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1
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OPINION (REVISED)
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EXTRACTED KEY WORDS
AGREEMENT PLAINTIFF-CORPORATION ESQUIRE LEASE CONCENTRATION ACCOUNT COURT BUILDING LEASE COMPLAINT DEL CASTLE HILL BREACH BANGOR PUNTA DOCTRINE DEFENDANTS CNL ALLEGE PARTNERSHIP COMMON LAW MOTION FIDUCIARY DUTIES LEEDS DISMISSING SUPR REA VICE CHANCELLOR DELAWARE LLC PAY CREDITORS |
Pages 7,13,17,21, and 29 have beerz
IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
IN AND FOR NEW CASTLE COUNTY
MIDLAND FOOD SERVICES, LLC,
MIDLAND FOOD SERVICES II, LLC,
and MIDLAND FOOD SERVICES III, LLC, >>
Plaintiffs, >> Civil Action No. 16779 '
V. >>
CASTLE HILL HOLDINGS V, LLC, 1
CASTLE HILL HOLDINGS VI, LLC, )
CASTLE HILL HOLDINGS VII, LLC,
RONALD F. SAVERIN, KEY ; c -1
TRUST COMPANY OF OHIO, NA, > i 1%
JANET M. SAVERIN, MAJESS, LLC, >
and DAJUST, LLC, >
Defendants, >>
V. >>
AL HUT, INC., a Delaware corporation, >>
Counterclaim Defendant. >
OPINION
Date Submitted: July 8, 1999
Date Decided: July 16, 1999
Date Revised: August 12, 1999
David J. Ferry, Jr., Esquire, of FERRY & JOSEPH, Wilmington, DE; OF COUNSEL:
Gary M. Schildhom, Esquire, Douglas N. Candeub, Esquire, of ADELMAN LAVINE
GOLD AND LEVIN, Philadelphia, PA, Attorneys for Plaintiffs.
Edward P. Welch, Esquire, Randolph K. Herndon, Esquire, Laura S. Clare, Esquire, of
SKADDEN, ARPS, SLATE, MEAGHER & FLOM, Wilmington, DE; OF COUNSEL:
Richard R. Kalikow, Esquire, Esther S. Trakinski, Esquire, of SKADDEN, ARPS, SLATE,
MEAGHER & FLOM, New York, New York, Attorneys for Defendants.
STFUNE, Vice Chancellor
Loans"). Id. lq 40-43. Pursuant to the Enterprise Loans, CSFB and other
lenders hold liens on the non-real estate assets of a Midland Company. Id. 1
44. Integral, apparently, to this financing was $71,400,000 worth of
financing provided by CSFB's assignee, Franchise Mortgage Acceptance
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2
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LETTER OPINION
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EXTRACTED KEY WORDS
COUNTERCLAIMS OHIO MIDLAND COURT LITIGATION PARTIES JURISDICTION LAW CNL EXERCISE DISMISS MIDLAND FOOD SERVICES CASTLE HILLS HOLDINGS MEMORANDUM OPINION FORUM DELAWARE PROCEEDS MOTION RESOLVE PRESENCE COUNTERCLAIMS RAISE CONTRACT MERITS CHANCERY COURT EVIDENCE SUPERIOR COURT CONTEST CHOSE PREFERENCE |
C O U R T O F C H A N C E R Y
OF THE
S T A T E O F D E L A W A R E
LEO E. STRINE, J R. COURT H OUSE
"ICE-CHANCELLOR WILMINGTON , D ELAWARE
August 10, 1999
David J. Ferry, Jr.
Rick S. Miller
Ferry & Joseph
824 Market Street, Suite 904
Wilmington, DE 19899
Edward P. Welch
Randolph K. Herndon
Laura S. Clare
Skadden, Arps, Slate, Meagher & Flom
One Rodney Square
P.O. Box 636
Wilmington, DE 19899
Re: Midland Food Services v. Castle Hills Holdings,
C.A. No. 16779
Dear Counsel:
In a memorandum opinion (the "Memorandum Opinion") issued on
July 16, 1999, I found that the plaintiffs in this action, the Midland
Companies (as defined in that opinion), were barred from suing the
defendants under the Bangor Punta Doctrine. In this letter opinion, I
address the motion filed by the Midland Companies to dismiss the
counterclaims (the "Counterclaims") brought by the Castle Hill Companies
(as defined in the Memorandum Opinion).
