David Handler v. Centerview Partners Holdings L.P.

IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE

DAVID HANDLER, )
)
Plaintiff, )
)
v. ) C.A. No. 2022-0672-SG
)
CENTERVIEW PARTNERS )
HOLDINGS L.P., )
)
Defendant.

Date Submitted: November 7, 2023
Date Decided: April 24, 2024

C. Barr Flinn, Elisabeth S. Bradley, Kevin P. Rickert, Zeliang Liu, Hana Brajuskovic,
and Elena C. Norman, YOUNG CONAWAY STARGATT & TAYLOR, LLP,
Wilmington, Delaware, Attorneys for Plaintiff David Handler.

Michael A. Barlow and Hayden Driscoll, QUINN EMANUEL URQUHART &
SULLIVAN, LLP, Wilmington, Delaware, Attorneys for Defendant Centerview
Partners Holdings, L.P.

GLASSCOCK, Vice Chancellor
The narrow, and rather unusual, subject of this Memorandum Opinion is

whether Plaintiff, David Handler, was an employee of a Delaware L.P., or was in

fact a partner in the entity that managed that L.P. The L.P. itself is an investment

firm, a fact perhaps surprising in light of the informality with which the individuals

involved here conducted themselves and their business, internally. The case arose

as a request for books and records, standing for which was denied by the L.P. on the

ground that Handler was not a partner.1

Handler was initially an employee of the L.P., and was given the title

This was an honorific; such partners were no

more equity holders than Colonel Harland Sanders was a field officer, although they

did in some cases have rights upon liquidation for deferred compensation. For

several years thereafter, Handler discussed the terms of a partnership in

the entity managing the Partnership, with the firm s founders. The dispute here is

whether Handler was offered and accepted a partnership in Topco, subject only to

agreement on non-essential terms, or whether, as Defendant asserts, there was never

a meeting of the minds with respect to a partnership in Topco. The matter comes

down to one meeting of Handler with the founders, and whether a partnership

1
A companion substantive case, dependent in part upon the outcome
rights after leaving the company. Centerview P rs Hldgs. LP v. Handler, C.A. No. 2022-0767-
SG.

1
agreement was reached at that meeting. Handler alleges that an oral partnership in

Topco was agreed to at that November 8, 2012 meeting.

The issue

books and records) was tried. In this post-trial Memorandum Opinion, I find that

Handler has failed to show, by a preponderance of the evidence, that the parties

reached an agreement under which Handler (and his fellow employee, non-party

David St. Jean) became partners in Topco. The recollections of the crucial

meeting are in conflict; the post-meeting correspondence between the founders and

Handler and St. Jean, and between St. Jean and Handler themselves, supports a

conclusion that no agreement was reached, and the abundant documentary evidence

after the meeting is inconclusive. Handler has failed to demonstrate that he is a

partner in Topco.

I. FACTUAL BACKGROUND2

A. The Parties

joined a subsidiary of Centerview Partner

or, with its subsidiaries, ) in 2008 as an

P

2

See Updated Final Joint Trial Exhibit List, Dkt. No. 187. Citations to the
- Pretrial Stipulation and [Proposed]
Order, Dkt. No. 145. Tr. of 7-25-2023
Evidentiary Hr g Volume I, Dkt. No. 198; Tr. of 7-26- 2023 Evidentiary Hr g Volume II,
Dkt. No. 199.

2
technology practice group.3 Handler joined the Company together with his friend,

non-party David St. Jean.4 Handler resigned from the Company on August 1, 2022.5

6
Centerview maintains offices in New York, London, San Francisco, Menlo

Park, and Paris.7

Centerview has a multilayered entity structure, with Topco being the highest
8
entity in Topco is the sole manager of

investment banking

operating company.9

Topco was formed as a Delaware limited liability company on December 7,
10
A later-filed Certificate of Amendment was filed

with the Secretary of State of the State of Delaware on June 6, 2006, which changed

converted into a Delaware limited partnership on November 19, 2013, with the

3
PTO ¶ 18.
4
Id.
5
Id.
6
Id. ¶ 19.
7
Id.
8
Id. ¶ 20.
9
Id.
10
Id. ¶ 21.

3
, 11 to which I will refer, in its

-dealer subsidiary,

Centerview conducts its U.S. advisory business.12

Non-

and are limited partners in Topco .13

Centerview Partners Holdings LP
, Pruzan
Holding LLC, Centerview Partners
Holding LLC

Centerview Partners
Advisory Holdings LLC

99%

Centerview Partners
LLC
(operating company)

11
Id.
12
Id. ¶ 22.
13
Id. ¶ 23.

4
B. The 2008 Letter

On June 16, 2008, Handler and

two non-parties, David St. Jean and an undisclosed third party, joined Centerview as

employees of CP LLC , creating a Tech Team practice

in the Company.14 Although the 2008 Letter referenced Handler and St. Jean as

it did not reflect an actual partnership agreement at Centerview, but

reflected an at-will employee status.15 The 2008 Letter, however, guaranteed that

Handler and St. Jean would earn 35% of revenues they generated up to $25 million,

40% of all revenues between $25 to $40 million, and 50% above the $40 million

threshold.16

In addition, the 2008 Letter enabled Handler and St. Jean to participate in a

fixed share of the Centerview Partners Profit Pool after 2010.17 The 2008 Letter also

interest in the terminal value of Centerview upon a liquidity event (sale, IPO etc) . .

