In Virtus Capital v. Eastman Chemical, C.A. No. 9808-VCL (Del. Ch. Feb. 11, 2015), the Delaware Court of Chancery denied a motion to dismiss a complaint for lack of personal jurisdiction in a suit related to the 2011 sale of Sterling Chemicals Inc. to Eastman Chemical Co. that was allegedly orchestrated by Sterling’s controlling stockholder, Martin D. Sass. In the process of finding that the defendants were subject to personal jurisdiction in Delaware, Vice Chancellor J. Travis Laster indicated that the complaint contained allegations sufficient to state a claim that Sass had breached his fiduciary duties by allegedly causing Sterling to be sold at a “fire-sale” price and that Eastman had aided and abetted Sass’ breaches of fiduciary duty.
Although the case was at a preliminary stage procedurally, plaintiff Virtus Capital L.P. had engaged in substantial discovery during an appraisal proceeding related to the merger prior to bringing its fiduciary duty and aiding and abetting claims. Sass moved to dismiss the complaint for lack of personal jurisdiction. The court denied Sass’ motion, concluding that Virtus had made a factual showing that the elements of the conspiracy theory of jurisdiction had been satisfied.
