COURT OF CHANCERY
OF THE
SAM GLASSCOCK III
VICE CHANCELLOR
STATE OF DELAWARE COURT OF CHANCERY COURTHOUSE
34 THE CIRCLE
GEORGETOWN, DELAWARE 19947
November 24, 2020
Ned Weinberger, Esquire Kevin G. Abrams, Esquire
Derrick Farrell, Esquire Eric A. Veres, Esquire
Labaton Sucharow LLP Stephen C. Childs, Esquire
300 Delaware Avenue – Suite 1340 Abrams & Bayliss LLP
Wilmington, DE 19801 20 Monthchanin Road, Suite 200
Wilmington, DE 19807
Peter B. Andrews, Esquire Brian C. Ralston, Esquire
Craig J. Springer, Esquire Caneel Radinson-Blasucci, Esquire
David M. Sborz, Esquire Potter Anderson & Corroon LLP
Andrews & Springer LLC Hercules Plaza, 6th Floor
3801 Kennett Pike 1313 North Market Street
Building C, Suite 305 Wilmington, DE 19899
Wilmington, DE 19807
Re: In re Terraform Power, Inc. Stockholders Litigation
C.A. No. 2019-0757-SG
Dear Counsel:
I have the Defendants’ Application for Certification of Interlocutory Appeal
of my Memorandum Opinion of October 30, 2020 (the “Opinion”),1 together with
the Plaintiffs’ Opposition thereto. Because the Opinion was not accompanied by an
order, I have filed a consistent order today and consider the Application for
1
In re Terraform Power, Inc. Stockholders’ Litigation, C.A. No. 2019-0757-SG, Dkt. No. 84.
Certification to be addressed to that Order of November 24, 2020 (the “Order”).
After considering the parties’ submissions, I have concluded that this matter is
appropriate for interlocutory appeal and have attached an order granting leave to
appeal from the Order and Opinion, consistent with Supreme Court Form L.
Supreme Court Rule 42 is a testament to the particularity with which the
Supreme Court considers interlocutory appeals. It is unsurprising that this is so;
interlocutory appeals tend to be inefficient for the Supreme Court, the trial courts
and litigants. It is a rare case in which such an appeal is justified. I find that this is
such a case, however.
I am directed by Rule 42 to consider several factors in addressing whether an
interlocutory appeal is warranted. I first consider 42(b)(3)(iii)(G). 2 That factor
involves whether consideration of the appeal may end the litigation. The Opinion
and Order involved the Defendants’ contention that the matter should be dismissed
because the Plaintiffs lack standing to pursue their Complaint directly rather than
derivatively. The Plaintiffs have standing in this matter, if at all, under the doctrine
set forth in Gentile v. Rosette.3 I will not repeat in this brief Letter Opinion the
reasons for which the application of the Gentile doctrine has been questioned in light
of our Supreme Court’s overarching test for determining whether a stockholder-
2
Supr. Ct. R. 42(b)(iii)(G) (“Review of the Interlocutory Order may terminate the litigation.”).
3
906 A.2d 91 (Del. 2006).
2
plaintiff’s corporate litigation is direct or derivative, as set forth in Tooley v.
Donaldson, Lufkin, & Jenrette, Inc. 4 That discussion is set out in some detail in the
Opinion from which this interlocutory appeal is sought. 5 In consideration of the
instant motion, however, the issue of the continuing validity of the Gentile rationale,
in light of, inter alia, criticism from our Supreme Court, 6 indicates that factor
42(b)(3)(iii)(G)7 is implicated here. I note that the application of subsection (G), by
itself, it is unlikely to be sufficient to sustain an interlocutory appeal. Here, however,
I find that subsection (H) also comes into play. That factor directs me to consider
whether “[r]eview of the interlocutory appeal may serve considerations of justice.” 8
Again, in light of case law questioning the continued vitality of Gentile at the trial
court level, and in light of criticism at the Supreme Court level, I find it in the interest
of justice that the matter be available for review by the Supreme Court at this Motion
to Dismiss stage. A successful interlocutory appeal, before the parties undergo the
extensive litigation that will be required to bring this matter to a final resolution in
this Court, will avoid substantial useless effort on behalf of litigation by parties who
4
845 A.2d 1031 (Del. 2004).
5
See generally Mem. Op., In re Terraform Power, Inc. Stockholders’ Litigation, C.A. No. 2019-
0757-SG, Dkt. No. 84.
6
See El Paso Pipeline GP Co., L.L.C. v. Brinckerhoff, 152 A.3d 1248, 1265–66 (Del. 2016)
(Strine, C.J., concurring).
7
Supr. Ct. R. 42(b)(iii)(G).
8
Supr. Ct. R. 42(b)(iii)(H).
3
lack standing. An unsuccessful appeal will still serve the interests of justice, by
clarifying an area of law that appears to be in a state of flux.
I appreciate the Plaintiffs’ forceful argument that a reliance solely upon the
last two factors of Rule 42(b)(iii) constitutes but a weak ground upon which to certify
interlocutory appeal. To my mind, this is the rare exception that proves that
proposition; of course, if the Supreme Court disagrees, it need only decline to accept
the appeal. I have therefore attached an Order certifying the interlocutory appeal.
To the extent the foregoing requires an order to take effect, IT IS SO
ORDERED.
Sincerely,
/s/Sam Glasscock III
Vice Chancellor
4