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1
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MEMORANDUM OPINION (REVISED)
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EXTRACTED KEY WORDS
FEES EXPENSES DUNLAP PLAINTIFFS KERSH LEGAL FEES DELAWARE ATTORNEYS INDEMNIFICATION FORBEARANCE AGREEMENT DEFENDANT OPINION REASON AMOUNTS REASONABLENESS DELAWARE LAW AMOUNTS PAID ACCORDANCE LLP LITIGATION JUDGMENTS PROFESSIONAL FEES UNDERTAKING SECOND SENTENCE INVESTIGATIONS CONNECTION LIMITATIONS PWC WILMINGTON |
IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
IN AND FOR NEW CASTLE COUNTY
ALBERT J. DUNLAP and )
RUSSELL A. KERSH, ))
Plaintiffs, ))
V. ) Civil Action No. 17048
SUNBEAM CORPORATION, ))
Defendant. )
MEMORANDUM OPINION
Date Submitted: June 18,1999
Date Decided: June 23, 1999
Date Revised: July 9, 1999
Donald J. Wolfe, Jr., and Kevin R. Shannon, of POTTER ANDERSON &
CORROON LLP, Wilmington, Delaware; Attorneys for Plaintiffs.
Thomas J. Allingham, II, and Robert S. Saunders, of SKADDEN ARPS
SLATE MEAGHER & FLOM LLP, Wilmington, Delaware; Attorneys for
Defendant.
CHANDLER, Chancellor
This case, which was tried before me on J&e 15 and 16, 1999,
involves a discrete legal issue: whether defendant Sunbeam Corporation
("Sunbeam" or the "Company") is obligated to advance legal fees and other
expenses incurred by Albert J. Dunlap ("Dunlap") and Russell A. Kersh
("Kersh," and together with Dunlap, "Plaintiffs") following their tenure at
Sunbeam. For the reasons that follow, I conclude that Sunbeam must
advance these fees.
SNIPPETS:
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2
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PLAINTIFFS MOTION TO AMEND AND CLARIFY ORDER
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EXTRACTED KEY WORDS
FEES EXPENSES OPINION COURT INDEMNIFICATION AMOUNT SCHEDULE SUNBEAM CLARIFY INVOICES REQUEST HERETO MOTION ULTIMATE DISCRETE ATTORNEYS OBLIGATION PURPOSE LLP AMEND LEGAL FINDINGS EVIDENCE ASSERTION MANDATORY COUNSEL HEREBY SUPPORT FOREGOING RESPECTFULLY REQUEST |
IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
IN AND FOR NEW CASTLE COUNTY
ALRERT J. DUNLAP and RUSSELL A. KERSH, j>
Plaintiffs, j>
v. >) C.A. No. 17048
SUNl3EAM CORPORATION, >
a Delaware corporation. >
Defendant. >
LUNTIFFS MOTION TO AMEND AND CLARIFY
__- 0IRD:ER
Plaintiffs Albert J. Dunlap and Russell A. Kersh, by and through their
undersigned counsel, hereby move to amend and (clarify the Memorandum Opinion and Order
dated June 23, 1999 (the "Opinion"). In support of their Motion, Plaintiffs state as follows.
1. In its Opinion, the Court held that Defendant Sunbeam Corporation (Sunbeam")
was required to a'dvance fees and expenses to Plaintiffs and calculated the amount of such fees
through April 30, 1999. As explained below, the sum identified by the Court does not equal the
total amount of the fees and expenses set forth in the invoices of record reflecting fees and
expenses incurred as of that date and, therefore, Plaintiffs request that the Opinion be amended to
reflect such amounts. Plaintiffs further request that the Opinion be cl,arified to make clear that
the Court did not make any legal findings as to Plaintiffs' ultimate right to indemnification for
legal fees and expenses.
