Document: General Video Corp. v. Kertesz, et al., C.A. No. 1922-VCL, Lamb, V.C. (Del. Ch. Dec. 17, 2008)

After the defendant minority owner of a corporation quit in order to start a similar venture, the remaining majority owner and insolvent entity sued to claim rights in the new venture as well as breaches of numerous agreements.  Following a three-day trial, the Court of Chancery found the plaintiffs’ claims factually and legally baseless and ruled in favor of the defendants.  First, as Delaware law does not require written notice of resignation be given to the corporation, an unequivocal statement by the defendant minority owner that he wanted out defeated any claims of breach of fiduciary duty arising from conduct occurring after such resignation. Next, the plaintiff corporation could not claim violation of the corporate opportunity doctrine because it was financially unable to exploit any such opportunities.  In addition, the Court dismissed claims of breach of fiduciary duty asserted against an attorney of the plaintiff corporation who then went into business with the defendant minority owner because there was no evidence that the attorney ever learned of anything confidential in his capacity as attorney.  Finally, due to lack of proof, the Court dismissed additional claims against the defendants.