offer was developed by
             [Kay]; (4) There was a discussion about the company
             taking responsibility for the SARs up to a certain level.
             We need to understand what percentage of SARs was
             originally granted to understand the ultimate impact on
             [Campbell].169

166
      Tr. 827 (Rogers).
167
      Id. at 831.
168
      JX 84, §§ 4.3(d), 4.3(e).
169
      Id. § 4.3(d).

                                        36
Second, Rogers stated that financial representations in the Contribution Agreement

regarding the status of EagleForce Associates and EagleForce Health would be

“quite difficult to complete” because Rogers had no financial information regarding

the companies and believed that Kay had that information for the previous six

months.170 As to the LLC Agreement, Rogers removed the provision governing how

Mitchell Johnson’s successor as the third director on the subsidiary boards would be

chosen.171 And Rogers added a provision requiring that Campbell and Kay always

vote in favor of increasing Campbell’s salary to be commensurate with similarly

situated officers of similar companies.172 The record does not indicate that Campbell

had previously demanded that his salary be increased to reflect industry standards.

      In September 2014, Kay and Campbell continued to discuss the missing

aspects to their agreement. On September 16, 2014, Campbell provided certain

EagleForce billing information to Kay in an email and wrote, “[a]ttached is the

invoice and summary related to outstanding billings as required from me related to

closing.”173 Campbell stated that Kay’s staff had access to all of the information

170
      JX 83.
171
      JX 86, § 4.1.8.
172
      Id. § 4.1.8(b).
173
      JX 88.

                                         37
required to create a balance sheet and income statement.174 Kay responded asking

for clarification and wrote, “[w]e need to complete the paperwork so I can fully

fund.”175

      Offit, Rogers, Kay, and Campbell had a conference call on September 17 to

discuss Rogers’s proposed changes to the August 28 agreements. 176 Offit testified

that Kay stated on the call that he was willing to discuss potential amendments to

the agreements but was not willing to rescind and re-execute them.177 But Rogers

did not remember the contents of that call.178

      On October 7, 2014, Kay sent an email to Jashuva Variganti and Campbell

asking whether Variganti had distributed the paychecks issued October 6 to the

EagleForce Associates employees and asking that if they had not been distributed

that the checks be returned to Kay for him to distribute.179 Campbell responded,

requesting that Kay avoid communicating with the EagleForce staff and stating, “we

remain un-closed and this opportunity still does not have the remaining elements in

174
      Id.
175
      Id.
176
      Tr. 106 (Offit).
177
      Id.
178
      Id. at 855-56 (Rogers).
179
      JX 91.

                                         38
agreement.”180 Kay responded on October 8, stating in part, “[w]e have signed our

agreements and are awaiting the exhibits. [Offit] told me that [Rogers] has 2 open

issues” related to the boards of directors of the subsidiaries and the SARs program.181

Campbell did not respond to the October 8 email.182

      Negotiations stalled for much of the rest of October 2014. On October 15,

Rogers sent an email to Offit stating, “[i]t seems that the ‘stall’ in getting this deal

done is clearly the modification to Said’s and his brother’s deal. We can argue over

all the reasons as to why this isn’t happening, but the fact is that [Kay] wants

[Campbell] to deal with it, [Campbell] wants [Kay] to deal with it and, as a result,

nothing is happening.”183 Offit did not respond until October 21 when he wrote,

“Rick is away. I have a call into Rick and I’m looking for an update.”184

      On October 28, Kay emailed Campbell, Rogers, and Offit stating, “[w]hat else

can we do together to get this done. I understand we have signed the deal but need

the exhibits.”185 Campbell responded, stating in part, “[t]he signatures on the drafts

180
      Id.
181
      Id.
182
      Id.
183
      JX 92.
184
      Id.
185
      JX 93.

                                          39
did not represent the completed document which remains not completed given the

two or three remaining items.”186 He also wrote, “I have closed/settled the only item

that the Bankruptcy Atty indicated could cause any issue. . . . I would ask that the

responsibility for me to re-open the Bankruptcy be withdrawn from

consideration/requirement.”187

      In November 2014, Kay and Campbell’s relationship became more

contentious, as Kay and Offit took the position that the August 28 Transaction

Documents were binding contracts and that Campbell was in breach by failing to

contribute his intellectual property and reopen his bankruptcy.188 Kay nevertheless

continued to fund the EagleForce Associates payroll into February 2015.189

      Finally, on February 18, 2015, Campbell sent an email to Offit, Rogers, Kay,

and Cresswell stating as follows:

               [W]e have reached an impass [sic] that we are unable to
               resolve. I would respectfully request that the atty’s get
               together to discuss the means and methods for us to close
               this matter and allow us to move on. We have booked the
               funding as a loan and will proceed with amending the

186
      Id.
187
      Id.
188
      JX 97.
189
      JX 106.

                                          40
             existing documentation in a means that is reasonable for
             us both.190

On March 17, 2015, Eagle Force Holdings and EF Investments filed this lawsuit to

enforce the August 28 Contribution Agreement and LLC Agreement.

