IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
ALEJANDRO MENDOZA,
Plaintiff,
v. C.A. No. 2026-0580-CDW
DISTRIBUTED CREATION,
INC.,
Defendant.
POSTTRIAL ORDER GRANTING PARTIAL
INSPECTION OF BOOKS AND RECORDS 1
WHEREAS:
A. Defendant Distributed Creation, Inc. (d/b/a Splice) (“Company”) is a privately held Delaware corporation with its principal place
of business in New York City. 2 The Company operates a music creation
platform giving creators access to a royalty-free sample library and AI
tools to assist in idea generation. 3
1 This case was tried on a paper record without oral argument at the parties’
agreement. See Dkts. 29, 30. Plaintiff’s exhibits are attached to the Declaration of Alejandro Mendoza in Support of Plaintiff’s Opening Pre-Trial Brief, Dkt. 16 (Exhibits 1–5) and the Supplemental Declaration of Alejandro Mendoza in Support of Plaintiff’s Reply Pre-Trial Brief, Dkt. 27 (Exhibits 6–7). They are cited as “Pl.’s Ex.” Defendant’s exhibits are attached to the Transmittal Affidavit of Clayton B. Faller, Esquire in Support of Defendant’s Answering Pre-Trial Brief, Dkt. 21, and are cited as “Def.’s Ex.” The facts herein were proven by a preponderance of the evidence.
2 Verified Compl. for Inspection of Books & Records Pursuant to 8 Del. C. § 220
¶ 5, Dkt. 1 (“Complaint” and cited as “Compl.”); Def.’s Answer to Verified Compl. for Inspection of Books & Records Pursuant to 8 Del. C. § 220 ¶ 5, Dkt. 14 (“Answer”).
3 Def.’s Answering Pre-Trial Br. 2, Dkt. 19 (“Answering Br.”).
B. Plaintiff Alejandro Mendoza is a stockholder of the Company. 4 He holds 10,976 shares of common stock, representing approximately 0.02013% of the Company’s issued and outstanding shares. 5
C. In April 2025, the Company acquired a significant stake in
Spitfire Audio; the transaction was publicly announced on April 28. 6
Around the time of the acquisition, the Company issued additional equity and secured a venture debt facility to help finance the transaction
(collectively, the “April 2025 Deals”). 7
D. In September 2025, plaintiff emailed the Company requesting “financial statements for the period from Q3 2024 to Q3 2025,”
purportedly exercising his rights under Section 220 of the Delaware
General Corporation Law, 8 and asking whether anyone was selling the
Company’s shares that he could buy. 9 Plaintiff also alleged his purpose
was to evaluate the financial performance and condition of the Company. 10
E. Plaintiff signed a confidentiality agreement on February
27, 2026 and the Company produced the requested financial
4 Compl. ¶ 4; Answer ¶ 4.
5 Compl. ¶¶ 1, 4; Answer ¶¶ 1, 4.
6 Answering Br. 2.
7 Id.
8 8 Del. C. §§ 101–398.
9 Def.’s Ex. 9 at 9–10.
10 Id. at 9.
-2-documents. 11 After the production, plaintiff asserted the materials were
incomplete. 12 He contended he received only executive summary financial statements for July 2024 through September 2025 and the production did not include the most recent financial statement. 13
F. After reviewing monthly cash flow, balance sheet, and
profit-and-loss metrics from July 2024 through September 2025, plaintiff questioned the Company’s April 2025 acquisition of Spitfire Audio. 14
He identified the following: (1) a $53 million transaction in April 2025
involving approximately $45 million in intangible asset purchases and
$8 million in capitalized content, reportedly related to the acquisition of
Spitfire Audio; (2) $25 million in new venture debt at an annualized interest rate around 13%; (3) approximately $18 million in new equity issuances; (4) cumulative net losses of approximately $9.9 million over the
15-month period ending September 2025; and (5) monthly net losses escalating to $1.1 million to $1.8 million from March 2025 onward. 15
G. On March 16, 2026, plaintiff served a formal, written demand on the Company under Section 220 (“Demand”). 16 The Demand
