In affirming the Court of Chancery’s determination in a Section 225 action that Timothy Pohl (“Pohl”) was the sole director and officer of a Delaware corporation, the Delaware Supreme Court rejected Appellants’ argument that the forum selection clause of a pertinent credit agreement (“Agreement”) bound Pohl, a non-signatory. The Supreme Court found that Appellants waived that argument because neither the trial record nor the post-trial briefing reflected that Appellants had argued that Pohl was bound by the forum selection clause that would have required a New York forum.
The Supreme Court also rejected Appellants’ argument that the Court below erred in not crediting Appellants’ claim that Appellants’ breach that triggered their director’s removal was excused under the impossibility doctrine based on certain unforeseeable regulatory changes. The Court reasoned “it was foreseeable at the time of executing” the Agreement that the pertinent regulatory provision might be eliminated because proposed new regulations, published three months prior to the Agreement’s execution, already had omitted the provision. Accordingly, the Court “struggle[d] to believe that the sophisticated, well-counseled parties for this billion-dollar transaction could not have foreseen the elimination” of the pertinent regulatory provision.