. .18 The 2008 Letter explicitly stated that TVIs did not entitle Handler and

St. Jean to a share of profits of the firm, ownership, or governance rights.19 Further,

14
JX2; PTO ¶ 18.
15
JX2 at 2; Dep. of David Handler 35:20 36:3 First Handler Dep . Centerview purportedly

their own client relationships. -Trial Opening Br. 2, Dkt. No. 201
16
JX2 at 1.
17
Id.
18
Id.
19
Id.

5
the 2008 Letter provided that if either Handler or St. Jean left Centerview before a

liquidity event occurred, at its tax

value at the date of grant plus interest at 2.5%.20

C. Partnership Proposals & Negotiations Prior to the Purported Oral
Partnership Agreement

After 2008, there were several failed attempts between the Founders and

Handler to renegotiate the relationship created by 2008 Letter Agreement into a

partnership agreement.21 In 2011, St. Jean expressed a disdain for only receiving a

Centerview and failure to reach a partnership agreement.22 In

response, Effron expressed a commitment to working with St. Jean to achieve the

latter result.23 Soon after, Handler began to voice his concerns to the Founders about

not being a Topco partner, threatened to leave the Company, and told a third party

about his frustrations.24 Eventually, on September 20, 2012, the Founders presented

Handler and St. Jean a 60-

expressing the Founders intent to add Handler and St. Jean as partners in Topco.25

20
Id.
upon a liquidity event . . . and will not entitle any of you to a share of profits of the firm or have
Id.
21
JX23; JX7; JX11; JX15-17; First Handler Dep. 50:3 53:4, 90:4 91:25, 105:6 11.
22
JX12.
23
Id.
24
JX24; JX26; Tr. 14:22 16:2 (Handler).
25
JX30.

6
Handler, for numerous reasons, rejected the proposed LPA without offering a

counterproposal and continued to express his intent to leave the Company.26 On

October 24, 2012, in an email to Pruzan, Effron recounted an offsite meeting, stating

that Handler and St. Jean wanted further negotiations to concern terms to
27
In other

words, in an offsite meeting Handler and St. Jean conveyed to Effron that they were

focused on changing their employment terms under the 2008 Letter, instead of

negotiating the proposed Topco partnership agreement.28

Three days later, Handler and St. Jean

the 2008 Letter that served as their employment contract; the addendum addressed

their annual compensation and suggested the establishment of a new technology

focused private equity fund.29 In response, the Founders began preparing a draft

term sheet, which, contrary to the addendum, described a classic partnership with

shared participation, risk, and reward.30

26
Tr. 29:14 15, 30:15 31:1 (Handler). Handler rejected the LPA because it gave the Founders
the right to effectively cancel the deal or change it in a material way, among other reasons. Id.
27
JX35.
28
Id.
29
JX39 at 3; Tr. 215:6 11 (Handler). In regard to compensation, the addendum provided that the
Tech Team would be paid 60% of revenue it generated, by Centerview Partners, LLC.
30
JX43; JX44; JX47.

7
D. The Purported Oral Agreement

31
The term sheet included a compensation

change for Handler and St. Jean and identified issues the parties would need to

negotiate if they ultimately were to reach a written partnership agreement. 32 In

particular, the proposed term sheet described traditional partnership concepts, such

as sharing in profits and losses in the Company.33

34

35

31
JX52; Tr. 36:4 40:1 (Handler).
32
JX52.
33
Id.; Tr. 41:3 22 (Handler).
34
JX52 at 4.
35
Tr. 55:22 56:3, 145:7 11, 149:1 7, 153:9 10 (Handler); Tr. 45:19 46:7 (Handler).

8
36

37

38

39

36
See generally, JX52; see also Tr. 51:10, 174:1 175:6 (Handler); see also Tr. 38:4 45:15, 54:15
55:1 (Handler); JX474 ¶ 18; JX413 at No.16.
37
JX52; First Handler Dep. 123:1 6.
38
Tr. 160:13 18 (Handler).
39
See Tr. 361:5 19 (Pruzan); see, e.g., Tr. 139:19 142:15, 387:5 20, 388:1 4 (Centerview).

9
E. Aftermath of the Purported Oral Agreement

1. First Communications

The day after the purported oral agreement, Handler and Effron exchanged

40
Handler responded , We need to absorb

41
A month later on

December 16, 2012, St. Jean sent an email to Pruzan and copied Handler stating:

the lines we have been discussing . . . we are not done working through the details
42
The email further stated,
43
. . we will stand with you [] to invest capital . . .