Midland Food Services v. Castle Hills Holdings
August 10, 1999
Page 2
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3
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ORDER
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EXTRACTED KEY WORDS
CASTLE HILL CASTLE HILL HOLDINGS SAVERIN DEFENDANTS MIDLAND FOOD SERVICES MOTIONS DELAWARE PLAINTIFFS HILL HOLDINGS VII RONALD JANET MAJESS DAJUST DISMISS AMENDED COMPLAINT COURT CHANCERY CASTLE COUNTY TRUST COMPANY OHIO HUT DELAWARE CORPORATION COUNTERCLAIM DEFENDANT FIRST AMENDED COMPLAINT PREJUDICE PLA THIRD AMENDED COMPLAINT JUDGEMENT |
IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
IN AND FOR NEW CASTLE COUNTY
MIDLAND FOOD SERVICES, LLC,
MIDLAND FOOD SERVICES II, LLC,
and MIDLAND FOOD SERVICES III,
LLC
Plaintiffs,
V. Civil A'ction No. 16779NC
CASTLE HILL HOLDINGS V, LLC,
CASTLE HILL HOLDINGS VI, LLC,
CASTLE HILL HOLDINGS VII, LLC,
RONALD F. :SAVERIN, KEY
TRUST COMPANY OF OHIO, NA,
JANET M. SAVERIN, MAJESS, LLC
AND DAJUST, LLC,
Defendants,
V.
AL HUT, INC., a Delaware corporation,
Counterclaim Defendant.
ORDER
Upon consideration of the motions to dismiss filed by Castle Hill
Holdings V, LLC, Castle Hill Holdings VI, LLC, Castle Hill Holdings VII, LLC,
Ronald F. Saverin, Janet M. Saverin, Majess, LLC and Dajust, LLC (collectively, the
"Castle Hill Defendants"),
IT IS HEREBY ORDERED this<$/J.5+ --`TY / ;,./! 19'39 that
(lay of L..d 1 I"
-1" '
motions are granted. It is further ordered that:
(9 the First Amended Complaint is dismissed with prejudice;
(ii) the pla t ff
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4
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LETTER TO V.C. STRINE
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EXTRACTED KEY WORDS
LAW CASTLE HILL COMPANIES CASTLE HILL LEASES COUNTERCLAIMS AGREEMENT DEL MIDLAND COMPANIES BREACH SIGNIFICANT RELATIONSHIP STRINE TORTIOUS INTERFERENCE CASTLE HILL VII DELAWARE HONORABLE LEO CHANCELLOR COURT WILMINGTON TRUST FIRST AMENDED COUNTERCLAIMS MOTION CONTRACT RESOLVE CONCENTRATION ACCOUNT AGREEMENT SUPR SLIP BUSINESS COMPL SEEKING DEFENDANTS |
S K A D D E N , A R P S , S L A T E , M E A G H E R & F L O M LLP.
O N E R O D N E Y S Q U A R E
P.0 BOX 6 3 6
W I L M I N G T O N , D E L - A W A R E 1 9 8 9 9 - 0 6 3 6
LOS
TEL (302) 651-3000 NEW
PP.LO
FAX. (302) 651-3 0 0 I SAN
B R U
F R A
HONG
L O
M O
S I N
S Y
July 19, 1999
T O R
BYHAND
The Honorable Leo E. Strine, Jr.
Vice Chancellor
Court of Chancery
Daniel L. Herrmann Courthouse
1020 King Street
Wilmington, DE 19801
Re: Midland Food Services, LLC, et al. v. Castle Hill
Holdings. V, LLC, et al., C.A. No. 16779NC
Dear Vice Chancellor Strine:
I have enclosed a copy of the Castle Hill Companies' First Amended
Counterclaims, the original of which was filed with the Register in Chancery today.
We do not believe that a motion for leave to file the First Amended Counterclaims is
required, since Plaintiffs have not yet filed their answer to these counterclaims. See
Ch. Ct. R. 15(a).
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5
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SUPPLEMENTAL MEMORANDUM OF PLAINTIFFS IN OPPOSITION TO MOTOIN TO DISMISS COMPLAINT & IN SUPPORT OF MOTION TO DISMISS COUNTERCLAIM
|
EXTRACTED KEY WORDS
CASTLE HILL PLAINTIFFS COUNTERCLAIM LAW LLC SAVERIN CONTRACT VII OHIO MOTION COMPLAINT MIDLAND COMPANIES LEASE AGREEMENTS CASTLE HILL HOLDINGS DEFENDANTS DISMISS MIDLAND FOOD SERVICES SUPPLEMENTAL MEMORANDUM RESTATEMENT PRINCIPLES RESTAURANT LEASE AGREEMENT CONFLICTS ANTICIPATORY BREACH SIGNIFICANT RELATIONSHIP REFORMATION TRANSACTION APF OPPOSITION ACCORDANCE |
ORlGlNAL
IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE i' -'
IN AND FOR NEW CASTLE COUNTY
MIDLAND FOOD SERVICES, LLC, CIVIL ACTION
MIDLAND FOOD SERVICES II, LLC, and
MIDLAND FOOD SERVICES III, LLC,
Plaintiffs,
C.A. No. 16779 NC
V.
