Ney v. 3iGroup PLC

IN THE SUPERIOR COURT OF THE STATE OF DELAWARE

S. CHRISTOPHER NEY, )
)
Plaintiff, )
)
v. ) C.A. No. N24C-08-357 PAW CCLD
)
3i GROUP PLC, and 3i )
CORPORATION, )
)
Defendants. )

Submitted: February 4, 2025
Decided: May 21, 2025

MEMORANDUM OPINION

Upon Consideration of Defendants’ Motion to Dismiss;

GRANTED.

Samuel T. Hirzel, II, Esq.; and Brendan Patrick McDonnell, Esq., of Heyman Enerio
Gattuso & Hirzel LLP, Attorneys for Plaintiff.

Adam D. Gold, Esq.; and Thomas C. Mandracchia, Esq., of Ross Aronstam & Moritz
LLP; Martin L. Roth, Esq.; Katie R. Lencioni, Esq.; and Amanda Lamothe-Cadet,
Esq., of Kirkland & Ellis LLP, Attorneys for Defendants.

WINSTON, J.
I. INTRODUCTION

Plaintiff S. Christopher Ney initiated this litigation against Defendants 3i

Group PLC and 3i Corporation on August 28, 2024, alleging breach of an agreement

between Ney and Defendants. In 2018, Ney served as the CEO of Magnitude and

engaged in negotiations with several private equity funds and investment companies

concerning a potential sale of Magnitude. Ney specifically alleges that Defendants

made a promise in 2019 to pay him $20 million in exchange for Ney: (1) keeping

Defendants at the front of the line during the negotiations process; (2) remaining as

CEO after the sale to see Defendants through the post-acquisition period; and (3)

building out a revamped company post-acquisition. Ney brings a claim for breach

of contract (“Count I”), or, in the alternative, promissory estoppel (“Count II”) and

unjust enrichment (“Count III”). The Defendants move to dismiss Ney’s Complaint

pursuant to Delaware Superior Court Civil Rule 12(b)(6) (the “Motion”).

2
II. FACTUAL AND PROCEDURAL BACKGROUND1

A. RELEVANT FACTS

Plaintiff Christopher Ney co-founded Magnitude, a software firm, in 2014

with the objective to further acquire companies.2 Ney also served as the CEO of

Magnitude, which had its principal place of business in Travis County, Texas.3 In

2018, Magnitude entered negotiations with several private equity funds and

investment companies concerning a potential sale of the company.4 One of those

potential buyers was Defendant 3i Group PLC, an international private equity

group.5

Ney alleges he negotiated with the Defendants regarding a potential sale

throughout 2018 and 2019.6 During these negotiations, Ney communicated

primarily with Andrew Olinick, who was under the supervision of Simon Borrows,

1
The following facts are drawn from the Complaint and documents incorporated by
reference. Windsor I, LLC v. CW Capital Asset Mgmt. LLC, 238 A.3d 863, 873 (Del.
2020). Citations in the form of “Ex. __” refer to documents attached to the
Complaint.
2
Complaint (hereinafter “Compl.”) ¶ 14.
3
Compl. ¶ 14.
4
Compl. ¶ 15.
5
Compl. ¶ 15.
6
Compl. ¶ 15.
3
the CEO of 3i Group.7 Olinick held himself out as a 3i Group partner, co-head of

North American Private Equity, and Global Head of Business and Technology, but

now claims to have been acting on behalf of a related corporation, Defendant 3i

Corporation.8 Because of this, Ney brings his claims against both 3i Group and 3i

Corporation (collectively, the “Defendants”).

During the negotiations, Olinick repeatedly pressed Ney to put the Defendants

at the “front of the line” of the entities negotiating for a possible purchase of

Magnitude.9 Borrows and Olinick told Ney late in the process that although the

Defendants had previously committed to a firm purchase price of $360 million, their

investment committee now could only commit to a $340 million purchase price.10

Ney responded to Olinick that $340 million was not acceptable and that Magnitude

was going to open negotiations to other interested suitors.11 In turn, Borrows and

Olinick requested that Ney provide exclusivity to the Defendants during the

negotiations process.12

7
Compl. ¶ 3.
8
Compl. ¶ 3.
9
Compl. ¶ 16.
10
Compl. ¶ 16.
11
Compl. ¶ 17.
12
Compl. ¶ 18.
4
Ney alleges that, during negotiations of the sale of Magnitude, Borrows and