A. The Amount of Plaintiffs' Fees And Expenses Submitted Into
Evidence For The Period Through April 30, 1999 Is
_ Sll,736,589.61
3-. In its Opinion, the Court awarded `Plaintiffs the advancement of fees they seek _ _
in the amount of $1,403,322.21, which I calculate as $1,410,655.46 through, April 30, 1999, less
$7.337.25 (the amount the parties agreed to delete from the bills)." (Opinion at 16-17).
SNIPPETS:
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3
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MEMORANDUM OPINION
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EXTRACTED KEY WORDS
FEES EXPENSES DUNLAP KERSH PLAINTIFFS LEGAL FEES DELAWARE ATTORNEYS FORBEARANCE AGREEMENT INDEMNIFICATION DEFENDANT REASONABLENESS OPINION REASON AMOUNTS DELAWARE LAW AMOUNTS PAID ACCORDANCE LLP LITIGATION JUDGMENTS PROFESSIONAL FEES UNDERTAKING SECOND SENTENCE COMPLETED ACTIONS CONNECTION LIMITATIONS PWC WILMINGTON |
IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
IN AND FOR NEW CASTLE COUNTY
ALBERT J. DUNLAP and > ;I -'
RUSSELL A. KERSH, > _ i
> *--
Plaintiffs, ) I .,,_:
> ,> I
3-A
v. > Civil Action No. i7048
>
SUNBEAM CORPORATION, >>
Defendant. )
MEMORANDUM OPINION
Date Submitted: June 18, 1999
Date Decided: June 23, 1999
Donald J. Wolfe, Jr., and Kevin R. Shannon, of POTTER ANDERSON &
CORROON LLP, Wilmington, Delaware; Attorneys for Plaintiffs.
Thomas J. Allingham, II, and Robert S. Saunders, of SKADDEN ARPS
SLATE MEAGHER & FLOM LLP, Wilmington, Delaware; Attorneys for
Defendant.
CHANDLER, Chancellor
This case, which was tried before me on June 15 and 16, 1999,
involves a discrete legal issue: whether defendant Sunbeam Corporation
("Sunbeam" or the "Company") is obligated to advance legal fees and other
expenses incurred by Albert J. Dunlap ("Dunlap") and Russell A. Kersh
("Kersh," and together with Dunlap, "Plaintiffs") following their tenure at
SNIPPETS:
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4
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PLAINTIFFS PRETRIAL MEMORANDUM
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EXTRACTED KEY WORDS
SUNBEAM BYLAWS MANDATORY EXPENSES LEGAL FEES LITIGATION FOREBEARANCE AGREEMENT COURT PARTIES SHAREHOLDER/BONDHOLDER ADVANCEMENT REQUESTS DUNLAP PWC DELAWARE KERSH ADVANCEMENT PROVISION CONNECTION OBLIGATION FINANCIAL STATEMENTS UNDERTAKING INDEMNIFICATION REASONABLENESS DIRECTORS ASSERTION MEMORANDUM AUTHORITIES INTERPRETATION PENDING CIVIL SUNBEAM ASSERTS |
IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
IN AND FOR NEW CASTLE COUNTY
ALBERT J. DUNLAP and RUSSELL A. )
KERSH, ))
Plaintiffs, 1 C.A. No. 17048
)
V. 1
1
SUNBEAM CORPORATION, ))
Defendant. )
PLAINTIFFS' PRETRIAL MEMORANDUM
Donald J. Wolfe, Jr.