CASTLE HILL HOLDINGS V, LLC,
CASTLE HILL HOLDINGS VI, LLC,
CA;STLE HILL HOLDINGS VII, LLC,
RONALD F. SAVERIN,
KEY TRUST COMPANY OF OHIO, NA, :
JANET M. SAVERIN,
MAJESS, LLC, DAJUST, LLC, and
CNI; AMERICAN PROPERTIES
FUND, INC., APF I PROPERTIES,
API: II PROPERTIES, and APF III PROPERTIES, :
Defendants.
SUPPLEMENTAL MEMORANDUM OF PLAINTIFFS
IN OPPOSITION TO MOTION TO DISMISS COMPLAINT
AND IN SUPPORT OF MOTION TO DISMISS COUNTERCLAIM
- -
Plaintiffs Midland Food Services, LLC, Midland Food Services II, and Midland
Food Services III, LLC (collectively, "Plaintiffs" or the "Midland Companies"j hereby
submit this Supplemental Memorandum with respect to the Motion to Dismiss the
Conplaint, tiled by Castle Hill Holdings V, LLC, Castle Hill Holdings VI, LLC, and
Castle Hill Holdings VII, LLC (collectively, the "Castle Hill Defendants") and the Motion
to D:.smiss the Counterclaim, in accordance with the directive of this Court at the hearing
on tke two motions that was held on July 8, 1999.
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6
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FIRST AMENDED COUNTERCLAIMS
|
EXTRACTED KEY WORDS
CASTLE HILL VII LEASE AGREEMENT HUT CNL LLC COUNTERCLAIM PLAINTIFF CASTLE MIDLAND COMPANIES LIMITED LIABILITY COMPANY DELAWARE COURT CASTLE HILL HOLDINGS OHIO COUNTERCLAIM DEFENDANT LAWS ATTORNEYS TRUST COMPANY OBLIGATIONS MORTGAGES CONCENTRATION ACCOUNT AGREEMENT MIDLAND FOOD SERVICES GROUND LEASES LEASED PREMISES CNL NOTES MATERIAL BREACHES FIRST AMENDED COUNTERCLAIMS PROPERTY-RELATED EXPENSES REAL ESTATE TAXES ENFORCEABILITY |
IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
IN AND FOR NEW CASTLE COUNTY
MIDLAND FOOD SERVICES, LLC,
MIDLAND FOOD SERVICES II, LLC,
;and MIDLAND FOOD SERVICES III,
:LLc
Plaintiffs,
V. : Civil Action No. 16779NC
CASTLE HILL HOLDINGS V, LLC,
(CASTLE HILL HOLDINGS VI, LLC,
(CASTLE HILL HOLDINGS VII, LLC,
RONALD F. SAVERIN, KEY
`TRUST COMPANY OF OHIO, NA,
MAJESS, LLC AND DAJUST, LLC,
Defendants,
V.
AL HUT, INC., a Delaware corporation,
Counterclaim Defendant.
FIRST AMENDED COUNTERCLAIMS
Counterclaim plaintiffs Castle Hill Holdings V, LLC ("Castle Hill
V"), Castle Hill Holdings VI, LLC ("Castle Hill VI") and Castle Hill Holdings VII,
LLC ("Castle Hill VII"), by their attorneys, Skadden, Arps, Slate, Meagher & Flom,
LLP, allege upon knowledge with respect to themselves and their acts and upon
information and belief as to all other matters, as follows:
PARTIES
1. Counterclaim plaintiff Castle Hill V is a limited liability company
organized under the laws of the State of Delaware, with its principal place of
business at 400 South Woods Mill Road, Suite 120, Chesterfield, Missouri 63017.