Afterwards, Handler sent the proposed term sheet to his attorney, stating, to
44
In

addition, St. Jean and Handler exchanged drafts of the proposed term sheet with

revisions.45 On December 14, 2012, St. Jean sent Handler an updated term sheet.46

40
JX54.
41
Id. at 2.
42
JX138.
43
Id.
44
JX55.
45
Id.
46
JX62.

10
The revised draft included new governance rights and, under receipt of profit points,

, with another note stating that
47

2. The Parties Exchange Numerous Draft LPAs

On January 8, 2013, Handler wrote the Founders via email stating he wanted

in the similar spirit that [the
48
Founders] laid . . . In that same email, Handler requested to

49

Handler prepared an agenda for a January 25, 2013 meeting in which the

Founders and Handler were to discuss a written partnership agreement.50 The topics

for the agenda included David St. Jean] response to [the
51
Handler also

prepared a chart to facilitate this meeting.52 The chart listed terms that were agreed

upon between the parties, while also listing terms that were still under discussion.53

For example, [the Founders]

47
Id. at 6.
48
JX74 (emphasis added).
49
JX74; see also JX79; Tr. 111:8 114:23 (Handler).
50
JX79.
51
Id.
52
JX81.
53
Id. at 4.

11
54

For several more months, the parties carried on business as usual without

executing a partnership agreement. For instance, the parties met again to discuss a

partnership agreement in March 2013, but , the 2008

Letter, i.e. the employment agreement, remained operative, as evidenced in a

memorandum detailing the meeting.55 A month later, in an email to a third-party

organization, where Handler chairs the board of directors, Handler expressed that he

still had not signed partnership agreements with Centerview.56 Again two months

later, Handler, in an email to his accountant, expressed that the partnership

agreement had not been executed.57 In response to receiving a revised written

partnership agreement from St. Jean, Handler responded:
58

Following the Founders proposing the concept of admitting Handler and St.

Jean to the partnership, arising as of 2012, the parties never signed a written

agreement. They continued to exchange drafts of the partnership agreement

throughout the end of 2013.59 On October 18, 2013, Handler sent a partnership

54
Id.
55
JX88 at 4.
56
Tr. 94:4 10 (Handler); JX93.
57
JX97.
58
JX103.
59
JX103; JX125.

12
agreement with revisions to the Founders and St. Jean.60 The email, to which the

agreement was attached, mentioned the November 8th Meeting, among others, and
61
The

today. From
62
a day-to-

p agreement

and themselves executed the Topco ,

converting Centerview Partners Holdings LLC into Topco on November 19, 2013.63

The Topco LPA did not include Handler and St. Jean as limited partners of Topco.64

Nevertheless, the Founders continued to seek to add Handler and St. Jean to the

Topco partnership by sending Handler a revised draft limited partnership agreement

to sign on May 18, 2014.65

limited partnership

agreement

this Agreement in connection with the admission of additional limited partners and

60
JX125.
61
Id.
62
Id.
63
JX126; JX135.
64
JX126; JX135.
65
JX169; JX170; JX171.

13
limited partnership agreement.66 In response, Handler
67

3.

After the November 8th Meeting

increased,68 but his compensation continued to be recorded through W-2 forms.69

remained subject to year-end negotiations with the Founders.70 The Founders had

discretion to implement compensation principles flexibly, purportedly in a manner

that benefited the firm and addressed issues for specific employees.71

For example, at a certain time,
72
As a result, the

to perform according to expectations in 2015,73 causing Centerview to absorb the
74
Handler also received Priority Capital Amounts as

66
JX170 at 006.
67
JX171.
68
Tr. 361:5 19 (Pruzan); see, e.g., Tr. 139:19 142:15, 387:5 20, 388:1 4 (Centerview).
69
See JX163; Tr.154:13 155:11 (Handler).
70
Tr. 348:2 4, 406:4 9 (Pruzan); JX300 (anticipating year end compensation discussion by
detailing methodology for compensation).
71
JX250 at 3. . . . firm minus
. . . adjusted for the profit points allocated to all other teams vs
their annual contribution. Id. at 2.
72
JX352 at Tab 2013 Cell E:20, Tab 2014 Cell E:21, Tab 2015 Cell E:21; JX 250 at 492; JX 260.
73
JX250 at 492; JX260.
74
JX250 at 492.

14
part of his compensation from 2012 2015.75 But, Handler did not receive Priority

Capital Amounts after 2015.76

In the next year, Pruzan provided Handler with a compensation proposal that

did not include priority amounts, but gave Handler a maximization of cash payouts.77

In response, Handler submitted a compensation proposal, which set forth two

principal terms for deliberation but did not demand a deferral of the Priority Capital

Amounts.78 Eventually, in a 2018 compensation proposal to Handler, Pruzan

informed Handler that Centerview would no longer give profit gross ups to the Tech

Team.79

for three years, and did not express that his lack of participation violated an oral

partnership agreement.80

4. Handler Elects to Receive TVIs in CPAH

During negotiations in 2013, Handler elected to receive TVIs in CPAH the

Topco subsidiary via a 83(b) form pursuant to the 2008 Letter.81 The 83(b) form,

75
JX319 at 2.
76
JX249; see, e.g.
compensation tracker did not reflect priority amounts after 2015).
77
JX 250 at 493; Pruzan Dep. 179:2 19.
78
JX262.
79
JX301 at 490.
80
JX318.
81
JX23; First Handler Dep. 102:9 22; JX 129. As mentioned previously, the TVIs in CP LLC did
not reflect ownership interest in the firm, profits or losses, or governance rights.

