From Page 37: "...because it is unclear to what extent the Vice Chancellor based his damages award upon a promissory estoppel holding rather than upon a contractual theory of liability predicated on a Type II preliminary agreement, we reverse the Vice Chancellor’s damages award and remand the case for reconsideration of the damages award consistent with this opinion." This wording seems to suggest the possibility of Parsons giving his same damages award but merely changing the justification, which Pipsters are really hoping for.
However, look at the wording from the summary on page 2: "We also reverse the Vice Chancellor’s equitable damages award BASED ON HIS FACTUAL CONCLUSION THAT THE PARTIES WOULD HAVE REACHED AN AGREEMENT [my emphasis], so that he may reconsider the award in light of this opinion." To me this seems to be focusing more on the way the award was arrived at rather than on the legal basis, and suggests that Parsons actually has to change the actual award, not just the justification. So, while the SC never challenged Parsons’ “factual conclusion,” they seem to be saying that it can’t be used to come up with the damages award. And in footnote 99 to their statement “the plaintiff is entitled to recover contract expectation damages” they explain why it can’t – the “reasonable certainty” and “can’t be contingent, conjectural, or speculative” requirement.
Delaware Supreme Court reviewed key aspects including whether contractual provision to negotiate in good faith is enforceable and agreed with Parsons. They also agreed with Parsons conclusion that were it not for bad faith by SIGA parties would have reached an agreement (see below). Issue on page 2 is that he used "equitable damages award" and they are freeing him to reconsider award based on new precedent that in such a case he may award "expectation damages". Read my post titled "Doubts Resolved in Favor of Non-Breaching Party - Expectation Damages". Under equitable damages he moved more in SIGA's favor regarding terms of agreement he felt they would have reached (obviously that was not in favor of non-breaching party). Agree that wording is MAY, he may not.
"Different standards of review apply to different portions of this appeal. We review de novo . . .The Vice Chancellor’s conclusions concerning whether a contractual provision requiring parties to negotiate in good faith is enforceable . . ." (p17)
"SIGA argues that the Vice Chancellor erred when he concluded that SIGA breached an obligation to negotiate in good faith under the Bridge Loan and Merger Agreements. . . . We disagree." (p21)
"Therefore, we affirm the Vice Chancellor’s conclusion that SIGA acted in bad faith when negotiating the license agreement in breach of its contractual obligations under both the Merger Agreement and the Bridge Loan Agreement." (p29-30)
"In this case, the Vice Chancellor made two key factual findings, supported by the record: (1) “the parties memorialized the basic terms of a transaction in . . .the LATS, and expressly agreed in the Bridge Loan and Merger Agreements that they would negotiate in good faith a final transaction in accordance with those
terms”100 and (2) “but for SIGA’s bad faith negotiations, the parties would have consummated a license agreement.” The Vice Chancellor’s factual conclusions support a finding that SIGA and PharmAthene e
I am just hoping that it means Parsons will have to change the damages to just reliance damages only since his "the parties would have come to an agreement" method for determining an award doesn't meet the "can't be speculative" requirement. I also think Golong's guess that Parsons could reduce the award to something like 7% instead of 50% to be more in line with the LATS is a possibility too, since the SC said to "look to the contract."