Invenergy Renewables LLC v. Leaf Invenergy Company ( 2019 )

IN THE SUPREME COURT OF THE STATE OF DELAWARE
INVENERGY RENEWABLES LLC, §
a Delaware limited liability company, § No. 293, 2019
§
Defendant Below-Appellant/ § Court Below—Court of Chancery
§ of the State of Delaware
v. §
§ C.A. No. 11830
LEAF INVENERGY COMPANY, §
a Cayman Islands exempt limited §
liability company, §
§
Plaintiff Below-Appellee/ §
Cross-Appellant. §
Submitted: September 18, 2019
Decided: September 19, 2019
Before VAUGHN, SEITZ, and TRAYNOR, Justices.
ORDER
(1) This expedited appeal follows our recent opinion in Leaf Invenergy v.
Invenergy1 (Leaf I). In Leaf I, we concluded that Invenergy breached the terms of
the LLC agreement it had with one of its investors—Leaf Invenergy (“Leaf”)—by
conducting a “Material Partial Sale” without redeeming Leaf for a contractually
defined “Target Multiple.” We held that “Leaf is entitled to damages in the amount
of the Target Multiple on the condition that Leaf surrenders its membership interest
in Invenergy”2 and remanded the case to the Court of Chancery.
1
210 A.3d 688 (Del. 2019).
2
Id. at 704.
 (2) After our remand, the Court of Chancery entered a final judgment and
order that included prejudgment interest from December 15, 2015, the closing date
of the aforementioned Material Partial Sale. Invenergy appeals the calculation of
prejudgment interest, which amounts to nearly $30 million.
(3) “A party is entitled to prejudgment interest running from the date
payment is due. The determination of the date when payment is due is a matter of
law subject to plenary review.”3
(4) Invenergy argues that prejudgment interest should not have been
calculated from December 15, 2015 but rather from June 20, 2018, because on that
date, Leaf surrendered its membership interest to Invenergy via a redemption
agreement4 and, as mentioned, our opinion in Leaf I awarded damages “on the
condition that Leaf surrenders its membership interest.”
(5) We disagree with Invenergy. “Where . . . the underlying obligation to
make payment arises ex contractu, we look to the contract itself to determine when
interest should begin to accrue.” 5 Under the LLC agreement, which is the relevant
contract here, Leaf was entitled to the Target Multiple when Invenergy closed the
TerraForm deal, which occurred on December 15, 2015.
3
Hercules, Inc. v. AIU Ins. Co., 784 A.2d 481, 508 (Del. 2001).
4
Although the parties executed this agreement before the submission date of Leaf I, the parties did
not appear to have made this agreement a part of the appellate record in Leaf I.
5
Citadel Holding Corp. v. Roven, 603 A.2d 818, 826 (Del. 1992).
2
(6) Contrary to what Invenergy’s argument suggests, it was not our opinion
that ultimately entitled Leaf to the Target Multiple. Rather, what entitled Leaf to the
Target Multiple was the LLC agreement and Invenergy’s undertaking of a Material
Partial Sale that triggered the contractual provisions we interpreted in Leaf I. And
because Leaf’s contractual right to the Target Multiple was not contingent upon a
prior unconditional surrender of its membership interests, neither does Leaf’s
prejudgment failure-to-surrender diminish Leaf’s right to prejudgment interest on
damages for an undisputed counterparty breach. That we required Leaf to surrender
its membership interest is nothing more than a judicial effort to enforce the terms of
the parties’ agreement, which provided that payment of the Target Multiple would
redeem Leaf’s interests.
(7) Leaf’s informal request for fees is denied. “Although we have authority
under Supreme Court Rule 20(f) to award attorneys’ fees in the case of a frivolous
appeal, we will not consider an informal request in the absence of a formal motion
made and presented in accordance with the Supreme Court Rules.” 6
NOW, THEREFORE, IT IS ORDERED that the judgment of the Court of
Chancery is AFFIRMED.
BY THE COURT:
/s/ Gary F. Traynor
Justice
6
Glanden v. Quirk, 128 A.3d 994, 1006 (Del. 2015).
3