      C.     This Litigation

      Plaintiffs filed the original complaint in this case on March 17, 2015 and the

First Amended Complaint—the operative complaint—on June 5, 2015 (the

“Complaint”). Vice Chancellor Parsons entered an interim relief order on July 23,

2015 (the “Order”). The Order is designed to give EF Investments regular access to

information regarding EagleForce Associates and EagleForce Health during the

pendency of this litigation. Under the Order, Campbell must notify Plaintiffs ten

days before either EagleForce Associates or EagleForce Health enters certain

transactions, and Plaintiffs have a right to object in writing. If Plaintiffs object,

Campbell cannot engage in a transaction covered by the Order without an order of

this Court. The most expansive advanced notice provision of the Order requires ten

business days’ advanced notice for any transaction or series of transactions with a

single person over $5,000 in value in the aggregate. Any such advanced notice must

include the text “NOTICE TO PLAINTIFFS OF PROPOSED ACTION BY

DEFENDANT” in bold type under paragraph 4 of the Order. Further, the Order

190
      JX 103.

                                         41
requires regular reports regarding the EagleForce Associates and EagleForce Health

businesses. The reports include weekly reports describing all sales or distribution

leads regarding the Disputed IP, weekly bank statements, weekly accounts

receivable and payable reports, and payroll statements every two weeks.

      On May 27, 2016, Plaintiffs moved to hold Campbell in contempt for

violations of the Order. The Court held an evidentiary hearing on the motion for

contempt on August 31, 2016. At the end of that day, the Court ordered the parties

to return the next day to complete the hearing. Plaintiffs’ attorneys appeared on

September 1, 2016, but Defendant did not appear. The Court rescheduled the

remainder of the hearing for September 8, 2016 and completed the hearing that day.

At the September 8, 2016 hearing, the Court held that Campbell failed to provide

Plaintiffs with advanced notice before withdrawing approximately $100,000 in

accrued unreimbursed expenses from EagleForce Associates and paying

approximately $38,000 in vendor fees. On December 15, 2016, the Court ordered

Campbell to pay Plaintiffs’ attorneys’ fees for their September 1, 2016 appearance

at this Court when Campbell did not appear as a partial remedy for Campbell’s

contempt. The Court deferred any further remedy until after the trial in this case in

part because the question of this Court’s jurisdiction over Campbell remained

undecided. Campbell was ordered to pay that portion of Plaintiffs’ attorneys’ fees

on or before December 23, 2016. Campbell deposited a check for the attorneys’ fees

                                         42
into Kay’s personal bank account on December 27, 2016, the business day after

December 23, 2016.191

      Beginning on February 6, 2017, this Court held a five-day trial in this case.

On March 6, 2017, Plaintiffs filed a supplemental motion to hold Campbell in

contempt for additional violations of the interim relief order. The parties filed post-

trial opening briefs on March 29, 2017. In connection with Campbell’s opening

post-trial brief, he also filed a motion to amend the pleadings to conform to the

evidence submitted at trial with respect to the defenses of unilateral and mutual

mistake. The parties filed post-trial answering briefs on April 7, 2017. On May 5,

2017, the Court heard post-trial oral argument and held an evidentiary hearing on

Plaintiffs’ supplemental motion to hold Campbell in further contempt of the interim

relief order. On May 24, 2017, Plaintiffs filed a second supplemental motion to hold

Campbell in contempt for an additional alleged violation of the Order. This Court

held an additional evidentiary hearing on Plaintiffs’ second supplemental motion for

contempt on August 28, 2017. This post-trial opinion also resolves all outstanding

motions in this case.

191
      Letter to the Court from David Finger, Eagle Force Hldgs. LLC v. Campbell, C.A.
      No. 10803-VCMR, Ex. E (Del. Ch. Jan. 10, 2017).