15
to which Handler was a signatory, provided that [u]pon termination of service, the

Interest is subject to repurchase by the Company. 82 A memorandum attached to the

83(b) form also specified that

interests for the original fair market value as of the grant date, plus 2.5% per annum
83
thereon, upon a termination of [Ha This language

coincided with the specifications concerning the TVIs that was originally referenced

in the 2008 Letter, under which Handler was an employee, not a partner.84

After his election, Handler began to receive Schedule K-1s, which recorded

his TVIs in CPAH, but not in Topco.85 To third parties, Handler represented and

disclosed that his TVIs were in CPAH, by providing them with those Schedule K-

1s.86 In 2018, Handler sought information concerning his interests in Centerview.87

Terminal Interests (B
88
Handler did

not express an opposition upon receipt of this information.89

82
JX129 at 066.
83
Id. at 067.
84
Id.
85
Tr. 155:12 20 (Handler).
86
JX186 at 2 (Handler sent Schedule K-1 to accountant); JX345 at 2 (Handler sent CPAH 83(b)
form to regulators); Tr. 153:10 154:2 (Handler) (admitting that he did not disclose he held Topco
interests to gaming regulators).
87
JX304.
88
JX302 at 2.
89
JX304; Tr. 152:3 10 (Handler).

16
5. Events Leading to the Books and Records Demand Letter

From the November 8th Meeting up until 2022, Handler did not express an

intent to leave the Company.90 In fact, Handler relocated his family to Silicon Valley

to open a Centerview office, which prevented the firm from hiring a lateral partner

to do so.91 However, on January 2, 2022, Handler voiced concerns to the Founders

about his compensation via email.92 Handler asserted that his compensation was

. . . and . . . the 2008
93
[employee] [ The email did not mention the purported oral

partnership agreement in Topco.

Handler served a books and records demand on Topco, CPAH, and CP LLC

on May 23, 2022.94 Centerview

a partner of Topco, and therefore was not entitled to books and records on May 31,

2022.95 Thereafter, the parties engaged in numerous communications in

disagreement from June 3, 2022, to July 15, 2022.96 Handler resigned from the

Company on August 1, 2022.97

90
PL PT OB 29 (citing JX74); see also JX79; Tr. 111:8 114:23 (Handler).
91
Tr. 77:18 79:18, 120:10 121:16 (Handler).
92
JX377.
93
Id. at 2.
94
PTO ¶ 24.
95
Id. ¶ 25.
96
Id. ¶¶ 26 30.
97
Id. ¶ 18.

17
F. Procedural Background

On August 1, 2022, Handler filed a complaint pursuant to 6 Del. C. § 17-305

to enforce the books and records demand served upon Topco on May 23, 2022, along

with a motion to expedite .98 Defendant filed its

answer on August 30, 2022.99 Defendant had previously filed a complaint in this

Court in a separate action seeking a declaratory judgment that Handler was not a
100
partner of Topco (the Handler filed his answer and

counterclaims on October 4, 2022.101 Soon after, Topco filed a motion for judgment

on the pleadings in the Books and Records Action.102 On November 3, 2022, I held

a scheduling conference and stayed the Plenary Action and bifurcated the Books and

Records Action to first determine the validity of Handler is a

partner of Topco .103

Topco filed a renewed motion for judgment on the pleadings on November 8,

2022.104 On January 9, 2023, Handler filed a motion to compel production of

98
Verified Compl. Pursuant to 6 Del. C. Section 17-305 to Compel Inspection of Books and
Records, Dkt. No. 1.
99
Def. ., Dkt. No. 9.
100
Centerview P rs Hldgs. LP v. Handler, C.A. No. 2022-0767-SG, Dkt. No. 1. Handler filed his
Answer and Counterclaims on October 5, 2022. Dkt. No. 18.
101
Centerview P rs Hldgs. LP v. Handler, C.A. No. 2022-0767-SG, Answer and Countercl., Dkt.
No. 17.
102
Def.s Mot. for J. on the Pleadings, Dkt. No. 12.
103
Tel. Scheduling Conf., Dkt. No. 32.
104
Def. . for J. on the Pleadings, Dkt. No. 36.