11 Pl.’s Opening Pre-Trial Br. 6–7, Dkt. 16 (“Opening Br.”).
12 Compl. ¶ 9.
13 Id. ¶ 7.
14 Id.; Answer ¶ 7.
15 Compl. ¶ 9; Answer ¶ 9.
16 Def.’s Ex. 10; see also Compl. ¶ 2; Answer ¶ 2.
-3-asserts five purposes and identifies eight categories of books and records
sought. 17
H. Plaintiff asserts five purposes in the Demand: (1) valuing
his stock; (2) investigating potential mismanagement; (3) investigating
related-party transactions; (4) determining the dilutive effect of the
April 2025 equity issuance; and (5) assessing the Company’s current financial condition. 18 He seeks eight categories of documents to fulfill
those purposes:
Category 1: Current financial statements encompassing Q4 2025 and Q1 2026.
Category 2: A complete balance sheet as of
September 30, 2025.
Category 3: All board minutes, written consents, resolutions, and board packages relating to the April 2025 acquisition.
Category 4: Documentation, including the executed loan agreement, term sheet, and all
material amendments, relating to the $25
million venture debt facility raised in April
2025.
Category 5: The current capitalization table
and historical capitalization tables dating
back to January 1, 2024.
Category 6: Any third-party valuation, 409A
valuation, fairness opinion, or board-approved valuation of the Company conducted
since January 1, 2024.
17 Demand 2–3.
18 Id.
-4-Category 7: All related-party transaction disclosures.
Category 8: All board resolutions, subscription agreements, and closing documents relating to equity issuances since January 1, 2024,
including the April 2025 equity raise of approximately $18 million, identifying all investors, price per share, and ownership percentages. 19
I. The Company refused the Demand on March 23 and declined to produce any books or records. 20 The Company contended plaintiff failed to state a proper purpose and the Demand was overbroad because it sought documents not essential to plaintiff’s stated purposes. 21
The Company offered to produce its 2025 full-year monthly financial
statements and a stockholder list, conditioned on plaintiff signing a confidentiality agreement and agreeing to dismiss this action. 22 Plaintiff
declined. 23
19 Id. at 3–4.
20 Compl. ¶ 3; Def.’s Ex. 8.
21 Def.’s Ex. 8.
22 Def.’s Ex. 11.
23 Id.
-5-J. On May 8, plaintiff filed the Complaint. 24 The Company
answered on June 5. 25 The parties agreed to forgo discovery, 26 and between June 30 and July 24, the parties filed their pretrial briefs. 27
K. On July 16, while pretrial briefing was underway, the Company again offered to provide certain information while narrowing the
issues in dispute, proposing to produce its stockholder list and 2025 financial statements subject only to a confidentiality agreement. 28 Plaintiff agreed, and the Company produced the 2025 monthly financial statements and stockholder list on July 23. 29
L. Section 220 of the Delaware General Corporation Law
grants stockholders a qualified statutory right to inspect a corporation’s
books and records for a proper purpose. 30 Under Section 220(b), a stockholder seeking to inspect corporate records must submit a “written demand under oath.” 31 If a stockholder seeks corporate records beyond the
24 See Compl. at 1.
25 See Answer at 1.
26 See Order Governing Case Sched. ¶ 3, Dkt. 13.
27 See Opening Br.; Answering Br.; Pl.’s Reply Pre-Trial Br. in Support of His
Demand to Inspect Books & Records Under 8 Del. C. § 220, Dkt. 27 (“Reply Br.”).
28 Def.’s Ex. 15.
29 Pl.’s Exs. 6–7.
30 Barkan v. Exabeam, Inc., 2025 WL 1088821, at *5 (Del. Ch. Apr. 11, 2025).
31 8 Del. C. § 220(b).