                                          43
II.   ANALYSIS

      Plaintiffs’ Complaint alleges claims for breach of contract and breach of

fiduciary duty. Plaintiffs seek an order requiring Campbell to specifically perform

his obligations under the Transaction Documents and granting monetary damages to

Plaintiffs. In the alternative, Plaintiffs assert claims for fraud and unjust enrichment.

Campbell is a resident of Virginia, and he has objected to the personal jurisdiction

of this Court throughout these proceedings. In this unusual case, a full trial was

necessary to resolve the question of personal jurisdiction because whether Campbell

consented to personal jurisdiction in Delaware depends on whether Campbell is

bound by the Transaction Documents.192

      A.     Standards of Review for Contract Formation

      Plaintiffs have the burden of establishing by a preponderance of the evidence

that Campbell is bound by the Transaction Documents and, thus, is subject to

personal jurisdiction in Delaware.193 “Proof by a preponderance of the evidence

means proof that something is more likely than not. ‘By implication, the

192
      Eagle Force Hldgs., LLC v. Campbell, C.A. No. 10803-VCP, at 48-49 (Del. Ch.
      July 9, 2015) (TRANSCRIPT).
193
      Revolution Retail Sys., LLC v. Sentinel Techs., Inc., 2015 WL 6611601, at *9 (Del.
      Ch. Oct. 30, 2015).

                                           44
preponderance of the evidence standard also means that if the evidence is in

equipoise, Plaintiffs lose.’”194

      To enforce the Delaware forum selection clause, Plaintiffs must prove that

they formed a valid contract with Campbell.195 It is well-settled Delaware law that

“a valid contract exists when (1) the parties intended that the contract would bind

them, (2) the terms of the contract are sufficiently definite, and (3) the parties

exchange legal consideration.”196 “To determine whether a contract was formed, the

court must examine the parties’ objective manifestation of assent, not their

subjective understanding.”197 “If terms are left open or uncertain, this tends to

demonstrate that an offer and acceptance did not occur.”198

      Chancellor Allen held in Leeds v. First Allied Connecticut Corp. that “[i]t is

when all of the terms that the parties themselves regard as important have been

194
      Id. (quoting 2009 Caiola Family Tr. v. PWA, LLC, 2015 WL 6007596, at *12 (Del.
      Ch. Oct. 14, 2015)).
195
      The parties raise the question of which jurisdiction’s law applies to this case, but
      they do not brief the choice of law issue. The briefing relies heavily on Delaware
      law, and neither of the parties asserts that the law of Delaware is in conflict with the
      law of any other jurisdiction whose law may apply. The Court, thus, will apply
      Delaware law to all issues addressed in this opinion.
196
      Osborn ex rel. Osborn v. Kemp, 991 A.2d 1153, 1158 (Del. 2010).
197
      Trexler v. Billingsley, 2017 WL 2665059, at *3 (Del. June 21, 2017).
198
      Ramone v. Lang, 2006 WL 905347, at *11 (Del. Ch. Apr. 3, 2006).

                                            45
negotiated that a contract is formed.”199 Under Delaware’s objective theory of

contract law, the Court must determine “whether agreements reached were meant to

address all of the terms that a reasonable negotiator should have understood that the

other party intended to address as important.”200 “Agreements made along the way

to a completed negotiation, even when reduced to writing, must necessarily be

treated as provisional and tentative.        Negotiation of complex, multi-faceted

commercial transactions could hardly proceed in any other way.”201 To conduct such

an analysis, courts review “all of the surrounding circumstances, including the

course and substance of the negotiations, prior dealings between the parties,

customary practices in the trade or business involved and the formality and

completeness of the document (if there is a document) that is asserted as culminating

and concluding the negotiations.”202 “Until it is reasonable to conclude, in light of

all of these surrounding circumstances, that all of the points that the parties

199
      Leeds v. First Allied Conn. Corp., 521 A.2d 1095, 1101 (Del. Ch. 1986); see also
      CSH Theatres, LLC v. Nederlander of San Francisco Assocs., 2015 WL 1839684,
      at *15 (Del. Ch. Apr. 21, 2015) (“[A]n enforceable contract must contain all material
      terms of the agreement and material provisions that are indefinite will not be
      enforced.” (quoting Gallagher v. E.I. DuPont De Nemours & Co., 2010 WL
      1854131, at *3 (Del. Super. Ct. Apr. 30, 2010)) (internal quotation marks omitted)).
200
      Leeds, 521 A.2d at 1102; see also Gillenardo v. Connor Broad. Del. Co., 1999 WL
      1240837, at *4-5 (Del. Super. Ct. Oct. 27, 1999).
201
      Leeds, 521 A.2d at 1102.
202
      Id.

