Court Opinion

ID: 5120628
Source: CourtListenerOpinion
Date Created: 2021-10-22 19:03:40.944076+00
Date Added: 2024-06-11T08:22:18.388291
License: Public Domain

COURT OF CHANCERY
                                  OF THE
 SAM GLASSCOCK III
  VICE CHANCELLOR
                            STATE OF DELAWARE                  COURT OF CHANCERY COURTHOUSE
                                                                        34 THE CIRCLE
                                                                 GEORGETOWN, DELAWARE 19947

                        Date Submitted: September 17, 2021
                         Date Decided: October 22, 2021

Matthew F. Davis, Esquire                      Julia B. Klein, Esquire
Justin T. Hymes, Esquire                       Klein LLC
Potter Anderson & Corroon LLP                  919 N. Market Street
1313 N. Market Street                          Suite 600
Hercules Plaza – 6th Floor                     Wilmington, Delaware 19801
Wilmington, Delaware 19801

              RE: Joshua J. Angel v. Warrior Met Coal, Inc., et al.
                  C.A. No. 2019-0235-SG

Dear Counsel:

      At this stage, this litigation involves a single claim for unjust enrichment by

Joshua J. Angel, the Plaintiff, against the Defendants. The matter is currently before

me on a Motion for Reconsideration (the “Reconsideration Motion”) sought by the

Defendants in response to my Letter Opinion, dated June 30, 2021 (the “Opinion”),

which addressed the Defendants’ Motion to Dismiss as to all claims (the “Motion to

Dismiss”) and the Defendants’ Motion for Partial Summary Judgment with respect

to claims affected by the notice issue (the “Summary Judgment Motion”). The

Opinion considered the pertinent issues under the applicable motion to dismiss

standard, and perceived the Summary Judgment Motion as solely intended to address
the breach of contract claim.1 As the breach of contract claim did not survive the

Motion to Dismiss, the Opinion mooted the Summary Judgment Motion. 2 The

parties have provided supplemental briefing with respect to the Reconsideration

Motion, and the Defendants have clarified that their Summary Judgment Motion

pertains more broadly to any and all claims that survive the Motion to Dismiss.3

Therefore, per the Defendants, their Summary Judgment Motion with respect to the

unjust enrichment claim is not mooted and should be granted. So finding would

resolve the remainder of the litigation.

       An adumbration of the facts sufficient to resolve the Summary Judgment

Motion follows. The Plaintiff was a lienholder of Walter Energy, Inc. (“Debtor”).4

Upon bankruptcy, a steering committee (the “Steering Committee”) formed of other

such lienholders, but not including the Plaintiff, sought to purchase the Debtor’s

assets in return for a release of debt.5 To accomplish this, the Steering Committee

proposed transferring the Debtor’s assets to Coal Acquisition LLC, now named

Warrior Met Coal LLC (“Warrior LLC”). 6 The Debtor’s creditors, including the

1
  Mem. Op. 3, Dkt. No. 76 [hereinafter “Op.”].
2
  Id. at 11.
3
  See Defs.’ Mot. for Recons. 2, Dkt. No. 77 [hereinafter “Recons. Mot.”].
4
  Op. at 4.
5
  Id. at 4–5.
6
  Id. at 6.
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Steering Committee, would then receive an equity distribution from Warrior LLC

(the “Distribution”).7

        The bankruptcy court required that the Distribution occur in compliance with

securities law. 8      To achieve this, Warrior LLC, the Steering Committee, the

indenture trustees and the trustee for the general unsecured creditors agreed that the

eligibility documentation (the “Documents”) would be distributed to prospective

participants and would contain temporal forfeiture provisions.9 Ultimately, the

group determined that the required Documents had to be completed and submitted

by December 31, 2016, after which date any outstanding rights to the Distribution

were forfeited. 10 The Plaintiff did not submit the Documents timely and did not

receive equity in the Distribution.11

        The Plaintiff alleges that he was not provided notice with respect to the

Documents, and that an unjust enrichment claim must lie against the Defendants,

because they were enriched (and he was impoverished) when his claim to a

Distribution of Warrior LLC equity was forfeited. 12 The Defendants seek dismissal

7
  Id.
8
  Id. at 2.
9
  Id.
10
   Id. at 8–9.
11
   See id. at 9, 22.
12
   Id.
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of the unjust enrichment claim on the grounds that notice was provided to the

Plaintiff. 13

       The Defendants allege a number of notices pertaining to the Distribution were

directed to the Plaintiff, either by Warrior LLC’s agent or by certain indenture

trustees. 14 The Plaintiff responds that Warrior LLC’s agent provided notices to

inappropriate email addresses, and that notices from the indenture trustees attached

to the Complaint were received “years later,” outside the pertinent timeframe. 15

       To succeed upon a motion for summary judgment, the moving party must

demonstrate that the record shows that there is no genuine issue of material fact, and

that the moving party is therefore entitled to judgment as a matter of law. 16 Upon

review of the record in connection with the Reconsideration Motion, certain factual

questions remain. In order to evaluate the remaining equitable claim, I will need a

sufficient record to determine, without purporting to be exhaustive: (i) whether

actual notice of the equity offering was delivered to the Plaintiff, either by the agent

employed by Warrior LLC to do so or by the applicable indenture trustees; (ii) if so,

which notice was received; (iii) if so, when the notice was received; and (iv) if so,

what actions the Plaintiff took or did not take, and why. The issue of notice with

13
   See generally Recons. Mot.
14
   See Tr. Oral Arg. Defs.’ Mots. Dismiss Compl., Am. Compl., and for Partial Summ. J., 8–10
Dkt. No. 74.
15
   Id. at 32–34.
16
   Paul v. Deloitte & Touche, 974 A.2d 140, 145 (Del. 2009) (quoting Berns v. Doan, 961 A.2d
506, 510 (Del. 2008) (internal citation omitted)).
                                              4
respect to the equity offering therefore cannot be determined in connection with the

Defendants’ Summary Judgment Motion.

       The Summary Judgment Motion is DENIED. To the extent the foregoing

requires an Order to take effect, IT IS SO ORDERED.

                                      Sincerely,

                                      /s/ Sam Glasscock III

                                      Sam Glasscock III

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