-6-stock ledger or list of stockholders, Section 220(b) says three other things
must also be true.
M. First, the demand must be “made in good faith and for a
proper purpose.” 32 A proper purpose is “a purpose reasonably related to
a stockholder’s interest as a stockholder.” 33 This means “the [stockholder’s] purpose must be something that stockholders would be interested in because of their position as stockholders.” 34 “There is no shortage of proper purposes under Delaware law[.]” 35 “[O]nce a stockholder
has identified a proper purpose, . . . the burden shifts to the corporation
to prove that the stockholder’s avowed purpose is not her actual purpose
and that her actual purpose for conducting the inspection is improper.” 36
N. Second, the demand must describe “with reasonable particularity the stockholder’s purpose and the books and records the stockholder seeks to inspect.” 37 A demand states the records sought with reasonable particularity “[s]o long as [it] enables the receiving corporation
32 8 Del. C. § 220(b)(2)a.
33 8 Del. C. § 220(a)(2).
34 Lynn v. EnviroSource, Inc., 1991 WL 80242, at *2 (Del. Ch. May 13, 1991).
35 Melzer v. CNET Networks, Inc., 934 A.2d 912, 917 (Del. Ch. 2007).
36 Woods Tr. of Avery L. Woods Tr. v. Sahara Enters., Inc., 238 A.3d 879, 891
(Del. Ch. 2020).
37 8 Del. C. § 220(b)(2)b.
-7-to understand why the stockholder seeks inspection and what sort of
documents it needs to look for[.]” 38
O. Third, the “books and records” the stockholder seeks to inspect must be “specifically related to the stockholder’s purpose.” 39 The
stockholder must “establish that each category of the books and records
requested is essential and sufficient to the stockholder’s stated purpose[s].” 40 A stockholder is not entitled to inspect all the records they
seek simply because they have unanswered questions. 41
P. If the corporation refuses to permit inspection or does not
reply to the demand within five business days, Section 220(c) allows the
stockholder to file suit seeking an order to compel that inspection. 42 If
the stockholder proves they are a stockholder and have met Section
220(b)’s requirements, the court may order the production of nine categories of statutorily defined “books and records.” 43
Q. If the stockholder has satisfied Section 220(b)’s requirements but the corporation does not have certain categories of “books and
38 Moran v. Unation, Inc., 2025 WL 3706330, at *10 (Del. Ch. Dec. 22, 2025).
39 8 Del. C. § 220(b)(2)c.
40 Unation, 2025 WL 3706330, at *12 (quoting Thomas & Betts Corp. v. Leviton
Mfg. Co., 681 A.2d 1026, 1035 (Del. 1996)).
41 Frank v. Nat’l Hldgs. Corp., C.A. No. 2021-0160-MTZ, at 15–16 (Del. Ch.
July 22, 2022) (TRANSCRIPT).
42 8 Del. C. § 220(c).
43 Id.; see also 8 Del. C. § 220(a)(1) (defining a corporation’s “books and records”
for purposes of Section 220). I refer to these as the “Section (a)(1) books and records.”
-8-records”—specifically, minutes of stockholder, board, or board committee meetings; written consents evidencing stockholder action without a
meeting; annual financial statements; or director independence questionnaires (for publicly traded corporations)—the court may order the
corporation to produce the “functional equivalent” of the missing books
and records, but “only to the extent necessary and essential to fulfill the
stockholder’s proper purpose.” 44
R. If a stockholder wants more than the stock ledger, list of
stockholders, and Section (a)(1) books and records (or their functional
equivalents in certain cases), the stockholder has a heavier burden.
First, the stockholder must satisfy Section 220(b). 45 Second, the stockholder must show a “compelling need” to inspect these additional corporate records. 46 Third, the stockholder must show by “clear and convincing evidence” that “such specific records are necessary and essential to
further such purpose.” 47
44 Unation, 2025 WL 3706330, at *5.
45 8 Del. C. § 220(g)(1).
