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Plaintiff filed this action against defendants claiming that defendants breached a limited partnership agreement under which another limited partnership was formed to seek out, acquire, and develop oil and gas producing properties through the use of three-dimensional seismic technology. At issue was whether the Court of Chancery abused its discretion in dismissing plaintiff's amended complaint for failure to prosecute. Plaintiff contended, that notwithstanding more than two years of inactivity, it established good cause for its failure to prosecute - change of counsel and settlement negotiations. The trial court found that plaintiff's showing was insufficient to overcome the long delay and the court found no abuse of discretion. Accordingly, the court affirmed the judgment.Receive FREE Daily Opinion Summaries by Email
IN THE SUPREME COURT OF THE STATE OF DELAWARE
SHELDON H. SOLOW,
ASPECT RESOURCES, LLC,
ASPECT ENERGY, LLC,
ASPECT MANAGEMENT CORP.,
And ALEX M. CRANBERG,
§ No. 484, 2011
§ Court Below § Court of Chancery
§ of the State of Delaware
§ C.A. No. 20397-CS
Submitted: January 25, 2012
Decided: March 16, 2012
Before BERGER, JACOBS and RIDGELY, Justices.
Upon appeal from the Superior Court. AFFIRMED.
R. Karl Hill, Esquire and Patricia P. McGonigle, Esquire, Seitz, Van Ogtrop & Green,
P.A., Wilmington, Delaware. Of Counsel: Ira Lee Sorkin, Esquire, Donald A.
Corbett, Esquire (argued) and Daniel K. Roque, Esquire, Lowenstein Sandler PC,
New York, New York for Appellants.
Jon E. Abramczyk, Esquire (argued) and Matthew R. Clark, Esquire, Morris, Nichols,
Arsht & Tunnell LLP, Wilmington, Delaware for Appellees.
In this appeal we consider whether the Court of Chancery abused its discretion
in dismissing Appellant’s amended complaint for failure to prosecute. Appellant
contends that, notwithstanding more than two years of inactivity, it established good
cause for its failure to prosecute – change of counsel and settlement negotiations.
The trial court found that Appellant’s showing was insufficient to overcome the long
delay. We find no abuse of discretion, and affirm.
Factual and Procedural Background
In June 2003, Sheldon H. Solow filed this action against Aspect Resources,
LLC and related parties. Solow claims that Aspect breached a limited partnership
agreement under which another limited partnership was formed to seek out, acquire
and develop oil and gas producing properties through the use of three-dimensional
seismic technology. After the trial court dismissed several of Solow’s claims, he
amended his complaint in February 2004. Aspect again moved to dismiss and for
summary judgment. In October 2004, the court granted the motion to dismiss but
denied the motion for summary judgment.
Solow filed document requests in December 2004, but took no further action
for the next 21 months. He resumed litigation in October 2006. During the period
from October 2006 through July 2008, Solow filed requests for discovery, took and
defended a few depositions, and filed a second amended complaint. Thereafter,
Solow took no action to pursue his claims. During this period of inactivity, Solow’s
New York and local counsel withdrew from representing him. By letter dated
March 13, 2009, Solow advised the court that he was appearing pro se until he
retained new counsel. There were no docket entries in this case from April 2009 until
On January 11, 2011, the trial court sent a status letter to former counsel
advising that there was no activity for more than one year, and that the court might
dismiss the case without further notice under Chancery Court Rule 41 (e). No party
responded to the court’s status letter, and the case was dismissed on March 9, 2011.
Four months later, Solow’s former counsel advised the court that Solow did not
receive the January status letter until recently. Former counsel requested that the
order of dismissal be vacated and that Solow be given 20 days to submit a case
management order to govern future proceedings.
The court gave Solow until August 1, 2011, to move to vacate the order.
Shortly before the due date, new counsel appeared on behalf of Solow, and his motion
to vacate was timely filed. In it, Solow argued that the “good reason” for his inaction
was that he was actively seeking new counsel and that he was engaged in substantive
settlement negotiations. Opposing counsel described the settlement discussions as
“wholly conceptual,” and added that the parties never discussed a stay. The trial
court decided that Solow did not establish good cause for his inaction. By letter dated
August 11, 2011, the court dismissed this case for failure to prosecute. This appeal
Delaware trial courts have inherent power to control their dockets.1 Consistent
with that power, Court of Chancery Rule 41(e) provides for involuntary dismissal of
cases where there has been no action for one year:
Rule 41(e) Inaction for 1 year; dismissal. [I]n each cause pending
wherein no action has been taken for a period of 1 year, the Court may
upon application of any party, or on its own motion, and after reasonable
notice, enter an order dismissing such cause unless good reason for the
inaction is given . . . .
In deciding what constitutes “good reason” the court should balance the reasons for,
and length of the delay, against the policy in favor of deciding cases on the merits.2
This Court reviews the trial court’s decision for abuse of discretion, which has been
explained as follows:
Judicial discretion is the exercise of judgment directed by conscience
and reason, and when a court has not exceeded the bounds of reason in
view of the circumstances and has not so ignored recognized rules of
Coleman v. PricewaterhouseCoopers, LLP, 902 A.2d 1102, 1107 (Del. 2006).
Draper v. Medical Center of Delaware, 767 A.2d 796, 798 (Del. 2001).
law or practice so as to produce injustice, its legal discretion has not
In this case, Solow took no action for more than two years. His explanation for
the delay is that he was looking for new counsel and engaged in settlement
negotiations. In his affidavit, Solow’s General Counsel acknowledged that he and
Solow were looking for new counsel for more than a year. But there is nothing to
suggest why such a long search was necessary. As for the settlement discussions,
Aspect describes them as “conceptual” and makes the point that there were never any
discussions about staying the litigation. In sum, it has been almost 9 years since
Solow filed suit, and for the past 2 years he allowed his claims to languish. The Court
of Chancery did not abuse its discretion in dismissing the case for failure to
Based on the foregoing, the judgment of the Court of Chancery is AFFIRMED.
Firestone Tire and Rubber Co. v. Adams, 541 A.2d 567, 570 (Del. 1988).