Olinick offered to pay Ney $20 million post-closing in exchange for Ney staying on

as CEO of Magnitude to steer the new equity group through the post-acquisition

period and set Magnitude up for continued growth and success.13 Ney accepted the

Defendants’ offer; as agreed, he pushed the negotiations to a successful close;14

stayed on as Magnitude’s CEO; completely revamped the company’s management,

products, and marketing strategy; and, overall, successfully transitioned the

company post-closing.15 Ney refers to this agreement as the “Post-Closing

Agreement.”16

In March 2019, New Amsterdam Software Holdings purchased Magnitude for

$340 million.17 On or about July 7, 2020, approximately 18 months after the sale

13
Compl. ¶¶ 18-21.
14
See Compl. ¶¶ 7, 16, 18, 23. At times Ney alleges that the Post-Closing Agreement
included his promise to keep Defendants “at the front of the line during the
negotiations process.” Ney alleges that the Post-Closing Agreement was first
proposed before the sale of Magnitude was completed, and Ney’s Complaint
mentions multiple times that Ney performed his promise to Borrows and Olinick to
prioritize the Defendants over other potential buyers. Compl. ¶¶ 18, 23.
Accordingly, the Court will consider this promise to be a part of the alleged Post-
Closing Agreement. Excluding this commitment would not alter the Court’s
decision.
15
Compl. ¶¶ 22-23.
16
Compl. ¶¶ 18-21.
17
Compl. ¶¶ 5-7, 23; see also Ney v. 3i Group, P.L.C., 2023 WL 6121774, at *2 (5th
Cir. Sept. 19, 2023).
5
was completed, Ney was terminated as CEO of Magnitude.18 Ney alleges that this

termination was intentionally timed “after Ney had completed all aspects of his end

of the Post-Closing Agreement—and thus right when [the Defendants] would

understand that Ney would insist that he be paid the $20 million as promised.”19

In summary, Ney alleges that the Defendants used Ney and terminated him as

CEO of Magnitude shortly before the subsequent sale of the company for a large

profit—a sale which, Ney alleges, would not have occurred if it was not for his

efforts as CEO.20

B. PROCEDURAL POSTURE

1. THE INITIAL ACTION

Ney initially filed suit in a Texas state court against New Amsterdam Software

Holdings and New Amsterdam Software GP LLC (collectively the “New

Amsterdam Entities”), and 3i Group.21 The New Amsterdam Entities moved to

dismiss based on forum selection clauses in the written contracts between the parties

(collectively, the “Transaction Agreements”)22 that unambiguously provided

18
Compl. ¶ 24.
19
Compl. ¶ 24.
20
Compl. ¶ 24.
21
Ney v. 3i Group, P.L.C., 2023 WL 6121774, at *2.
22
See id. The Transaction Agreements are seven fully integrated written agreements
governing the sale of Magnitude. D.I. 22 (hereinafter “Op. Br.”) at 1. These
6
Delaware as the exclusive forum for resolving disputes relating to the Magnitude

negotiation and purchase.23

Although the New Amsterdam Entities noted in their motion to dismiss that

the Transaction Agreements would likewise prohibit claims against 3i Group, 3i

Group was not subject to the motion to dismiss.24 Instead, 3i Group had filed a

contemporaneous Special Appearance challenging the Texas court’s jurisdiction.25

On October 20, 2020, the Texas state court granted the New Amsterdam Entities’

motion to dismiss based upon the forum selection clauses.26 The only remaining

defendant to the action was 3i Group.27

documents are attached as exhibits to the Defendants’ Motion to Dismiss and
include: (i) the Stock Purchase Agreement, Ex. 2; (ii) the Restrictive Covenant
Agreement, Ex. 3; (iii) two Incentive Grant Agreements, Ex. 4-5; (iv) the
Contribution and Subscription Agreement (the “Rollover Agreement”), Ex. 6; (v) the
Agreement of Limited Partnership (the “Partnership Agreement”), Ex. 7; and (vi)
the Limited Liability Company Agreement, Ex. 8. The Stock Purchase Agreement
is incorporated by reference into Restrictive Covenant Agreement and the Rollover
Agreement. The Partnership Agreement is incorporated by reference into Exhibits
4, 5, 6, and 8. See Op. Br., Ex. 2-8.
23
Ney v. 3i Group, P.L.C., 2023 WL 6121774, at *2.
24
Id.
25
Id.
26
Ney v. 3i Group, P.L.C., 2023 WL 6121774, at *2; see also Ney v. 3i Group, P.L.C.,
2021 WL 8082411, at *2 (W.D. Tex. Apr. 13, 2021).
27
Ney v. 3i Group, P.L.C., 2023 WL 6121774, at *2.
7
Following the Texas state court’s dismissal of the New Amsterdam Entities,

Ney amended his petition to add 3i Corporation as an additional defendant, bringing

the total number of defendants to two: 3i Group and 3i Corporation. 28 Ney

contended that he was owed $20 million under an oral contract and asserted breach

of contract, promissory estoppel, and unjust enrichment/quantum meruit claims

against the Defendants.29 The case was removed to federal court based on diversity

and referred to a District Court magistrate for a report and recommendation on

dispositive motions.30 The Defendants filed their motion to dismiss on December 4,

2020, arguing that Ney’s claims should be dismissed because: (1) his pleadings

failed to state a claim under Rule 12(b)(6), (2) venue was improper given the various

written agreements’ forum selection clauses under Rule 12(b)(3), and (3) the court

lacked personal jurisdiction over 3i Group.