18
documents and information from Defendant.105 Magistrate judge Bonnie W. David

recommended that the motion be granted in part and denied in part in a Final Report

and Recommendation on February 13, 2013.106 Handler filed a letter to Magistrate

David to seek relief in connection with the February 13, 2023 Order,107 which Topco

opposed.108 Magistrate David held argument on the issues and delivered a Final

Report and Recommendation in a bench ruling on February 28, 2023.109

On March 3, 2023, Topco filed a motion for a protective order110 and notice

of e February 28, 2023 Final Report,111 with Handler

filing his oppositions on March 8, 2023.112 The Court heard oral argument on the

motion and exceptions on March 9, 2023, and issued a bench ruling granting in part

and denying in part the motion but adopting the Magistrate Final Report with

modification.113

105
Pl.'s Mot. to Compel Prod. of Docs. and Info. from Def., Dkt. No. 61.
106
Adopting Order, Dkt. No. 92.
107
Letter to The Hon. Bonnie W. David from Elisabeth S. Bradley Regarding Order Granting Mot.
to Compel, Dkt. No. 91.
108
Letter to The Hon. Bonnie W. David from Michael A. Barlow on behalf of Def. Centerview
P rs Hldg. . 24, 2023 letter, Dkt. No. 93.
109
Teleconference Status before Master Bonnie David on 2.28.2023 re: The Master delivered a
final report under Rule 144 on discovery issues. Dkt. No. 94.
110
Centerview P rs Hldgs. LP's Mot. for a Protective Order, Dkt. No. 98.
111
Centerview P rs Hldgs. LP's Notice of Exceptions to the Master's Feb. 28, 2023 Final Report,
Dkt. No. 99.
112
Pl. David Handler's Opp n to Centerview P rs Hldgs. LP's Mot. for a Protective Order, Dkt.
No. 107; Pl. David Handler's Opp n to Centerview P rs Hldgs. LP's Exception to the Master's
Report, Dkt. No. 109.
113
Hr g on Exceptions to Master's Ruling and Mot. for Protective Order on 3.9.2023 before Vice
Chancellor Laster- Mot. granted in part and denied in part, Dkt. No. 114.

19
Centerview filed a motion for continued confidential treatment on June 30,

2023,114 which was opposed by Handler.115 Thereafter, on July 12, 2023, Handler

filed his motion for sanctions against Defendant,116 with Defendant opposing the

motion.117 I held an evidentiary hearing in this action on July 25, 2023 and July 26,

2023.118 I heard post-trial oral arguments on the Standing Issue, motion for

sanctions, and motion for continued confidential treatment on November 7, 2023.119

I took the matter under advisement that day.120

This Memorandum Opinion solely addresses the Standing Issue, and other

non-related motions will be addressed in a separate letter opinion, to the extent

necessary. To the extent that those motions seek sanctions in the form of certain

inferences in favor of Handler, I have not identified a circumstance where such an

inference, supported by equity, would change my decision here.

II. ANALYSIS

Before me is

status within Centerview, as either a partner or employee. In dispute is a purported

oral partnership agreement as alleged by Handler, that establishes his status as a

114
Centerview P rs Hldgs. . for Continued Confidential Treatment, Dkt No. 157.
115
Pl.'s Opp n to Def s Mot. for Continued Confidential Treatment, Dkt. 161.
116
Pl.'s Mot. for Sanctions, Dkt. No. 164.
117
Centerview P rs Hldgs. . for Sanctions, Dkt. No. 184; Pl.'s Reply
in Further Supp. of His Mot. for Sanctions, Dkt. No. 186.
118
Trial before Vice Chancellor Sam Glasscock dated 7.25.23 through 7.26.23, Dkt. No. 189.
119
Closing Arg. Post Trial before Vice Chancellor Sam Glasscock dated 11.7.23, Dkt. No. 219.
120
Id.

20
partner in Topco. Plaintiff has the burden of proving each element of the oral

partnership agreement by a preponderance of the evidence.121 This standard of proof

requires that the evidence shows that the fact at issue is more likely than not.122 I

find that Handler has not met this burden and that the record demonstrates that

Handler was an employee when he left his employment with Centerview on August

1, 2022.

A. Plaintiff Fails to Overcome his Burden to Establish there was an Oral
Partnership Agreement Creating his Partnership in Topco

Handler asserts that the November 8th Meeting resulted in an oral agreement

to create a limited partnership in Topco.123 Handler further asserts that the parties

operated and performed in accordance with the purported oral partnership

agreement.124 Defendant, in turn, contends that the November 8th Meeting did not

result in an oral partnership agreement.125 Defendant also contends that Handler did

121
Grunstein v. Silva, 2014 WL 4473651, at *16 (Del. Ch. Sept. 5, 2014), aff'd, 113 A.3d 1080 (Del.
2015), and aff'd sub nom. Dwyer v. Silva, 113 A.3d 1080 (Del. 2015). Although the issue here is simply
whether Handler is a partner of Topco for purposes of the books-and-records statute, the matter is akin
to a specific performance of the supposed oral partnership agreement, which would require clear and
convincing evidence from Handler. Osborn ex rel. Osborn v. Kemp, 991 A.2d 1153, 1158 (Del. 2010)
(holding that [a] party must prove by clear and convincing evidence that he or she is entitled to specific
performance . . . . The parties in briefing have asserted that the standard of evidence is
preponderance, however, and for purposes of this Memorandum Opinion, I accept and apply that
standard.
122
Id.
123
Pl. -Trial Br. on the Standing Issue OB 24 27, Dkt, No. 202
PL PT OB .
124
Id. at 27 32.
125
Def. -Trial Opening Br. 12 15, Dkt. No. 201 DF PT OB .