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7
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MEMORANDUM OPINION
|
EXTRACTED KEY WORDS
CASTLE HILL SAVERIN HUT DEFENDANTS PLAINTIFFS COURT RESOLUTION AGREEMENT LLC LEASES COMPLAINT DELAWARE BANGOR PUNTA DOCTRINE RONALD SAVERIN BANGOR PUNTA MAJESS OWNERSHIP CSFB FMAC CNL BUILDING LEASES CREDITORS PIZZA HUT CONCENTRATION ACCOUNT CASTLE HILL HOLDINGS AMENDED COMPLAINT TRANSACTIONS THIRD AMENDED COMPLAINT CHANCERY COURT RULE COURTLAND MANOR |
IN THE COURT OF CHANCERY OF THE STATE OF DELAW~
IN AND FOR NEW CASTLE COUNTY
MIDLAND FOOD SERVICES, LLC, >
MIDLAND FOOD SERVICES II, LLC, 1
and MIDLAND FOOD SERVICES III, LLC, 1
Plaintiffs, ,'> Civil Action No. 16779
V.
;
CASTLE HILL HOLDINGS V, LLC, >
CASTLE HILL HOLDINGS VI, LLC,
CASTLE HILL HOLDINGS VII, LLC, t
RONALD F. SAVERIN, KEY >
TRUST COMPANY OF OHIO, NA,
JANET M. SAVERIN, MAJESS, LLC,
and DAJUST, LLC, A,
Defendants, ."
,. :
_ ,
.
V.
AL, HUT, lNC., a Delaware corporation,
Counterclaim Defendant.
MEMORANDUM OPINION
Date Submitted: July 8, 1999
Date Decided: July 16, 1999
David J. Ferry, Jr., Esquire, of FERRY & JOSEPH, Wilmington, DE; OF COUNSEL:
Gary M. Schildhorn, Esquire, Douglas N. Candeub, Esquire, `of ADELMAN LAVINE
GOLD AND LEVIN, Philadelphia, PA, Attorneys for Plaintiffs.
Edward P. Welch, Esquire, Randolph IS. Herndon, Esquire, Laura S. Clare, Esquire, of
SKADDEN, ARPS, SLATE, MEAGHER & FLOM, Wihnington, DE; OF COUNSEL:
Richard R. Kalikow, Esquire, Esther S. Trakinski, Esquire, of SKADDEN, ARPS, SLATE,
MEAGHER & FLOM, New York, New York, Attorneys for Defendants.
STRINE, Vice Chancellor
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8
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LETTER TO V.C. STRINE
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EXTRACTED KEY WORDS
COMPLAINT MOTION DEL AMENDED COMPLAINT AGREEMENT FIRST AMENDED COMPLAINT THIRD AMENDED COMPLAINT REASONS AMEND PARTIES CNL COURT DEFENDANTS EXHIBIT DISMISS STRINE CHANCELLOR FUTILE AMENDMENT SLIP CONCENTRATION ACCOUNT FAILS PARTY LEASES CONTRACT CSFB HONORABLE LEO PROPOSED AMENDMENT SUPR |
SKADDEN, A RPS , S LATE , MEAGHER & F LOM LLP
O N E R O D N E Y S Q U A R E
P.O. B O X 6 3 6
W I L M I N G T O N , D E L A W A R E 1 9 8 9 9 - 0 6 3 6
T E L : (302) 651-30(X)
FAX: (302) 651-300 I S
W A
June 30. 1999
BY HAND
The Honorable Leo E. Strine. Jr
Vice Chancellor
Court of Chancery
1020 King Street
Wilmington, DE 19801
Re: Midland Food Services, LLC, et al. v. Castle Hill
Holdings, V, LLC, e_t-.d., C.A. No. 16779NC
Dear Vice Chancellor Strine:
Over a month after Defendants filed their opening brief in support of their
Motion to Disrniss Plaintiffs' First Amended Complaint, Plaintiffs requested leave to file
a Third Amended Complaint in a futile attempt to cure the deficiencies in their First
Amended Complaint. ' For the reasons explained below, Plaintiffs' Motion for Leave to
File a Third Amended Complaint (the "Motion to Amend") should be denied
Under well-settled Delaware law, "[a] court should deny leave to amend a
complaint when the amendment would be futile due to the insufficiency of the proposed
amendment, " Glaser v Norris, Del. Ch., C.A. No. 9538, slip op. at 30, Chandler, V C.
