SUPERIOR COURT
OF THE
STATE OF DELAWARE
PATRICIA A. WINSTON LEONARD L. WILLIAM JUSTICE CENTER
JUDGE 500 NORTH KING STREET, SUITE 10400
WILMINGTON, DELAWARE 19801-3733
TELEPHONE (302) 255-2549
October 28, 2026
VIA FILE&SERVEXPRESS
Brian M. Gottesman, Esquire Alessandra Glorioso, Esquire Gabell Beaver, LLC Dorsey & Whitney LLP 5811 Kennett Pike 300 Delaware Avenue, Suite 1010 Wilmington, DE 19801 Wilmington, DE 19801
Re: Fedelta Partners, LLC v. Aware360 Ltd., et al.,
C.A. N25C-03-253 PAW CCLD
Dear Counsel:
This letter opinion addresses Plaintiff’s motion for partial summary judgment.
In writing for the parties, I assume the readers’ familiarity with the background of
the case. For the following reasons, the motion is denied.
In this action, Plaintiff contends that Defendants made an unequivocal,
positive, and unconditional statement about their intent not to make Payment 3 when
it refused to make an escrow payment for the undisputed portion of Payment 3— $1,618,771—both parties accepted during the pre-litigation negotiations.1 Because
Location Based Holdings Corp. d/b/a AlertGPS (LBH) historically used accrual
accounting, under which debt was treated as an operating expense rather than a
reduction in revenue, and because LBH historically recorded a bad debt expense
only after confirming a debt was uncollectable, Plaintiff also contends that income
from Sutter and other Disputed Slow Pay Customers must be included in the
Payment 3 calculation because LBH would have counted its income as revenue.2
Defendants contend their statements that they would not pay “at that time”
cannot be read as unequivocal, positive, and unconditional, because they confirmed
they would make a contractually contemplated payment, with interest, if applicable.3
Defendants also argue that three of the Disputed Slow Pay Customers, including
Sutter, cannot be included in the Payment 3 calculation because their contracts were
entered into after closing.4
Summary judgment is appropriate “when the [record] show[s] [] there is no
genuine issue as to any material fact, and [] the moving party is entitled to a judgment
1
D.I. 23, Op. Br. in Supp. of Pl.’s Mot. Summary J. (hereinafter “Op. Br.”) at 20-24.
2
Id. at 17.
3
D.I. 33, Defs.’ Opp’n to Pl.’s Mot. Summary J. (hereinafter “Ans. Br.”) at 6-8. 4
Id. at 9.
2
as a matter of law.”5 The moving party bears the burden of demonstrating the
undisputed facts entitle it to judgment as a matter of law.6 “When the moving party
sustains the initial burden of showing the nonexistence of any material issues of fact,
the burden shifts to the non-moving party to substantiate its adverse claim by
showing that there are material issues of fact in dispute.”7 “If the facts permit
reasonable persons to draw from them but one inference, the question is ripe for
summary judgment.”8 Summary judgment will not be granted, however, “if, upon
an examination of all the facts, it seems desirable to inquire thoroughly into them in
order to clarify the application of the law to the circumstances.”9
A. THE ANTICIPATORY REPUDIATION CLAIM RESTS ON AN IMPLIED
ESCROW OBLIGATION THAT THE CONTRACT DOES NOT CONTAIN.
“Under Delaware law, repudiation is an outright refusal by a party to perform
a contract or its conditions entitling ‘the other contracting party to treat the contract
as rescinded.’”10 To prove anticipatory repudiation, a claimant must point to a
5
Super. Ct. Civ. R. 56(c).
6
Moore v. Sizemore, 405 A.2d 679, 680 (Del. 1979).
7
Brzoska v. Olson, 668 A.2d 1355, 1364 (Del. 1995) (citing Moore, 405 A.2d 679, 680).
8
Id. at 1364 (citing Wootten v. Kiger, 226 A.2d 238 (Del. Super. 1967)). 9
Ebersole v. Lowengrub, 180 A.2d 467, 468-69 (Del. 1962).
10
CitiSteel, USA, Inc. v. Connell Limited Partnership, 758 A.2d 928, 931 (Del. Aug. 11, 2000) (quoting Sheehan v. Hepburn, 138 A.2d 810, 812 (Del. Ch. Feb. 20, 1958)).
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promisor’s “unequivocal statement” that is “positive and unconditional” about its
intent to not perform its contractual obligation.11
Plaintiff has failed to establish that the alleged statement—Defendants would
not be in a position to make Payment 3 at that time, but intend to make Payment 3,
including any applicable interest—is an unequivocal, positive, and unconditional
statement of Defendants intent not to pay. Setting aside the intent of Defendants’
statement, Plaintiff’s basis for its anticipatory repudiation claim is Defendants’
refusal to place the lowest agreed-upon amount into escrow,12 yet Plaintiff failed to
support this contention. In fact, the SPA sets out a process for resolving disputes
over Deferred Payments Calculations: Defendants submit a Calculation Statement;
Plaintiff reviews and either accepts or objects to it; if Plaintiff objects, the parties
enter a good-faith negotiation period; and if they cannot agree on a finalized
11
Carteret Bancorp, Inc. v. Home Grp., Inc., 1988 WL 3010, at *5-6 (Del. Ch. Jan. 13, 1988).
