Supreme Court of Delaware. non-reliance provision was not RAA MANAGEMENT, LLC, Plaintiff unenforceable as against public policy. Appellant, v. Affirmed. SAVAGE SPORTS HOLDINGS, INC., Defendant Below, Appellee. West Headnotes No. 577, 2011. Corporations and Business Submitted: March 28, 2012. Organizations 101 2750 Decided: May 18, 2012. Corporations and Business Organizations Background: Potentially acquiring Mergers, Acquisitions, and company brought fraud claim against Reorganizations potentially acquired company seeking Sale or Transfer of All or recovery for costs potentially acquiring Controlling Interest of company spent in performing due diligence Agreements to Purchase or Sell for potential transaction based on potentially Stock acquired company's alleged k. Fraud and misrepresentations. The Superior Court, misrepresentation. New Castle County, granted potentially acquired company's motion to dismiss for Under New York law, provision of failure to state a claim upon which relief can nondisclosure agreement between be granted. Potentially acquiring company potentially acquiring company and appealed. potentially acquired company in which potentially acquiring company agreed that The Supreme , J., held that: potentially acquired company would have Holdings: under New York law, non-reliance no liability resulting from any representation provision in nondisclosure agreement potentially acquired company made in between parties precluded potentially course of potentially acquiring company's acquiring company's claims; due diligence precluded fraud claim by under New York law, peculiar knowledge potentially acquiring company against exception to fraudulent inducement did not potentially acquired company to recover apply to permit potentially acquiring potentially acquiring company's due company's claims; and diligence costs based on potentially acquired
Supreme Court of Delaware. RAA MANAGEMENT, LLC, Plaintiff Appellant, v. SAVAGE SPORTS HOLDINGS, INC., Defendant Below, Appellee. No. 577, 2011. Submitted: March 28, 2012. Decided: May 18, 2012. Background: Potentially acquiring company brought fraud claim against potentially acquired company seeking recovery for costs potentially acquiring company spent in performing due diligence for potential transaction based on potentially acquired company's alleged misrepresentations. The Superior Court, New Castle County, granted potentially acquired company's motion to dismiss for failure to state a claim upon which relief can be granted. Potentially acquiring company appealed. Holdings: The Supreme , J., held that: under New York law, non-reliance provision in nondisclosure agreement between parties precluded potentially acquiring company's claims; under New York law, peculiar knowledge exception to fraudulent inducement did not apply to permit potentially acquiring company's claims; and non-reliance provision was not unenforceable as against public policy. Affirmed. West Headnotes Corporations and Business Organizations 101 2750 Corporations and Business Organizations Mergers, Acquisitions, and Reorganizations Sale or Transfer of All or Controlling Interest of Agreements to Purchase or Sell Stock k. Fraud and misrepresentation. Under New York law, provision of nondisclosure agreement between potentially acquiring company and potentially acquired company in which potentially acquiring company agreed that potentially acquired company would have no liability resulting from any representation potentially acquired company made in course of potentially acquiring company's due diligence precluded fraud claim by potentially acquiring company against potentially acquired company to recover potentially acquiring company's due diligence costs based on potentially acquired