21
not assert that the oral partnership agreement existed until this present litigation

ensued.126

Pursuant to traditional partnership principles, a partnership is created by the

association of [two] or more persons (i) to carry on as co-owners a business for profit

form a partnership, whether or not the persons intend to form a partnership, and (ii)

to carry on any purpose or activity not for profit, forms a partnership when the

persons intend to form a partnership. 127 Under Delaware law, a limited partnership

128
affairs of a limited partnership and the conduct of its

entered into or otherwise existing either before, after or at the time of the filing of a
129
is a question

of intent. 130 A partnership exists if the
131
Traditional contract principles apply to partnership

agreements, as such a partnership agreement is only enforceable if it contains all

material terms.132

126
Id. at 33.
127
6 Del. C. § 15-202(a).
128
6 Del. C. § 17-101(14).
129
See 6 Del. C. § 17-201(d).
130
Grunstein v. Silva, 2011 WL 378782, at *9 (Del. Ch. Jan. 31, 2011) (quoting Hynansky v. Vietri,
2003 WL 21976031, at *5 (Del. Ch. Aug. 7, 2003)).
131
Id. at 9 (quoting Ramone v. Lang, 2006 WL 905347, at *12 (Del. Ch. Apr. 3, 2006)).
132
Id.

22
Under Delaware law, an enforceable contract exists when (1) the parties have

made a bargain with sufficiently definite terms; and (2) the parties have manifested

mutual assent to be bound by that bargain. 133 M

objectively based upon the[ ] [parties'] expressed words and deeds as manifested at
134
the time rather than by their after-the-

Therefore, the Court must determine hether a reasonable negotiator in the position

of one asserting the existence of a contract would have concluded, in that setting,

that the agreement reached constituted agreement on all of the terms that the parties

themselves regarded as essential and thus that agreement concluded the negotiations

. . . . 135 A contract is not required to be in writing in order to be enforceable

the objective, contemporaneous evidence indicates that the parties have reached an

agreement, they are bound by it, regardless of its form or the manner in which it was
136

Here, the objective contemporaneous evidence demonstrates that Handler and

Centerview did not reach an agreement on the essential terms to create a partnership

in Topco at the November 8th Meeting. It is clear that the Founders of Topco wished

to bring in Handler and St. Jean as partners. Prior to the November 8th Meeting,

133
Sarissa Cap. Domestic Fund LP v. Innoviva, Inc., 2017 WL 6209597, at *21 (Del. Ch. Dec. 8,
2017) (quoting Osborn ex rel. Osborn, 991 A.2d at 1158).
134
Id. (quoting Debbs v. Berman, 1986 WL 1243, at *7 (Del. Ch. Jan. 29, 1986)).
135
Id. (quoting Leeds v. First Allied Conn. Corp., 521 A.2d 1095, 1097 (Del. Ch. 1986)).
136
Id. (quoting Debbs, 1986 WL 1243, at *7).

23
Handler was considered an employee pursuant to the 2008 Letter. The Founders

proposed terms for establishing a partnership with Handler before the November 8th

Meeting, which were not acceptable to Handler.137 Handler and St. Jean proposed
138
At the November 8th

M
139

Handler asserts that this meeting created a partnership in Topco. 140 The

evidence offered into the record, however, belies this. To the extent the term sheet

was an offer by the Founders to create a partnership with Handler, Handler did not

accept. After the meeting, Handler sent the Founders an email stating,

This, I find, is

strong evidence that an agreement was not reached at the November 8 th Meeting.141

At trial, Handler characterized what took place at the November 8th Meeting as an
142

Other email exchanges in the weeks after the November 8th Meeting, among

the Founders, Handler, and St. Jean strongly indicate that neither Handler nor St.

137
Tr. 29:14 15, 30:15 31:1 (Handler).
138
Tr. 246:24 247:4, 253:10 19 (Handler).
139
Tr. 361:5 19 (Pruzan).
140
PL PT OB 24 27.
141
JX54 at 2.
142
Tr. 168:16 23, 246:21 4, 253:7 13 (Handler).

24
Jean considered that they had entered an oral partnership agreement. For example,

on November 15, 2012, Handler sent the proposed term sheet to his attorney, stating,
143
In

addition, on December 16, 2012, St. Jean wrote to Pruzan and with Handler copied

stated

along the lines we have been discussing . . . we are not done working through the
144
Importantly, when Handler first expressed his

displeasure with his pay in 2022, he sent an email to Pruzan and Effron stating his

. . . and
145
... He did not reference the purported

oral partnership agreement in Topco.146

Notably, several material terms were still up for discussion throughout the

years-long exchange of draft LPAs following the November 8th Meeting.147

The parties also did not perform in accordance with the terms identified in the

purported oral partnership agreement.148

143
JX55.
144
JX 138.
145
JX377.
146
Id. at 2.
147
See JX62; JX79; JX125.
148
Compare JX318 (stating that Handler had not participated in the Priority Capital Amounts for
three years); JX250 (evidencing compensation were subject to the Founders and
compensation proposals) , with JX52;
Tr. 51:10, 174:1 175:6 (Handler); Tr. 38:4 45:15, 54:15 55:1 (Handler); JX474 ¶18; JX413 at
No.16 (showing purported terms from the purported oral partnership agreement).