46 8 Del. C. § 220(g)(2).
This means plaintiff must establish that “the records
sought are pivotal to [his] stated purpose and that [he] would not be able to obtain the information therein from Section 220(a)(1) books and records (or another source).” Unation, 2025 WL 3706330, at *23.
47 8 Del. C. § 220(g)(3).“Evidence is clear and convincing if it ‘produces an abiding conviction that the truth of the contention is highly probable.’” Unation, 2025 WL 3706330, at *24 (quoting Hudak v. Procek, 806 A.2d 140, 147 (Del. 2002)). “To establish proof by clear and convincing evidence means to prove something that is highly probable, reasonably certain, and free from serious doubt.” Id.
-9-IT IS ORDERED, this 5th day of October, 2026, that:
1. The Company does not dispute plaintiff’s stockholder status, nor has it raised an issue with plaintiff’s compliance with the form
and manner requirements for making a demand under Section 220.48
The balance of this Report thus focuses on the disputed issues: whether
plaintiff’s stated purposes for inspection are proper purposes and, if so,
whether plaintiff has met the required evidentiary threshold to show his
entitlement to the books and records he seeks. The court finds two of
plaintiff’s purposes are proper and he is entitled to some additional documents.
Plaintiff’s Purposes
2. The parties dispute whether plaintiff has met his burden
to demonstrate a proper purpose. Plaintiff argues five independent purposes: (1) valuation; (2) investigating mismanagement; (3) investigating
related-party transactions; (4) determining dilutive effect of the equity
issuance; and (5) assessing the Company’s current financial condition.
The Company suggests these purposes fall into two recognized purposes:
investigating wrongdoing and valuation. 49 It contends neither of these
is a proper purpose for giving plaintiff additional records because plaintiff has not established a credible basis to investigate wrongdoing and
48 See Answer ¶ 4; Def.’s Ex. 8; Answering Br. 6–7.
49 Answering Br. 11.
- 10 -has not established a present need for valuation materials beyond what
the Company has already given him. 50 I find plaintiff has established
two of his purposes are proper: valuation and investigating relatedparty transactions.
3. Valuation. Plaintiff’s purpose of valuation is proper. 51
The Company argues plaintiff has no present need for valuation materials and that under Helmsman Management Services v. A & S Consultants, his purpose of valuation is thus in bad faith. 52 But the Company
misunderstands the standard. “Helmsman did not hold that stockholder must demonstrate a need to value [his] shares to satisfy [his] burden under Section 220. The Helmsman decision instead reflects the settled proposition of law that a valuation purpose must be [in good
faith].” 53 It is thus the Company’s burden to prove plaintiff’s purpose is
not his true purpose, and that his true purpose is improper. 54 The Company’s conclusory allegations of harassment and its contention that
plaintiff has sufficient valuation information are insufficient to meet
50 Id. at 12.
51 See Thomas & Betts Corp. v. Leviton Mfg. Co., 685 A.2d 702, 713 (Del. Ch.
1995), aff’d, 681 A.2d 1026 (Del. 1996) (stating valuation, particularly for private companies, has long been recognized as a proper purpose). 52 See Answering Br. 12 (citing Helmsman Mgmt. Servs., Inc. v. A & S Consultants, Inc., 525 A.2d 160, 165 (Del. Ch. 1987)).