12
See Compl. ¶¶ 64-72 (alleging that Defendant did not deposit the undisputed payment floor amount into escrow); Op. Br. at 10-11 (“After an unsuccessful negotiation period, the deadline under the SPA for the parties to agree upon a Deferred Payment Calculation for Payment 3 expired. [Plaintiff] requested that [Defendant] place in escrow the lowest amount agreed upon by the parties, $1,618,771, while the parties negotiated their dispute regarding the additional $347,452.52 . . . [Plaintiff] requested that [Defendant] pay the Undisputed Payment Floor . . . into escrow within ten (10) days from [Plaintiff’s] request . . . [Defendant] did not comply.”); See Op. Br. Ex. F (notifying Defendant of Plaintiff’s demands, which Defendant refused to comply).
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calculation during that period, they submit the dispute to an accounting firm.13 No
provision requires Defendants to place any amount in escrow, even if the parties
agree a floor amount is owed.14
Plaintiff relies on the general Payment 3 provision, which broadly provides
that Defendants shall remit Payment 3 to an escrow agent once calculated.15
Plaintiff’s reading assumes there is no dispute as to what Payment 3 is, or any dispute
has been resolved. “Where sophisticated parties addressed a certain contractual
issue, the Court will not imply terms that parties failed to include but which could
have been drafted.”16 Plaintiff is not only asking the Court to imply such a term
here, but it is also moving for summary judgment on its anticipatory repudiation
claim on the grounds that Defendants breached that implied term.
B. A FULLER FACTUAL RECORD IS NECESSARY TO RESOLVE THE
CUSTOMER-RELATED DISPUTE.
There is no genuine dispute of material fact regarding the Disputed HHS
Customers. While Plaintiff submits its contentions concerning the Disputed HHS
Customers in detail, along with its basis for summary judgment, Defendants do not
13
See generally SPA Ex. A (hereinafter “Deferred Payments Agreement”) § 2. 14
Id.
15
See generally Op. Br. at 10-12; Deferred Payments Agreement § 1(c)(ii)(2)(b). 16
AG Mobile Holdings, L.P. v. H.I.G. Mobile, L.P., 2025 WL 501088, at *12 (Del. Ch. Feb. 13, 2025) (internal quotations omitted).
5
address these arguments and do not discuss any Disputed HHS Customer in their
opposition.17 Failure to respond to an argument raised in a motion constitutes
waiver.18
As previously stated, Plaintiff contends that income from Sutter and other
Disputed Slow Pay Customers must be included in the Payment 3 calculation
because LBH’s use of accrual accounting would have counted their income as
revenue, and because LBH historically recorded a bad debt expense only after
confirming a debt was uncollectable. Defendants counter that Sutter and two of the
Disputed Slow Pay Customers cannot be included in the Payment 3 calculation
because their contracts were entered into after closing. Defendants also raise various
other arguments that they say preclude summary judgment as to other Disputed Slow
Pay Customers, including that Plaintiff seeks to include amounts invoiced to
Franciscan Alliance even though that company went out of business before Plaintiff
invoiced it.19
Beyond the Disputed HHS Customers and the Disputed Slow Pay Customers,
there is a third category of customers in dispute: the “miscellaneous customers.”
Plaintiff did not move for summary judgment as to these customers, yet they make
17
See generally Ans. Br.
18
See Emerald P’rs v. Berlin, 726 A.2d 1215, 1224 (Del. 1999).
19
Ans. Br. at 10-11.
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up the majority of the 26 total Disputed Customers.20 Accordingly, “it seems
desirable to inquire thoroughly” into these factual issues that Defendants raise.21
Furthermore, Defendants note that at this juncture, “[Plaintiff] has yet to produce
any documents” in discovery at all, let alone documents about how LBH historically
would’ve treated income.22 The question of whether LBH would have historically
treated an item of income as revenue is central to the SPA’s definition of “Revenue.”
Allowing the parties to engage in more discovery on LBH’s historical treatment of
income would be helpful to the Court. Accordingly, Plaintiff’s motion for partial
summary judgment is denied.
Very truly yours,
/s/ Patricia A. Winston
Patricia A. Winston, Judge
20
See Op. Br. at 13, 18-20 (establishing that Sutter and the Slow Pay Customers represent six, Disputed HHS Customers represent six, and miscellaneous customers represent fourteen of the total Disputed Customers, respectively). 21
Ebersole, 180 A.2d 467, 468 (Del. 1962).
22
Ans. Br. at 11.
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