25
remained at the discretion of the Founders, and not the terms set forth in the

purported oral partnership agreement.149 In fact, when his compensation did not

coincide with the purported oral partnership agreement, Handler did not assert or

express his rights under the purported oral partnership agreement.150 For instance,

once Handler made an 83(b) election he began to receive Schedule K-1s, which

reflected interests in CPAH, not Topco; he did not dispute the classification.151

In addition, during , before making his 83(b)

compensation was reflected through W-2s, demonstrating that

Handler was in fact an employee, and not a traditional partner.152 Notably, Handler

never signed the LPA agreement, which, that document provides, is a requirement

to form the partnership.153 In a similar vein, Handler represented to third parties that

an agreement regarding the partnership had not been reached, evidencing that the

parties were still in discussions regarding a partnership agreement and nothing

149
JX250.
150
For example, in a response to a compensation proposal, Handler expressed an interest in
a term that Handler claims the parties agreed to
in the purported oral partnership agreement, Handler acknowledged that he had not participated in
it for three years and did not express that such violated an oral partnership agreement. JX318.
151
Handler argues that a lack of receiving Schedule K-1s is not indicative of a lack of an oral
partnership agreement. PL PT AB 48 51 (citing Robinson v. Darbeau, 2021 WL 776226, at *9
(Del. Ch. Mar. 1, 2021); Cianci v. JEM Enter., Inc., 2000 WL 1234647, at *2 (Del. Ch. Aug. 22,
2000)). I find that the record demonstrates that an oral partnership agreement was not reached
between the parties; the lack of a Schedule K-1 is not determinative and is only a part of the
evidence that I find predominates.
152
See JX163; Tr. 154:13 155:11 (Handler).
153

listed on the signature pages hereto . . . (responding to St. Jean in an email
).

26
pertaining to the agreement had been fully executed. 154 Handler asserts that these

communications merely evidence that either there was no written agreement to

provide or that Topco had not been formed at that time.155

not persuasive. I find that under a reasonable interpretation the third-party

communications evidence that the partnership agreement was still under discussion,

and not consummated. These include email to a third-party organization,

of which Handler chairs the board of directors, expressing that he still had not

entered partnership agreements with Centerview,156

accountant, stating that the partnership agreement had not been reached.157

Handler offers numerous arguments to support the creation and execution of

the purported oral partnership agreement, none of which, in my view, are persuasive

or sufficient to satisfy his burden.158 First,

154
Tr. 94:4 10 (Handler); JX93 (expressing to a company, where he chaired the board of directors,
that he still had not signed partnership agreements with Centerview); JX97 (emailing his
accountant and expressing that the partnership agreement had not been executed).
155
Id.
156
Tr. 94:4 10 (Handler); JX93.
157
JX97.
158
Handler makes further arguments based on the Topco LPA, which is a written agreement that
he did not enter.

PL PT OB 37.
opinion, supports his argument that he is a partner of Topco, because the LPA provided for this

to the Partnership:

27
demonstrate that the oral partnership agreement existed.159 Handler argues that

operational proceeds, which in his view, was consistent with the terms that the

parties agreed to at the November 8th Meeting.160 Similarly, Handler contends that

the Topco 2012 Ledgers also Capital

,

accounts that were otherwise only held by Effron and Pruzan, the founding

partners.161 The record evidences that the spreadsheets are not, and were never,
162
Rather, the spreadsheets that

Handler reference track economic interests across the full Centerview organization,

admission to the Partnership, such Partner shall be deemed to have made Capital
Contributions to the Partnership with respect to such contributed, exchanged, or
Id.;
JX135 § 1.5(a).

I find that the evidence does not support his assertion, as the record indicates that the other two
individuals mentioned are themselves not partners, but employees, of Topco, who do not enjoy
governance or control rights at Topco. Tr. 368:11 15; 403:11 17 (Pruzan) (stating Hartman and

159

JX271 (2016); JX307 (2017); JX329 (2018); JX343 (2019); JX393 (2020); JX421 (2022)).
160
Id. at 34.
161
Id. 35.
162
Vicari Aff. ¶ 3.

28
and thus are

partner.163 They are evidence in support of a partnership, but not strong evidence.

Handler further contends that

recorded Handler

well as Topco Class B Units.164

is a Topco partner. I find that the record evidences that

Jeanne Vicari,

negotiations, to demonstrate what schedules to the LPA

might have looked like if the parties had come to a partnership agreement.165 But,

because Handler and St. Jean never executed a written partnership agreement, that

finalized.166

Handler and St. Jean had no

interests as of 2013, since the spreadsheet contains --

. 167

163
See Vicari Aff. ¶¶ 4, 9; Centerview Tr. 252:9 10 (Pruzan testifying that Vicari keeps these
id. at 263:17 19 (Pruzan testifying:
This is a page that represents the
164
PL PT OB 39.
165
Vicari Aff. ¶ 5; JX72.
166
Id.
167
JX161.