53 Woods, 238 A.3d at 893.
54 See id. at 891.
- 11 -this burden. 55 Other arguments here largely relate to whether further
production is necessary, not whether plaintiff’s purpose is proper. 56
4. Investigating Possible Mismanagement. Investigating
possible wrongdoing or mismanagement is “[o]ne of the most traditional
proper purposes for a [Section] 220 demand[.]” 57 “[T]o establish such a
purpose, ‘a member must present some evidence to suggest a credible
basis from which a court can infer that . . . wrongdoing may have occurred.’” 58 “The credible basis standard imposes the lowest possible burden of proof . . . [and] . . . does not require a member to show by a preponderance of the evidence that wrongdoing is probable.” 59 “It requires
only that a member establish by a preponderance of the evidence that
there is a credible basis to suspect a possibility of wrongdoing.” 60 “That
burden may be satisfied by a credible showing, through documents,
logic, testimony or otherwise, that there are legitimate issues of wrongdoing.” 61 “In applying the standard to a plaintiff’s demand, ‘the court
55 See Answering Br. 1, 12.
56 Id. at 20–22.
57 KT4 P’rs v. Palantir Techs. Inc., 203 A.3d 738, 758 (Del. 2019).
58 Garner v. Authenticity.ai Invs., LLC, 334 A.3d 1108, 1126 (Del. Ch. 2025)
(quoting Gill v. Regency Hldgs., LLC, 2023 WL 4607070, at *13 (Del. Ch. June 26, 2023)).
59 Id. (alteration and omissions in original).
60 Id.
61 Id.
- 12 -may consider ongoing lawsuits, investigations, circumstantial evidence,
and even hearsay statements evincing possible wrongdoing.’” 62
5. Here, plaintiff’s purported credible basis to infer possible
mismanagement consists only of his contention that the April 2025
Deals “converted a profitable operation into one sustaining a net loss
every month.” 63 This is not enough—Delaware law is clear that a company’s poor financial performance, by itself, is insufficient to infer
wrongdoing unless protracted or extreme, 64 which is not alleged here.
Plaintiff has not met his burden to establish a proper purpose to investigate potential wrongdoing or mismanagement.
6. Investigating Potential Related-Party Transactions.
In the Demand, plaintiff says he wants to investigate potential relatedparty transactions in the April 2025 Deals and determine “whether the
acquisition involved any conflict of interest.” 65 He says the “structural
features” of the transaction “support investigating whether any director,
officer, or significant stockholder held an interest in the counterparty or
the financing.” 66 And he argues that to require him to produce any evidence of self-dealing “would read the investigatory purpose out of the
62 Gross v. Biogen Inc., 2021 WL 1399282, at *9 (Del. Ch. Apr. 14, 2021).
63 Opening Br. 11–12.
64 Woods, 238 A.3d at 894.
65 Demand 2; see also Compl. ¶ 16; Opening Br. 12; Reply Br. 10.
66 Opening Br. 12.
- 13 -statute for every private corporation in Delaware.” 67 The Company
points out plaintiff concedes he has “no evidence to suggest self-dealing”
in the April 2025 Deals. 68 It says plaintiff admits “no support for his
claim of purported ‘related-party involvement’ and is seeking only a fishing expedition.” 69 As a result, the Company concludes, plaintiff “failed
to carry his burden of showing a credible basis of . . . related-party involvement with respect to the [April 2025 Deals].” 70
7. Plaintiff’s purpose to understand if any related-party
transactions took place in connection with the April 2025 Deals is
proper. In Woods, the court held, unambiguously, “how directors and
senior officers are compensated and whether they are the beneficiaries
of any related-party transactions are basic facts that stockholders are
entitled to know . . . . Some information is so foundational that a desire
to have that information is itself a proper purpose.” 71 As the court explained:
The residual claimants are entitled to know
how their fiduciaries are taking money out of
the corporation. A stockholder should not
have to point to a valuation purpose or assert
suspicions about corporate wrongdoing to be
67 Reply Br. 10.
68 Answering Br. 18–19.
69 Id. at 19.
70 Id. at 20.
71 Woods, 238 A.3d at 901.
- 14 -able to learn how much money the directors
and senior officers are receiving. 72
Thus, under Woods, plaintiff need not put forth a credible basis to suspect the April 2025 Deals included related-party transactions. 73
8. Determining the Dilutive Effect of the Equity Issuance. I decline to find that determining a transaction’s dilutive effect
constitutes a proper purpose independent of valuation or investigating
wrongdoing. Plaintiff’s stated purpose to that end must fall within one
of those categories: either he seeks to value his shares following the
April 2025 Deals or he seeks to investigate whether those transactions
wrongfully diluted his interest. The former will be resolved as part of
plaintiff’s proper purpose of valuation. As to the latter, plaintiff failed
to establish a credible basis to infer wrongdoing. The existence of dilution is not evidence of wrongful dilution.
9. Assessing the Company’s Financial Condition. Assessing the Company’s financial condition falls within the recognized
72 Id.
73 If plaintiff were required to establish a credible basis, I would find he has
not. Plaintiff offers nothing more than suspicion, pointing to the overall terms of the Spitfire Audio acquisition and arguing “[t]he combination of a $53 million transaction financed with expensive debt and new equity in a single month, followed by immediate and sustained net losses” provides a credible basis to infer potential self-dealing. See Compl. ¶ 16; Opening Br. 12. As a basis to investigate potential wrongdoing, this would not be enough under Delaware law. See Fairthorne Maint. Corp. v. Ramunno, 2007 WL 2214318, at *8 (Del. Ch. July 20, 2007) (explaining a stockholder has not established a credible basis when their demand uses conditional language stating a desire to learn “if” or “whether” something happened) (citing authorities).
- 15 -proper purpose of valuation. This court has treated a stockholder’s desire to understand a company’s financial condition as part of valuing the
stockholder’s interest. 74 Here, assessing the Company’s financial condition describes how plaintiff proposes to evaluate his shares and is not a
separate purpose for inspection.
The Scope of the Inspection
10. Because plaintiff has met the test for an inspection, the
court must determine its scope. 75 Plaintiff, as explained, seeks eight
categories of documents. 76 Because the court has found only two of
plaintiff’s purposes proper, the requested records are necessary and essential only if they fill a material gap in the information plaintiff needs
to value his shares or to learn if the Company engaged in related-party
transactions. The annual financial statement and stockholder list already produced by the Company 77 satisfy part, but not all, of those
needs.
11. For valuation, plaintiff needs the capitalization table
sought in Category 5. The capitalization table is not one of the Section
220(a)(1) books and records, but I find plaintiff has demonstrated by
clear and convincing evidence the Company’s current capitalization
74 See, e.g., Gill, 2023 WL 4607070, at *13.
75 See Woods, 238 A.3d at 896.
76 See supra ¶ H.
77 See Def.’s Exs. 7 (financial statement), 16 (stockholder list).
- 16 -table is necessary and essential to his valuation purpose and plaintiff
has shown a compelling need for it under Section 220(g). 78 The financial
statement provides information about the Company’s value, but the
stockholder list does not explain how that value is allocated among common and preferred shares. Liquidation preferences, conversion rights,
and other rights bear directly on the value of plaintiff’s interest. Plaintiff cannot meaningfully value his interest without a current capitalization table. Further, past capitalization tables dating back to January
2024 are not necessary and essential. Nor do they lend to a compelling
need so plaintiff has not met his heightened burden under Section 220(g)
for those materials.
12. For information about related-party transactions, Categories 3 and 7 overlap. Formal board materials addressing related-party
transactions in connection with the April 2025 Deals, and any director
and officer independence questionnaires presented to the board, are necessary to identify if there were any related-party transactions and the
interests involved. Those records, which are Section 220(a)(1) books and
records, 79 are sufficient for that purpose. 80
78 See 8 Del. C. § 220(g).
79 See 8 Del. C. § 220(a)(1)e., f., i.
80 For records that are not Section 220(a)(1) books and records, I find plaintiff
has not shown a compelling need for such records nor met his burden to establish by clear and convincing evidence that such records are necessary and essential to his stated purpose. See 8 Del. C. § 220(g); Unation, 2025 WL 3706330, at *23–26.