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9
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REPLY MEMORANDUM OF THE COUNTERCLAIM DEFENDANTS IN SUPPORT OF MOTION TO DISMISS COUNTERCLAIMS
|
EXTRACTED KEY WORDS
DEFENDANTS COURT CONCENTRATION ACCOUNT AGREEMENT THIRD PARTY COUNTERCLAIM THIRD PARTY BENEFICIARIES BREACH CNL DISMISS COMPLAINT MOTION DECLARATORY RELIEF LLC HUT MOVANTS JURISDICTION VII CONTENTION RESOLUTION AGREEMENT CASTLE HILL HOLDINGS CNL AMERICAN APF ASSERTING BREACH MIDLAND COMPANIES PLAINTIFFS COURT GRANTS KEY TRUST CREDITOR BENEFICIARIES CASTLE HILL COMPANY |
IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
IN AND FOR NEW CASTLE COUNTY
MIDLAND FOOD SERVICES, LLC, CIVIL ACTION : , ,~)
MIDLAND FOOD SERVICES II, LLC, and : ~l!,~~ :
..,,>'
MIDLAND FOOD SERVICES III, LLC, :.,,. I .-
Plaintiffs, C-A. No. 16779 NC;-;:`. ' I:
V. -I---
: * . -37
/I:. -1
.-
CASTLE HILL HOLDINGS V, LLC, - "
L)
CASTLE HILL HOLDINGS VI, LLC,
CASTLE HILL HOLDINGS VII, LLC,
RONALD F. SAVERIN,
KEY TRUST COMPANY OF OHIO, NA, ;
JANET M. SAVERIN,
MAJESS, LLC, DAJUST, LLC, and
CNL AMERICAN PROPERTIES
FUND, INC., APF I PROPERTIES,
APF II PROPERTIES, and APF III PROPERTIES, i
Defendants,
V.
AL HUT, INC.,
Third Party Defendant. :
REPLY MEMORANDUM OF THE COUNTERCLAIM DEFENDANTS
IN SUPPORT OF THEIR MOTION TO DISMISS COUNTERCLAIMS
OF THE CASTLE HILL COMPANY DEFENDANTS
David J. Ferry, Jr., Esquire
Rick S. Miller, Esquire
FERRY & JOSEPH, P.A.
824 Market Street, Suite 904
Wilmington, DE 19899
- and -
Gary M. Schildhorn, Esquire
Douglas N. Candeub, Esquire
ADELMAN LAVINE GOLD AND LEVIN,
A Professional Corporation
Two Penn Center Plaza, Suite 1900
Philadelphia, PA 19 102
Dated: June 3, 1999 Attornevs for Plaintiffs and Third Partv Defendant
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10
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COUNTERCLAIM PLAINTIFFS BRIEF IN OPPOSITION TO MOTION TO DISMISS COUNTERCLAIMS
|
EXTRACTED KEY WORDS
CASTLE HILL COMPANIES COUNTERCLAIMS MIDLAND AGREEMENT PLAINTIFFS RESTAURANT LEASES COURT VII HUT CONTRACT DEFENDANTS BREACH PARTIES CNL INDISPENSABLE PARTIES VIII THIRD-PARTY BENEFICIARIES LLC CONCENTRATION ACCOUNT AGREEMENT CASTLE HILL HOLDINGS TRUST COMPANY REFORMATION TORTIOUS INTERFERENCE COMPLAINT JURISDICTION MIDLAND FOOD SERVICES PLAINTIFFS ARGUE AFRICAN UNION FIRST HILL COMPANIES ALLEGE |
IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
IN AND FOR NEW CASTLE COUNTY
MIDLAND FOOD SERVICES, LLC,
MIDLAND FOOD SERVICES II, LLC
and MIDLAND FOOD SERVICES III,
LLC,
Plaintiffs,
V. : Civil Action No. 16779NC i` ' .
CASTLE HILL HOLDINGS V, LLC,
CASTLE HILL HOLDINGS VI, LLC,
CASTLE HILL HOLDINGS VII, LLC,
RONALD F. SAVERIN, KEY
TRUST COMPANY OF OHIO, NA,
JANET M. SAVERIN, MAJESS, LLC
AND DAJUST, LLC,
Defendants,
V.
AL HUT, INC., a Delaware corporation,
Counterclaim Defendant.
COUNTERCLAIM PLAINTIFFS' BRIEF
IN OPPOSITION TO COUNTERCLAIM DEFENDANTS'
MOTION TO DISMISS COUNTERCLAIMS
SKADDEN, ARPS, SLATE, MEAGHER
& FLOM LLP
One Rodney Square
P.O. Box 636
Wilmington, Delaware 19899
(302) 65 l-3000
Attorneys for Defendants
DATED: May 6, 1999
TABLE OF CONTENTS
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