In re P3 Health Grp. Holdings
Decision Date | 04 November 2022 |
Docket Number | C. A. 2021-0518-JTL |
Parties | IN RE P3 HEALTH GROUP HOLDINGS, LLC |
Court | Court of Chancery of Delaware |
ORDER DENYING MOTION BY FORESIGHT ACQUISITION CORP. FORESIGHT ACQUISITION CORP.
1. Hudson Vegas Investment SPV, LLC ("Hudson") was a minority investor in P3 Health Group Holdings, LLC (the "Company"). In this litigation, Hudson has asserted various claims based on a transaction between the Company and a special purpose acquisition company, commonly known as a SPAC.
2. The defendants filed a surfeit of motions to dismiss on various grounds, including Rule 12(b)(6). The court has issued a decision addressing the breach of contract claims that Hudson asserted. Dkt. 172 (the "Contract Opinion," cited as "Op."). This order incorporates that decision by reference.
3. In Count XI of its complaint, Hudson has asserted a claim against Foresight Acquisition Corp. ("Foresight") Foresight Acquisition Corp. II ("Foresight II") and Greg Wasson for tortiously interfering with Hudson's contractual rights.
4. Delaware has adopted the formulation of a claim for tortious interference with contract that appears in the Restatement (Second) of Torts. WaveDivision Hldgs., LLC v. Highland Cap. Mgmt., L.P., 49 A.3d 1168, 1174 (Del. 2012); ASDI, Inc. v. Beard Rsch., Inc., 11 A.3d 749, 751 (Del. 2010). Generally speaking, "[o]ne who intentionally and improperly interferes with the performance of a contract . . . between another and a third person by inducing or otherwise causing the third person not to perform the contract, is subject to liability to the other." Restatement (Second) of Torts § 766 (Am. L. Inst. 1979), Westlaw, (database updated Oct. 2022). Reframed as elements, a plaintiff must plead "(1) a contract, (2) about which defendant knew and (3) an intentional act that is a significant factor in causing the breach of such contract, (4) without justification, (5) which causes injury." Bhole, Inc. v. Shore Invs., Inc., 67 A.3d 444, 453 (Del. 2013) (internal quotation marks omitted).
5. The Contract Opinion has found that Hudson has stated claims for breach of contract and that Hudson suffered injury. See Op. at 31, 41, 44, 60, 65, 74. It is reasonably conceivable that Foresight, Foresight II, and Wasson knew about the LLC Agreement and Hudson's contract rights. The debate is over elements (3) and (4).
6. Hudson has pled that Foresight, Foresight II, and Wasson engaged in an intentional act, designed to induce breaches of contract, when Wasson offered Tolan and Kazarian the opportunity to invest in Foresight II.
7. The final element is the issue of justification.
a. "The tort of interference with contractual relations is intended to protect a promisee's economic interest in the performance of a contract by making actionable 'improper' intentional interference with the promisor's performance." Shearin v. E.F. Hutton Gp., 652 A.2d 578, 589 (Del. Ch. 1994). NAMA Hldgs., LLC v. Related WMC LLC, 2014 WL 6436647, at *26 (Del. Ch. Nov. 17, 2014). "[C]laims for unfair competition and tortious interference must necessarily be balanced against a party's legitimate right to compete." Agilent Techs. v. Kirkland, 2009 WL 119865, at *8 (Del. Ch. Jan. 20, 2009). Determining when intentional interference becomes improper requires a "complex normative judgment relating to justification" based on the facts of the case and "an evaluation of many factors." Shearin, 652 A.2d at 589 (internal quotation marks omitted).
b. The Delaware Supreme Court has adopted the factors identified in Section 767 of the Restatement (Second) of Torts as considerations to weigh when evaluating the existence of...
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