                                           46
themselves regard as essential have been expressly or . . . implicitly resolved, the

parties have not finished their negotiations and have not formed a contract.”203

“Thus, determination of whether a binding contract was entered into will depend on

the materiality of the outstanding issues in the draft agreement and the circumstances

of the negotiations.”204

      B.     The Transaction Documents Lack Terms that Were Essential to
             the Parties’ Bargain
      Campbell asserts that certain material terms are missing from the Transaction

Documents, showing that the parties never came to agreement and rendering the

Transaction Documents unenforceable. In particular, Campbell argues that the

closing date, all schedules to the Transaction Documents except for Schedule 2.2(b),

definitions of the terms “Insurance Claim” and “IP Disclosure Schedule,” and

aggregate dollar figures for certain representations are missing from the Transaction

Documents.205

203
      Id.; see also J.W. Childs Equity P’rs, L.P. v. Paragon Steakhouse Restaurants, Inc.,
      1998 WL 812405, at *4 (Del. Ch. Nov. 6, 1998) (finding that a letter agreement to
      sell at least 60 parcels of real property that listed only 17 sites in exhibit A was not
      a contract to sell property).
204
      Greetham v. Sogima L-A Manager, LLC, 2008 WL 4767722, at *15 (Del. Ch. Nov.
      3, 2008).
205
      Def.’s Pre-Trial Br. 13-20.

                                            47
             1.     Kay and Campbell failed to agree on terms regarding the
                    consideration to be exchanged
      Campbell’s primary obligation under the text of the Contribution Agreement

would be to contribute the stock of EagleForce Associates, the membership interests

of EagleForce Health, certain intellectual property related to the EagleForce

businesses, and certain contractual rights and obligations. The precise scope of that

consideration was to be captured in Sections 2.2 and 3.5 of the Contribution

Agreement and Schedules 2.2(b), 3.5, 4.3(a), and 4.12(c). But those portions of the

Transaction Documents are either blank or inconsistent with the reality of which

Campbell, Kay, Offit, and Rogers were aware.

      Section 2.2(a) of the Contribution Agreement states that part of Campbell’s

contribution shall be “all right, title and interest in the Targeted Companies

Securities, such that, after such contribution, the Company shall hold all of the

Targeted Companies Securities.”206 Section 4.3(a) of the Contribution Agreement

provides that “Schedule 4.3(a) sets forth, as of the date hereof, (i) the number and

class of authorized securities for each Targeted Company, (ii) the number and class

of Targeted Companies Securities for each Targeted Company and (iii) the number

and class of Targeted Companies Securities held of record by Campbell for each

206
      JX 78, § 2.2(a).

                                         48
Targeted Company.”207 But Schedule 4.3(a) is blank except for the bracketed text

“[Also describe SARS Plan].”208 Thus, the schedule that was meant to list an

important part of the consideration Campbell would provide under the agreement is

incomplete.

      The objective evidence of the course of the parties’ negotiations shows that

whether Campbell owns all of the equity in EagleForce Health and EagleForce

Associates is not clear. Salah, Salah’s brother Haney, Cresswell, and Morgan all

have employment agreements that give them some form of equity in the EagleForce

businesses.209 Throughout the negotiation of the Transaction Documents, Kay and

Offit were concerned about employee claims for some of the equity of EagleForce

Associates or EagleForce Health. And the evidence shows that Kay knew of at least

Salah’s and Cresswell’s claims to EagleForce Health and EagleForce Associates

equity.210 Kay and Campbell’s list of thirteen points recognized the problem of the

SARs program and began to develop a solution under which Campbell and Kay

would each retain equal control,211 but that was never incorporated into the

207
      Id. § 4.3(a).
208
      JX 79, Sched. 4.3(a).
209
      May 5, 2017 Hr’g Ex. 6.
210
      Tr. 653 (Cresswell); Tr. 1094 (Salah).
211
      JX 56.