29
Handler also points to 2014 22 ledger records, which reflected that

he . Handler further argues those

ledgers also recorded that he

three additional fiscal years after the November 8th Meeting, and continued to hold

, which accrued interest

until he left in 2022.168

partnership.169 According to Handler, receipt of Topco Priority Capital Amounts

and Priority Capital Accounts

not a partner of Topco.170

Amounts and TVIs. First, simply receiving economic interests does not provide that

a partnership exists.171 As I have previously found, Handler did not share in losses

168
JX217; .
169
Pl. -Trial Br. on the Standing Issue 16, Dkt. No. 211 (citing
. Corp., 906 A.2d 218, 230 (Del. Ch.
June 29, 2006); Bamford v. Penfold, L.P., 2020 WL 967942, at *17 (Del. Ch. Feb. 28, 2020); 6
Del. C. § 17-101(15)).
170
PL PT OB 42.
171
See Grunstein, 2014 WL 4473641, at *23 (holding that a partnership did not exist where
plaintiff did not have control and ownership in the purported partnership); see also Silva, 2011 WL
378782, at *9 (A partnership exists if parties have a common obligation to share losses as well as

30
with Centerview and did not have governance rights, indicating that a partnership

did not exist. Priority Capital

Amounts were a part of his annual compensation discussions, which were subject to

and not provided by the purported oral partnership

agreement.172

Again, the documentary evidence pointed to by Handler is some evidence of

an oral partnership, but not strong evidence. To the extent that this documentary

evidence supports Handler contention that an oral partnership agreement was

reached at the November 8 Meeting,173 I find that it is insufficient to rebut the record

that supports a finding that the parties did not come to an agreement for all of the

reasons previously listed.174

Handler, relying on Grunstein,175 also argues that the exchange of various

draft LPAs is not conclusive that the parties did not come to an oral partnership

profits.); see generally 6 Del. C. § 15-202 (c)(3)(ii) (providing that an employee sharing profits
does not create a presumption of partnership)).
172
See JX250 at 3; JX249; JX352 at 2016 Tab Cell E:35, 2017 Tab Cell E:35 (showing that
capital amounts after 2015).
173
Centerview asserts that these entries were placeholders, and, as I found above, this
characterization is credible. Vicari Aff. ¶ 5; JX72.
174
See Pogue v. Hybrid Energy, Inc., 2016 WL 4154253, at *1 (Del. Ch. Aug. 5, 2016) (finding
inclusion on the stock ledger states a prima facie, but rebuttable, case that a plaintiff is a
statutory stockholder of record; and that, here, the undisputed record rebuts that presumption,
precluding Pogue from the relief he seeks.
175
Id. at *10 (holding on summary judgment
agreements does not indicate as a matter of law that the parties never reached a different

31
agreement at the November 8th Meeting.176 Handler is correct, but his reliance on

Grunstein is unpersuasive. The exchange of draft LPAs is not conclusive but

supportive of my finding that the parties did not agree to the essential terms of an

oral partnership agreement, as evidenced by continued negotiations and unsuccessful

attempts to alter the original proposal over a period of time.177

In addition, Handler points out that he had expressed his displeasure at his

compensation and lack of ownership and argues that his remaining at Centerview

after voicing his discontent demonstrates that the parties must have reached an oral

partnership agreement at the November 8th Meeting.178 Before the November 8th

Meeting, however, Handler and St. Jean sent the Founders an addendum to the 2008

Letter, which addressed their compensation.

was consistent with the addendum to the 2008 Letter. After the November 8th

Meeting, when Handler addressed his compensation issues with the Founders, he

asserted compensation rights provided by the 2008 Letter, instead of the purported

oral partnership agreement.179 As such, I find that the record demonstrates that the

compensation, post the November 8th Meeting, merely indicate

176
PL PT OB 5; Grunstein, 2011 WL 378782, at *9.
mutual assent are also unpersuasive since they concern actions where an oral partnership
agreement was not in dispute or involve evidence of executed written agreements. See PL PT OB
4 6.
177
Grunstein, 2014 WL 4473641, at *19.
178
PL PT OB 18 20, 29 30.
179
JX377 at 2 (asserting
standard . . . and . . . ).

32
Handler accomplished his purpose at the meeting, to increase his compensation at

Centerview, which explains his continuing presence at the firm.

Overall, however, I find that the evidence falls short of demonstrating an oral

partnership agreement, and Plaintiff has not met his burden. Therefore, I conclude

that when Handler left his employment in 2022, he was an employee with certain

vested rights in Centerview (to be determined in the Plenary Action) but was not a

Topco partner entitled to invoke 6 Del. C. § 17-305.

III. CONCLUSION

For the foregoing reasons, I find that Plaintiff is not a partner of Topco and

therefore not entitled to books and records under 6 Del. C. § 17-305. The parallel

litigation, the Plenary Action, should proceed. To the extent motions in this books-

and-records action need resolution, the parties should so inform me. The parties

should submit a form of order consistent with this Memorandum Opinion.

33