Judicial Overreach in Delaware
Judicial activism–or judicial overreach, as it is sometimes called–refers to judicial rulings suspected of being based on personal or political considerations rather than on existing legal precedent. The scary thing about a situation like this is that in the law, when such a decision is upheld, it is tantamount to legislating from the bench, in effect, creating new law, which is not the responsibility of the judiciary. Law-making is supposed to come from the legislative branch of our government, in order for our democratic system to work as it should.
In Delaware’s renowned Court of Chancery, famous for resolving corporate disputes equitably, Chancellor Andre Bouchard’s rulings in the TransPerfect case have indisputably gone wildly beyond what is fair and equitable, and obviously been adjudicated from his personal bias, rather than applying the law appropriately. In my opinion his actions in this case, besides obvious appearances of impropriety, make him seriously suspect.
1) How does declaring an internal dispute between stockholders equate to irreparable harm, when TransPerfect continuously makes tremendous profits?
2) How does this judge justify ordering the sale of this profitable company for the sole benefit of one stockholder because of his personal bias? Is it because he is scratching the back of his cronies at “Skadden Arps” to raid the company coffers, and siphon off TransPerfect profits under the false premise of “helping” the company, which is already the leader in it industry?
3) How can Bouchard legitimately sanction the defendant in this case an unprecedented $7.1 million dollars based on the concept that he attempted to spoliate documents. No concept exists in the law. Either evidence is destroyed or it is not. Shawe’s e-discovery expert, and 3 other experts testified Shawe saved all evidence appropriately.
Bouchard’s rulings are carefully crafted to avoid the word “spoliation” because Elting did not and could not prove her case. Regardless of the evidence, Bouchard sought to punish Shawe by grabbing headlines with deceiving rhetoric, such as Shawe “deleted” certain evidence. Not true, folks!!!
Are we to believe that the Chancellor could be so technologically inept, that he failed to understand that once data is “preserved” – in this case with a mirror image – the gold-standard of evidence preservation – that it can no longer be “deleted”? No. We should not be fooled. Bouchard sought to illegally issue punitive sanctions and destroy Shawe’s reputation based on headline-grabbing rulings which were patently false and grossly misleading.
4) How can Chancellor Bouchard award $1.4 million dollars to the plaintiff’s attorney (his personal friend!!) to be paid by the defendant without so much as an itemized bill from Kevin Shannon at Potter Anderson. I guess this is the treatment you get when you travel to New Orleans with a Chancellor, socialize together, and make public co-paneling appearances – In the middle of the case, when Chancellor Bouchard, who is the entire judge and jury, would normally be sequestered in a non-bench trial. But Bouchard was not sequestered, when he decided this case, he was traveling on taxpayer money to New Orleans to attend a boondoggle at Tulane University with Elting’s attorney. Are we expected to be naive enough to believe this boondoggle with Shannon, didn’t influence Bouchard, when weeks before he promised a “measured” decision. No folks, we aren’t, this has the appearance of corruption by Andre Bouchard, and it should be investigated.
5) How can Chancellor Bouchard appoint another friend and his former law partner, as a Custodian of TransPerfect, and then allow him to charge $1,400 per hour with no limit whatsoever. Did he do it to benefit his friend Bob Pincus, and his former law firm, for some pay-off down the road? Bouchard has allowed Skadden Arps to bilk TransPerfect to the tune of over $3 million dollars?!? ….in a single year?! For attending a board meeting once a month?? I am amazed and appalled at this seemingly, blatant attorney misuse of TransPerfect’s hard-earned dollars. Money that should and could be going for raises for the TransPerfect staff, is instead going directly into Pincus’ pockets … all approved by Chancellor Andre Bouchard. Talk about the appearance of impropriety – Wow!. It is a disgrace and it must stop!
6) How can this Judge not be required to know the U.S. Constitution, and sign an order violating the First and Fourth Amendment rights of TransPerfect’s thousands of U.S.-based employees?!? … and get away with it. The law firm of Skadden Arps, through his former law partner Bob Pincus, is an arm of the court and Bouchard has granted him sweeping powers to fire, sanction, or fine any employees that talk to the press or don’t want to give over their private emails, phones or records. The Chancery’s unprecedented sale order granting Pincus never-before-granted sweeping powers to punish at will – is a blatant disregard of the “due process” requirements of the U.S. Constitution, and has created an atmosphere of fear and discord at TransPerfect? The workers deserve better.
Someone must stand up to Bouchard, the omnipotent-bully Chancellor, who apparently seeks to punish those who speak out against his controversial actions and decisions. I have talked with enough employees to know this is not a stretch of anyone’s imagination. TransPerfect’s in-house counsel was forced to choose between doing Pincus’ illegal bidding or quit her job. Amazing stuff going on in this company folks that is fodder for a best-seller.
Shockingly, this is just the tip of the iceberg, as each and every successive ruling I examine by Chancellor Andre Bouchard seems to have no basis in law, but reeks to holy hell of his possible, personal bias, cronyism, and desire to enrich his friends.
I have now spoken to many attorneys (who are afraid to speak out), who have told me they have never seen a Chancellor or Judge rule so obviously and consistently against one litigant, when indeed the evidence, overwhelming and indisputably stated the complete opposite of his rulings.
I urge the Delaware legislature in its upcoming session to order the Court of the Judiciary to investigate Andre Bouchard for possible wrongful acts, and to make a law that requires STANDARDS that must be followed when the Chancery Court makes custodian decisions in the future. I’m told in New York, they spin a wheel to appoint Custodian’s to prevent this sort of thing from happening. Why not spin a wheel in Delaware? Make it a random appointment instead of creating the possibility of corruption?
This all amounts to not only harming and risking the jobs of 4,000 TransPerfect jobs, but also possibly destroying millions of dollars of Delaware capital that is derived from Delaware’s incorporation fee bonanza, which is now seriously at risk. Ruining 4,000 people’s lives will not go down easy for the State of the Delaware, when the only tangible result has been to enrich the law firm of Skadden Arps and their consultants, and investment banker friends.
If the Delaware Supreme Court refuses to recognize what is happening, because of the hometown relationships there – the Delaware General Assembly MUST step in and do its duty. It must protect our state’s image and economy – and cannot allow this rogue and apparently unprincipled Chancellor to create these appearances of impropriety which will kill Delaware’s very profitable corporate franchise. We need to give this situation proper consideration, and investigate.
Delaware’s judicial reputation is truly at stake over the next month. It is time for Delaware to show the world that it will not allow Chancellor Bouchard’s cronyism to conquer justice.