Kevin R. Shannon
Brian C. Ralston
POTTER ANDERSON & CORROON LLP
1313 North Market Street
Sixth Floor
P.O. Box 951
Wilmington, DE 19801
(302) 984-6000
Attorneys for Plaintiffs
Albert J. Dunlap and
Russell A. Kersh
Dated: June 14, 1999
374286
TABLE OF CONTENTS
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5
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SUNBEAMS PRE-TRIAL BRIEF
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EXTRACTED KEY WORDS
PLAINTIFFS RESTATEMENT FEES AGREEMENT BY-LAW ADVANCEMENT REQUESTS PWC FOREBEARANCE COURT ATTORNEYS FINANCIALS RESTRUCTURING FINANCIAL STATEMENTS CONNECTION DELAWARE DISCRETION INDEMNIFICATION SUBSTANTIAL PORTION ENGAGEMENT CONSULTING LITIGATION DIRECTORS SHAPIRO DEP REASONABLENESS INDEPENDENT AUDITORS INDEPENDENT ACCOUNTING FIRMS MANDATORY INDEMNIFICATION PRYOR CASHMAN DENY ADVANCE-OF ATTORNEYS |
IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
IN AND FOR NEW CASTLE COUNTY
________________-_-_----------------------------------------------------X
ALBERT J. DUNLAP and RUSSELL A. KERSH, :
Plaintiffs,
V. C.A. No. 17048
SUNBEAM CORPORATION,
Defendant.
_----------------------------------------------------------------------- X
SUNBEAM CORPORATION'S PRE-TRIAL BRIEF
SKADDEN, ARPS, SLATE
MEAGHER & FLOM LLP
One Rodney Square
P.O. Box 636
Wilmington, Delaware 19899
(302) 651-3000
Attorneys for Defendant
Dated: June 14, 1'999
TABLE OF CONTENTS
PRELIMINARY STATEMENT . . . . . . . . . . . . . . . . . . . . . . . .
STATEMENT OF FACTS . . . . . . . . . . . . . . . . . . . . . . . . . . .
I. NEITHER SUNBEAM'S BY-LAWS NOR THE FOREBEARANCE
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6
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MOTION TO STRIKE DEFENDANTS AFFIRMATIVE DEFENSES
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EXTRACTED KEY WORDS
PLAINTIFFS DEFENSES PROCEEDING REQUESTS COURT AGREEMENT FEES ASSERTS EXPENSES EXHIBIT MANDATORY INDEMNIFICATION OBLIGATIONS FOREBEARANCE AGREEMENT HERETO DUNLAP UNDERTAKING LITIGATION ADVANCEMENT PROVISION REASONABLENESS CHARGES ARBITRATION MOTION KERSH DEFENDANT AMOUNTS CONTRACTS FINANCE BYLAWS |
gg 4 .*
e
IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
IN AND FOR NEW CASTLE COUNTY
ALBERT J. DUNLAP and RUSSELL A. KERSH, >>
Plaintiffs, >>
V. >) C.A. No. 17048
SUNBEAM CORPORATION, >
a Delaware corporation, >
>
Defendant. >
NOTICE OF MOTION I'
TO: Thomas J. Allingham, II, Esquire
Skadden Arps Slate Meagher & Flom
One Rodney Square
Wilmington, DE 19899
I' ij
PLEASE TAKE NOTICE that the within Motion to Strike'%$fe&&t's~~"'
Affirmative Defenses will be presemed to the Court at the earliest convenience of the Court and
counsel.
POTTER ANDERSON & CORROON LLP
Donald J. Wolfe, Jr.
OF COUNSEL Kevin R. Shannon
Donald S. Zakarin, Esquire Brian C. Ralston
PRYOR CASHMAN SHERMAN & 13 13 North Market Street, Sixth Floor
FLYNN LLP P.O. Box 951
4 10 Park Avenue Wilmington, DE 1980 1
New York, NY 10022-4441 (302) 984-6000
(212) 421-4100
Attorneys for Plaintiffs
Albert J. Dunlap and Russell A. Kersh
Dated: June 3, 1999
373656
IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
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7
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ANSWER TO COMPLAINT
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EXTRACTED KEY WORDS
COMPLAINT PARAGRAPH SUNBEAM DENIES SUNBEAM ADMITS COURT PLAINTIFFS EXHIBIT RELIEF DELAWARE GENERAL CORPORATION DUNLAP KERSH BALANCE GENERAL CORPORATION LAW LITIGATION EXPENSES SUNBEAM RESPECTFULLY REFERS PURSUANT INFORMATION SUFFICIENT TRUTH AFFIRMATIVE DEFENSE RESPONSES THEREOF SUNBEAM REALLEGES INCORPORATES REFERENCE PRECEDING PARAGRAPHS DOCTRINES VICE FOREBEARANCE AGREEMENT |
IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
IN AND FOR NEW CASTLE COUNTY
X
ALBERT J. DUNLAP and RUSSELL A. KERSH, :
Plaintiffs,
V. C.A. No. 17048 ---
*\
SUNBEAM CORPORATION, !