                                          49
Transaction Documents. Instead, Offit included representations from Campbell in

the Transaction Documents that Campbell had obtained releases from Cresswell,

Morgan, and five other EagleForce employees related to their revenue sharing or

profit sharing plans and that neither Salah, Salah’s family, nor Cresswell had any

interest in the EagleForce businesses.       But Campbell never agreed to those

representations.212 To the contrary, in Rogers’s August 19 draft, Rogers commented

below the representation, “[CAMPBELL] CANNOT GUARANTEE THIS. WE

NEED TO DISCUSS.”213 Rogers’s comment was removed in Offit’s August 27

version, which Kay and Campbell signed on August 28 while Rogers was out of

town and unreachable.214

      Even after the August 28 signing, Kay, Campbell, Offit, and Rogers knew

they had not come to agreement on the employee claims for equity and the SARs

plan. In the September 9 version of the Transaction Documents that Rogers sent

post-signing, Rogers again commented that Campbell could not agree to the

representation regarding the employee releases, stating:

             THERE IS STILL MUCH THAT NEEDS TO BE
             CLARIFIED HERE: (1) We are not confident that we
             have all of the SAR Plan offers; (2) Burden of the SARs
             should not be solely on [Campbell] because [Kay]

212
      JX 50, §§ 4.3(d), 4.3(e).
213
      JX 58, § 4.3(d).
214
      JX 78, § 4.3(d).

                                        50
               authored it; (3) Chris Cresswell’s offer was developed by
               [Kay]; (4) There was a discussion about the company
               taking responsibility for the SARs up to a certain level.
               We need to understand what percentage of SARs was
               originally granted to understand the ultimate impact on
               [Campbell].215

And Rogers included additional questions about the SARs Plan in his September 9

cover email.216 As such, both Kay and Campbell recognized that Campbell likely

does not own 100% of the equity of EagleForce Associates and EagleForce Health,

and Campbell had not obtained releases related to any employees’ potential

ownership of equity in the EagleForce businesses. Despite this knowledge, they did

not come to agreement on terms that addressed the reality.

      Further, Section 4.12(c) of the Contribution Agreement states that “[e]xcept

as set forth on Schedule 4.12(c), neither the execution and delivery of this

Agreement, nor the consummation of the transactions contemplated hereby, . . . will

. . . accelerate the vesting, funding or time of payment of any compensation, equity

award or other benefit . . . .”217 Cresswell and Morgan appear to have SARs rights

under their employment agreements that automatically vest upon a sale or change of

215
      JX 84, § 4.3(d).
216
      JX 83.
217
      JX 78 § 4.12(c).

                                          51
control,218 and Kay knew of that fact at least as to Cresswell’s SARs.219 But

regardless, schedule 4.12(c) is blank.220

      Kay and Campbell also did not reach agreement on which contracts Campbell

would assign to Eagle Force Holdings as another part of the consideration in this

proposed deal.        The Contribution Agreement that the parties signed states,

“Campbell shall assign to the Company, and the Company shall be obligated to

assume, and shall assume, those agreements set forth on Schedule 3.5 attached

hereto . . . .”221 Sections 4.20(d) and 4.20(f) make clear that Schedule 3.5 includes

all of Campbell’s intellectual property license agreements.222 But Schedule 3.5 also

is blank. Campbell’s intellectual property listed in Schedule 2.2(b) is the only

portion of Campbell’s consideration outlined in the Transaction Documents on

which the parties appear to have completed negotiations. Absent definite terms

regarding the remainder of the property to be contributed, I find that Campbell and

Kay did not come to agreement on the consideration that Campbell would provide

in the Transaction Documents.

218
      May 5, 2017 Hr’g Ex. 6.
219
      JX 84, § 4.3(d); Tr. 653 (Cresswell).
220
      JX 79, Sched. 4.12(c).
221
      JX 78, § 3.5.
222
      Id. §§ 4.20(d), 4.20(f).

                                              52
      The precise consideration to be exchanged between Campbell and Eagle

Force Holdings was highly material to the parties here.           Presumably, the

consideration that Campbell would provide to Eagle Force Holdings would directly

affect the number of units or the size of the capital account Eagle Force Holdings

would provide to Campbell. And division of the equity in Eagle Force Holdings was

extremely important to Campbell and Kay. From the beginning of Campbell and

Kay’s negotiations, they communicated to each other that it was very important that

they both be 50% owners of the ultimate holding company. The November 2013

letter agreement provides that both Campbell and Kay would own 50% of the new

LLC, and they agreed “to never dilute [their stakes to] less than 50.1% together in

order to maintain control. They will also agree that their vote will always be

uniformly tied as a single vote thus protecting [Campbell] from complete loss of

control.”223 Similarly, the April 2014 letter agreement also contemplated that

Campbell would own 50% of “Holdco,” and Kay and Campbell together would not

be diluted below 51% of “Holdco,” a slightly higher threshold than the 50.1% in the

