By Joseph R. Slights, III, Thomas E. Hanson, Jr., and Elizabeth A. Powers
An installment in the series “Why Delaware: Spotlight on Corporate Law in the First State,” authored by Delaware corporate attorneys and judges. Special thanks to The Delaware Court of Chancery Rules Committee and to the Articles Subcommittee for their contributions.
An ongoing concern for Delaware companies around the world is the time and cost involved in resolving a complex business dispute. Time-critical business transactions frequently languish as local courts work to untangle complicated arguments on already overloaded dockets. Companies are often frustrated by delays and hard hit by discovery costs that can quickly skyrocket if left unchecked.
Several years ago, Delaware’s judiciary recognized the need for an additional venue to provide its corporate citizens with a more flexible and cost-effective solution for litigating disputes claiming monetary damages on a speedy timeline, if needed. The discussion ultimately led to the creation of the Complex Commercial Litigation Division (CCLD) which operates as part of Delaware’s Superior Court. Established in May 2010, the CCLD has become an integral component of Delaware’s highly-regarded court system, providing an alternative venue for complex commercial litigation for disputes where monetary damages are sought. Cases can be heard in a matter of months, when appropriate, and motions can be scheduled within a few days.
The CCLD is unique in its ability to provide both the parties in the dispute, and the Court, greater flexibility in scheduling and case management by allowing the parties to craft speedy timelines for discovery, motion practice, and trial that suit the specific needs of the case. Parties receive firm pretrial and trial dates, and know that these dates will not be changed due to scheduling conflicts with the judge’s other civil cases.
Another important advantage is that the four judges of the CCLD are well-versed in complex commercial litigation. CCLD judges have strong business law backgrounds or proven records of managing complex civil litigation and deciding complicated business disputes.
Plaintiffs interested in efficient resolution of business disputes can file their claim in the CCLD. Once a case is designated to the CCLD, the case remains with the assigned judge until it is resolved, giving parties greater predictability and consistency in decision-making. Parties may also use the CCLD’s mediation and arbitration proceedings, where CCLD judges serve as mediators for cases to which they are not assigned as the trial judge.
Not all business disputes are eligible for assignment to the CCLD. In order to qualify, the case must either involve a commercial claim where the amount is at least one million dollars; involve an exclusive choice of court agreement (also referred to as forum selection clause); or receive special assignment by the President Judge of the Superior Court. Certain cases are ineligible for the CCLD, including claims for personal and physical injury, mortgage foreclosure, and mechanics’ liens.
Case Management Orders
CCLD cases are governed by a Case Management Order, which establishes deadlines and provides a framework for the orderly completion of all case tasks. The Case Management Order covers all phases of litigation, including a cut-off date for discovery and dispositive motions and a firm trial date.
The Case Management Order sets forth a specific protocol for expert discovery in order to standardize the scope and production of such discovery, thereby offering litigants a greater degree of certainty and predictability as to how discovery will proceed. The Expert Discovery Protocol establishes firm dates for the identification and disclosure of expert witnesses and sets dates for expert witness depositions. The Protocol explicitly mandates each party to pay its testifying experts’ fees and expenses that are incurred in connection with the depositions.
Business litigants struggle to strike an appropriate balance between conducting necessary e-discovery and covering the significant expense such discovery often entails. Parties often have to consider whether the likelihood of prevailing, and the likely amount of recovery, justify the cost and uncertainty of embarking on the e-discovery process.
To address these concerns, the CCLD’s E-Discovery Plan Guidelines require litigants to hold a “meet-and-confer” session early in the litigation to discuss discovery of electronically stored information (ESI) before e-discovery orders are entered. The Guidelines provide a list of factors to be discussed at the session, including: the form in which ESI will be produced; the scope of production; and how the parties will share the costs of preservation and production of ESI.
After the meet and confer session, the parties submit a report summarizing their proposed e-discovery plan to the Superior Court and state their position on unresolved issues. The Superior Court reviews the report and enters an order governing the permissible scope of discovery of ESI.
By permitting the parties to drive the e-discovery process, the E-Discovery Plan Guidelines afford business litigants the opportunity to build on what works and to eliminate what does not. Of course, if the parties cannot agree, the judges of the CCLD are experienced in resolving e-discovery disputes, with a focus on ensuring that the scope of e-discovery matches the size and nature of the controversy.
Joseph R. Slights, III and Thomas E. Hanson Jr. are partners, and Elizabeth A. Powers is an associate, in the business and corporate litigation department of Morris James LLP. From 2000 to 2012, Mr. Slights served as a Judge of the Superior Court of Delaware, where he presided over cases assigned to the Complex Commercial Litigation Division from the time of its inception to the time of his retirement from the Bench. The views expressed in this article are solely those of the authors and are not necessarily shared by Morris James LLP or its clients.