CHANCERY COURT FINDS REQUEST FOR SPECIFIC ENFORCEMENT OF A PARTNERSHIP INTEREST CALL RIGHT IS PROVED BY CLEAR AND CONVINCING EVIDENCE
By Scott E. Waxman and Joseph Phelps
In Simon-Mills II, LLC v. Kan Am USA XVI Ltd. Partnership, No. 8520-VCG (Del. Ch. May 30, 2018), the plaintiffs, a number of entities organized under an umbrella real estate investment trust and referred to as “Simon,” sought specific performance of a call right applicable to partnership interests under a joint venture agreement (the “JVA”) with the defendant Kan Am, a group of Delaware limited partnerships. In exchange for the called units, Simon proposed to issue to Kan Am units (the “Successor Units”) that it argued had “substantially the same” rights as the originally contemplated consideration units (the “Original Units”). The Court of Chancery concluded that the Successor Units did indeed have “substantially the same” rights as the Original Units, within the meaning of the JVA, and that Simon proved by clear and convincing evidence that it was entitled to specific performance of the call right. Read More