November letter agreement.224

      At the July 7, 2014 meeting at Rogers’s office that went late into the night,

the parties resolved that Eagle Force Holdings would not issue new equity capital

223
      JX 1, ¶ 5.
224
      JX 12, ¶ 5.

                                        53
for the additional $5.5 million they wanted to raise. This would allow Campbell and

Kay to retain equal control of the entire EagleForce business.225 Instead, the

subsidiaries would issue equity in exchange for new capital, but Eagle Force

Holdings would retain 80% control of the subsidiaries.226 That term was reiterated

in the handwritten list of thirteen points to which Campbell and Kay agreed without

their lawyers present.227

      Additionally, on August 28, 2014, approximately one hour before Kay and

Campbell signed the Transaction Documents, they exchanged emails that highlight

how important it was to both of them that Kay and Campbell both have equal control.

Cresswell sent a non-disclosure agreement to Kay and Bryan Ackerman, the

Sentrillion general counsel, with Campbell on copy. 228 Campbell replied asking

Cresswell not to “forward this information outside of the company until I have had

a chance to review.”229 Kay responded, “[w]hat are you talking about outside the

company? We just talk [sic] 3 minutes ago. I will handle my swim lane.”230 About

225
      Tr. 64-66 (Offit).
226
      Id.
227
      JX 56.
228
      JX 75.
229
      Id.
230
      Id.

                                        54
ten minutes later, Kay wrote “1) Bryan is inside not outside. 2) For the record I will

handle all NDA contacts.”231 In reference to earlier emails regarding the NDA,

Campbell wrote to Kay, “[a]s you can see I am not on the mail routing and this is a

bit troubling. Only you can make these folks know that we are equal partners.”232

Kay replied, “[e]veryone knows we are equal . . . . Please clarify w[ith] Chris and

Bryan that NDA are in buss lane [sic] and Rick will handle. And send me the signed

document if you want to go forward.”233 Thus, just before signing, Campbell

reiterated that he and Kay must be equal partners. And Kay’s emails show that equal

control was a material term to Kay as well.234

231
      Id.
232
      JX 76.
233
      Id.
234
      Campbell and Kay were concerned about loss of control and dilution in part because
      they did not trust one another. See Tr. 803 (Campbell). On April 30, 2014,
      Campbell wrote to Kay, “I am no longer enjoying coming to work. I do not think
      this will work. Please tell me what I owe you and how we can move forward
      independently.” JX 130. And during the spring or summer of 2014, Kay met with
      Cresswell at a country club in Potomac, Maryland and told Cresswell that Campbell
      had previously committed fraud. Tr. 656-59 (Cresswell). Further, on June 30, 2014,
      Campbell received an email from Kay with what Campbell believed to be a racial
      slur. JX 16. Kay was also particularly concerned about Salah’s equity in the
      EagleForce businesses because he did not work well with Salah. Tr. 1087-88
      (Salah); id. at 1174 (Morgan). Kay made clear in the handwritten list of thirteen
      points that “[Salah] will be entitled to SAR only if [Campbell] wants to give non-
      voting equity. It is from his side. [Salah] not a CFO. [Kay] is not obligated at all
      for [Salah].” JX 56.

                                           55
      Campbell and Kay planned for Kay to contribute $2,300,000 in cash because

$2,300,000 was the value of Campbell’s anticipated contribution. 235 To the extent

Campbell’s actual contribution was less than originally contemplated, the

negotiating parties would have to confront the issue of how the precise assets

Campbell contributes to Eagle Force Holdings would affect the number of units

Eagle Force Holdings issues to Campbell—and, in turn, which party obtains control

over Eagle Force Holdings. Campbell and Kay acknowledged this reality both

before and after the signing.236 As such, the objective circumstances of the parties’

negotiating history show that Sections 2.2(a) and 3.5 of the Contribution Agreement

and Schedules 4.3(a) and 4.12(c)—which would have listed Campbell’s holdings in

EagleForce Associates and EagleForce Health, any Cresswell, Morgan, or Said or

Haney Salah holdings in those companies, and any holdings associated with the

SARs Plan—and Schedule 3.5—which would have listed the contract rights and

liabilities Campbell planned to contribute—related to terms that the parties

considered essential and on which they had not completed negotiations.237

235
      JX 12, ¶ 6.
236
      JX 56; JX 84, § 4.3(d).
237
      J.W. Childs Equity P’rs, L.P. v. Paragon Steakhouse Restaurants, Inc., 1998 WL
      812405, at *3 (Del. Ch. Nov. 6, 1998); RESTATEMENT (SECOND) OF CONTRACTS §
      33 (AM. LAW INST. 1981) (“The terms of a contract are reasonably certain if they
      provide a basis for determining the existence of a breach and for giving an
      appropriate remedy.”).

