LG Land, LLC v. Dream Finders Holdings, LLC

Summary

The Delaware Court of Chancery dismissed the plaintiffs’ action seeking confirmation of a KPMG decision as an arbitration award under 10 Del. C. § 5713. The court held that the parties’ agreement created an expert determination through an accountant true-up mechanism, not an arbitration, and therefore the statutory basis for Chancery jurisdiction was unavailable. The dismissal was subject to transfer to the Delaware Superior Court under 10 Del. C. § 1902 within sixty days.

Holdings

1. KPMG's decision was an expert determination, not an arbitration award, because the agreement expressly designated KPMG as an expert and limited its authority to resolving specified factual disagreements concerning net asset value.
2. The Court of Chancery lacked subject matter jurisdiction because the plaintiffs sought confirmation of an expert determination rather than an arbitration award, and their remaining claims sought legal relief for which an adequate remedy existed at law.
3. The action was dismissed subject to the plaintiffs' ability to transfer it to the Delaware Superior Court under 10 Del. C. § 1902 within sixty days.

Questions Presented

1. Whether the Court of Chancery had statutory subject matter jurisdiction under 10 Del. C. § 5713 to confirm KPMG's decision as an arbitration award.
2. Whether the parties' contractual dispute-resolution mechanism constituted an arbitration or an expert determination.
3. Whether the plaintiffs' alternative legal claims for damages and proposed supplemental legal claims independently invoked the Court of Chancery's equitable or statutory jurisdiction.

Disposition

dismissed