Defendant.
x
ANSWER TO COMPLAINT FOR RELIEF PURSUANT TO
SECTION 145(k) OF THE DELAWARE GENERAL CORPORATION LAW
Defendant Sunbeam Corporation ("Sunbeam"), by and through its
undersigned counsel, submits this answer to the complaint of Albert J. Dunlap
("Dunlap") and Russell A. Kersh ("Kersh") (collectively, the "Plaintiffs") for relief
pursuant to Section 145(k) of the Delaware General Corporation Law (the "Complaint"):
1. Sunbeam admits the allegations contained in paragraph 1 of the
Complaint.
2. Sunbeam admits the allegations contained in paragraph 2 of the
Complaint.
3. Sunbeam admits the allegations contained in paragraph 3 of the
Complaint.
4. Sunbeam admits that the Complaint is purportedly brought
pursuant to Section 145 of the Delaware General Corporation Law, but denies the
balance of the allegations contained in paragraph 4 of the Complaint.
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8
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COMPLAINT
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EXTRACTED KEY WORDS
LITIGATION EXPENSES DUNLAP KERSH OFFICERS DIRECTORS INDEMNIFICATION AGREEMENT INCURRING REQUEST UNDERTAKING PLAINTIFFS OBLIGATIONS LAW LLP DEFENDANTS COURT FEES BYLAWS DETERMINATION ACCORDANCE REASON FOREBEARANCE AGREEMENT RELIEF PROVISIONS REPAY DEL FULLY SET PENDING CONNECTION |
IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
IN AND FOR NEW CASTLE COUNTY
ALBERT J. DUNLAP and RUSSELL A. KERSH, >>
Plaintiffs, >
>
V. >) C.A.No. 1 m .-
SUNBEAM CORPORATION, _,
> - 4
a Delaware corporation, >>
Defendant. >
COMPLAINT FOR RELIEF PURSUANT TO
SECTION 145(k) OF THE DELAWARE GENERAL CORPORATION LAW
Plaintiffs Albert J. Dunlap and Russell A. Kersh, by and through their under-
signed counsel, Potter Anderson & Corroon LLP and Pryor Cashman Sherman & Flynn. LLP,
seek relief for the claims set forth herein, pursuant to Section 145(k) of the Delaware General
Corporation Law,
PARTIES TO THE ACTION
1. Plaintiff Albert J. Dunlap is a former Chief Executive Officer and Chair-
man of the Board of Defendant Sunbeam Corporation. Mr. Dunlap resides in Boca Raton, Flor-
ida.
2. Plaintiff Russell A. Kersh is a former Executive Vice President of Defen-
dant Sunbeam Corporation. Mr. Kersh resides in Boca Raton, Florida.
3. Defendant Sunbeam Corporation ("Sunbeam") is a Delaware corporation
with headquarters located in Boca Raton, Florida.
THE JURISDICTION OF THE COURT OF CHANCERY
4. This action is initiated pursuant to 8 Del. C. 5 145(k), which vests the
Court of Chancery with exclusive jurisdiction to hear and determine all actions for advances of
attorneys' fees, court costs, expert fees, and all other litigation expenses that are recoverable
der the indemnification provisions of 8 Del. C. 5 145 and any other applicable bylaw, agreement,
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