- 17 -13. The remaining requests are neither necessary nor essential. For Categories 1 and 2, the court finds the Company’s existing production sufficient. For Category 4, the debt facility affects equity value,
but plaintiff has not identified information essential to his purposes that
requires the underlying loan agreement, term sheet, or amendments.
For Category 6, the valuations and fairness opinions described could assist valuation (if they exist) but they are neither necessary nor essential
given the financial and capitalization information already produced or
ordered produced. Finally, for Category 8, the capitalization information and the related-party transaction materials already address the
ownership structure, share rights, and potential insider interests implicated by this category; plaintiff has not shown that the broad scope of
material sought by Category 8 is necessary and essential to his proper
purposes.
Confidentiality
14. Production shall be subject to a confidentiality agreement
identical to the July 22, 2026 agreement signed by the parties. 81 Section
220 permits reasonable restrictions on the confidentiality, use, and distribution of records, including those produced under Section 220(g). 82
Applying the terms the parties recently accepted will protect the
81 See generally Pl.’s Ex. 6.
82 8 Del. C. § 220(b)(3), (h); see also Sobotta v. Return Logic, Inc., 2025 WL
3541436, at *5 (Del. Ch. Nov. 21, 2025).
- 18 -Company’s nonpublic information while permitting plaintiff to use the
records for his proper purposes. The parties’ most recently agreed-upon
confidentiality agreement is reasonable, so I adopt it here. This does not
prevent either side from moving to modify the confidentiality order for
good cause.
* * *
15. Plaintiff is entitled to production of the Company materials
described above, subject to the confidentiality agreement. The parties
must meet and confer on what records are in the Company’s possession,
custody, or control that satisfy plaintiff’s proper purposes in accordance
with my rulings and submit a proposed form of order implementing this
Report.
16. Plaintiff is not entitled to an award of costs and expenses. 83
“Under the American Rule, litigants are generally responsible for their
own costs.” 84 “Court of Chancery Rule 54(d), however, creates an exception to the general rule whereby costs ‘shall be allowed as of course to
the prevailing party unless the court otherwise directs.’” 85 “Under Rule
54(d), the ‘prevailing’ party is a party who successfully prevails on the
merits of the main issue or the party who prevailed on most of her
83 See Compl., Prayer for Relief (c); Opening Br. 23; Reply Br. 15.
84 Adams v. Calvarese Farms Maint. Corp., Inc., 2010 WL 3944961, at *24 (Del.
Ch. Sept. 17, 2010).
85 Id. (quoting FGC Hldgs. Ltd. v. Teltronics, Inc., 2007 WL 241384 (Del. Ch.
Jan. 22, 2007)).
- 19 -claims.” 86 “Courts interpret the term ‘prevailing’ to mean that a party
need not be successful on all claims, but rather must succeed on a general majority of claims.” 87 “Moreover, the Court of Chancery has ‘wide
discretion’ in awarding or apportioning costs in each particular case, including the discretion to find that no party may be regarded as having
prevailed.” 88
17. Here, no party has prevailed. Plaintiff succeeded on some
documents for some purposes, but he did not prevail on the majority of
his purposes and most of his document requests were overbroad or superfluous. For that reason, plaintiff must bear his own costs.
18. This is a Report under Court of Chancery Rule 144(b)(1).
It is not a Final Report under Rule 144(b)(2) because it does not conclude
this action. Under Rule 144(c)(2)(A), a party who wishes to file exceptions to this Report may only do so after entry of the Final Report.
/s/ Christian Douglas Wright
Magistrate in Chancery
86 Id. (quoting Brandin v. Gottlieb, 2000 WL 1005954, at *27 (Del. Ch. July 13,
2000)) (emphasis in original).
87 Id.
88 Id.
- 20 -