                                         56
      Plaintiffs contend that Campbell was obligated to provide the schedules. They

are referenced as the Campbell Disclosure Schedules in the Contribution

Agreement.238 And that term is defined as “the schedules prepared and delivered by

Campbell for and to the Company and dated as of the Execution Date which modify

(by setting forth exceptions to) the representations and warranties contained herein

and set forth certain other information called for by this Agreement.”239 But the

parties were still negotiating on Schedules 3.5, 4.3(a), and 4.12(c). And the evidence

indicates that Kay and Campbell had not agreed on who would create certain of the

schedules. While both Campbell and Kay appear to have worked slowly, or in some

cases not at all, on the Transaction Documents schedules other than Schedule 2.2(b),

the evidence does not indicate that they agreed to complete the Transaction

Documents without those schedules.240

238
      JX 78, Ex. A.
239
      Id.
240
      This opinion does not address whether Campbell and Kay entered a binding contract
      (such as the letter agreements) that lacks a Delaware forum selection clause because
      the Court does not have jurisdiction to reach that question. It also does not address
      any other theory of liability that may arise from Kay and Campbell’s relationship.

                                           57
             2.       The parties did not assent to the terms of the LLC Agreement
                      separately from the Contribution Agreement
      As to the LLC Agreement, the evidence shows that Kay and Campbell did not

agree to the terms of the LLC Agreement separately from the closely related terms

of the Contribution Agreement.        From the beginning of Campbell and Kay’s

discussions, the two parties sought to combine resources to market the PADRE

technology through a well capitalized business.241 As early as the November 2013

letter agreement, Campbell and Kay wanted to form a new limited liability company

in connection with that business venture.242 And the Transaction Documents that

Kay and Campbell signed on the same day repeatedly reference one another,243

indicating that neither agreement was designed to stand alone. The Contribution

Agreement that Kay and Campbell signed states, “[a]t the Closing, the Company,

Campbell and EFI shall enter into and deliver the Company LLC Agreement in the

form of Exhibit B.”244 Exhibit B to the Contribution Agreement is a placeholder for

the LLC Agreement.245 Unlike the Contribution Agreement, the LLC Agreement

that Campbell and Kay signed does not say “OK DRAFT 8-26-14” on the cover

241
      Tr. 774 (Campbell); JX 1.
242
      JX 1, ¶¶ 7-8.
243
      JX 78, Recital C, § 2.3; JX 79, § 3.2.1.
244
      JX 78, § 3.4.
245
      Id. Ex. B.

                                           58
page,246 which suggests that the cover page to the Contribution Agreement was

considered the cover page to the Transaction Documents as a whole, and the LLC

Agreement was an exhibit. And many of the blank schedules to the Contribution

Agreement are actually attached to the LLC Agreement.247 Further, no one asserts

that Campbell and Kay intended to enter into the LLC Agreement separate and apart

from a Contribution Agreement.248         Rather, “the parties intended these two

Agreements to operate as two halves of the same business transaction.”249 Thus, the

LLC Agreement and the Contribution Agreement rise and fall together. Kay and

Campbell did not intend to bind themselves to the written terms in the Transaction

Documents, and this Court does not have personal jurisdiction over Campbell

through his consent.

      C.    Absent Campbell’s Consent, This Court Lacks Personal
            Jurisdiction over Campbell
      Without Campbell’s consent, this Court cannot exercise personal jurisdiction

over Campbell.     Plaintiffs do not argue that Campbell is subject to personal

jurisdiction in Delaware pursuant to the Delaware long-arm statute. They do

246
      Compare JX 78, with JX 79.
247
      See JX 79 (including Schedules 4.3(a) and 4.12(c)).
248
      See Tr. 5; Pls.’ Opening Br. This does not mean that Campbell and Kay did not
      form a business entity. It simply means they had not completed negotiations on the
      Transaction Documents, which include the LLC Agreement.
249
      E.I. DuPont de Nemours & Co. v. Shell Oil Co., 498 A.2d 1108, 1115 (Del. 1985).

                                          59
contend that Campbell became a member and manager of Eagle Force Holdings by

executing the April 2014 letter agreement and, thus, impliedly consented to personal

jurisdiction in Delaware under Section 18-109(a) of the Delaware Limited Liability

Company Act.250 The April 2014 letter agreement “amends the letter agreement that

[Campbell and Kay] executed on November 27, 2013 that was dated as of November

15, 2013.”251 The November 2013 letter agreement states that Campbell and Kay

“will form a new LLC entity and/or a series of industry specific LLC’s [sic] verticals

in Virginia.”252 And the April 2014 letter agreement states that “a new LLC will be

formed to serve as a parent entity (‘Holdco’)”253 without any mention of Delaware.

Instead, it states, “[t]his letter agreement is legally binding upon the parties and shall

be governed by the laws of the State of Virginia.”254 Further, at the time of the April

2014 letter agreement, Campbell did not know that Kay had formed Eagle Force

Holdings in Delaware.255 The only agreements that mention a Delaware limited

liability company are the Transaction Documents, which are missing material terms

250
      6 Del. C. § 18-109(a).
251
      JX 12.
252
      JX 1, ¶ 2.
253
      JX 12, ¶ 2.
254
      Id. ¶ 18.
255
      Tr. 991-92 (Campbell).

                                           60
and, thus, are not enforceable. The April letter agreement does not serve as implied

consent to jurisdiction in Delaware.

      Plaintiffs also assert that Campbell actively participated in the management

of a Delaware limited liability company and, thus, impliedly consented to personal

jurisdiction in Delaware. The facts proven at trial, however, indicate that Campbell

managed only EagleForce Associates, a Virginia corporation, and EagleForce

Health, a Virginia limited liability company.      The record does not show that

Campbell ever managed Eagle Force Holdings or any other Delaware entity. As

such, Campbell is not subject to personal jurisdiction under Section 18-109.

      D.     Campbell’s Motion to Conform the Pleadings to the Evidence is
             Moot
      Campbell also has moved under Court of Chancery Rule 15(b) to conform the

pleadings to the evidence presented at trial by adding the defenses of unilateral and

mutual mistake to his answer.      But because this Court does not enforce the

Transaction Documents, the motion is moot.

      E.     The Interim Relief Order Does Not Bind Campbell

      Plaintiffs’ three motions for contempt allege that Campbell violated the

interim relief order. “A party petitioning for a finding of contempt bears the burden

to show contempt by clear and convincing evidence; the burden then shifts to the

                                         61
contemnors to show why they were unable to comply with the order.” 256 “To

establish civil contempt, [the petitioning party] must demonstrate that the

[contemnors] violated an order of this Court of which they had notice and by which

they were bound.”257

            The party charged [with contempt] is always at liberty to
            defend his disregard of the court’s order by showing that
            the order was void for lack of jurisdiction. In a contempt
            proceeding based upon the violation of an injunction, the
            only legitimate inquiry to be made by the court is whether
            or not it had jurisdiction of the parties and of the subject
            matter. Subject to this limitation the court will not listen
            to an excuse for the contemptuous action based upon an
            argument that the order in question was imperfect or
            erroneous. No person may with impunity disregard an
            order of the court having jurisdiction over the subject
            matter and of the parties.258

Because this Court lacks personal jurisdiction over Campbell, he was not bound by

the Order and cannot have committed contempt by violating the Order. Plaintiffs’

motions for contempt are denied.

256
      TR Inv’rs, LLC v. Genger, 2009 WL 4696062, at *15 (Del. Ch. Dec. 9, 2009).
257
      Id. (quoting Arbitrium (Cayman Islands) Handels AG v. Johnston, 1997 WL
      589030, at *3 (Del. Ch. Sept. 17, 1997)) (internal quotation marks omitted).
258
      Mayer v. Mayer, 132 A.2d 617, 621 (Del. 1957), quoted in Cohen v. State ex rel.
      Stewart, 89 A.3d 65, 90 n.115 (Del. 2014).

                                        62
III.   CONCLUSION

       For the reasons stated herein, this Court lacks personal jurisdiction over

Stanley Campbell, and the Complaint is dismissed. Defendant’s motion to conform

the pleadings to the evidence is denied as moot. Plaintiffs’ motions for contempt are

denied.

       IT IS SO ORDERED.

                                         63