The magistrate granted the Defendants leave to file a supplemental motion to

raise the forum selection clause argument in a forum non conveniens posture rather

than under Rule 12(b)(3).31 After holding oral argument, the magistrate issued a

28
Id. at *3.
29
Id.
30
Ney v. 3i Group, P.L.C., 2021 WL 8082324, at *1 (W.D. Tex. Apr. 30, 2021).
31
Ney v. 3i Group, P.L.C., 2023 WL 6121774, at *3; see also Ney v. 3i Group, P.L.C.,
2021 WL 8082411, at *2.
8
Report & Recommendation (the “Report”) recommending Defendants’

supplemental motion to dismiss be granted in accordance with the forum selection

clauses in two written agreements—the Stock Purchase Agreement and the Rollover

Agreement.32 Ney objected to the Report.33 On April 30, 2021, the District Court

judge accepted and adopted the Report, dismissing the case without prejudice

pursuant to the forum selection clauses in both the Stock Purchase Agreement and

the Rollover Agreement.34

On May 20, 2021, Ney appealed to the United States Court of Appeals, Fifth

Circuit.35 The Fifth Circuit reviewed: (1) the District Court’s interpretation of a

forum selection clause and its assessment of that clause’s enforceability de novo;

and (2) the District Court’s balancing of the public and private interest factors for

abuse of discretion.36 The Fifth Circuit ultimately determined that the forum

selection clause in the Rollover Agreement is mandatory and enforceable.37

Accordingly, on September 19, 2023, the Fifth Circuit affirmed the District Court’s

32
Ney v. 3i Group, P.L.C., 2021 WL 8082324, at *1.
33
Ney v. 3i Group, P.L.C., 2023 WL 6121774, at *2.
34
Id.
35
Ney v. 3i Group, P.L.C., 2023 WL 6121774, at *2; see also Ney v. 3i Group, P.L.C.,
2023 WL 6121774, Docket No. 21-50431 (5th Cir. May 20, 2021) (Entry No. 1)
(“Notice of Appeal filed by Appellant Mr. S. Christopher Ney”).
36
Ney v. 3i Group, P.L.C., 2023 WL 6121774, at *2.
37
Ney v. 3i Group, P.L.C., 2023 WL 6121774, at *5.
9
dismissal for forum non conveniens without needing to address the question of

whether Ney’s case fell within the Stock Purchase Agreement’s forum selection

clause.38

2. THE INSTANT ACTION

Almost one year later, on August 28, 2024, Ney filed the present Complaint

seeking damages for breach of contract (“Count I”), or, in the alternative, promissory

estoppel (“Count II”) and unjust enrichment (“Count III”), relating to the

Defendants’ repudiation of their alleged 2019 promise to pay Ney $20 million.39

Ney acknowledges that he initially brought these claims in Texas state and federal

courts, which held that the dispute could only be litigated in Delaware based on a

forum selection clause in the Stock Purchase Agreement.40 He further explains that

he does not agree that this dispute is governed by the Stock Purchase Agreement,

but brings this action here based on Defendants’ position and the Texas courts’

decisions.41

38
Id.
39
Compl.
40
Compl. at 4, n.1.
41
Compl. at 4, n.1.
10
The Defendants move under Delaware Superior Court Civil Rule 12(b)(6) to

dismiss all claims asserted in Ney’s Complaint.42 Ney responded on December 16,

2024,43 and the Defendants replied on January 14, 2025.44 This Court heard oral

argument and reserved its decision on February 4, 2025.45

III. STANDARD OF REVIEW

Upon a Rule 12(b)(6) motion, the Court: (1) accepts all well-pleaded factual

allegations as true; (2) credits vague allegations if they give the opposing party notice

of the claim; (3) draws all reasonable inferences in favor of the non-moving party;

and (4) denies dismissal if recovery on the claim is reasonably conceivable.46 The

Court will grant a motion to dismiss only when “it appears ‘with reasonable certainty

that, under any set of facts that could be proven to support the claims asserted, the

plaintiff would not be entitled to relief.’”47

42
Op. Br.
43
D.I. 25 (hereinafter “Ans. Br.”).
44
D.I. 27 (hereinafter “Reply”).
45
D.I. 30.
46
Cent. Mortg. Co. v. Morgan Stanley Mortg. Cap. Holding, LLC, 27 A.3d 531, 535
(Del. 2011).
47
Banner v. Hockessin Chase, L.P., 2022 WL 1537382, at *3 (Del. Super. May 12,
2022).
11
IV. ANALYSIS

A. PLAINTIFF’S CLAIMS ARE BARRED BY THE STATUTE OF LIMITATIONS,
AND THE DELAWARE SAVINGS STATUTE IS INAPPLICABLE TO
PLAINTIFF’S CLAIMS.
Defendants contend that Plaintiff’s claims cannot be timely, because the

relevant statute of limitations provides for a three-year limitation period for breach

of contract, promissory estoppel, and unjust enrichment.48 Because Ney’s claims

stem from alleged wrongful conduct in May 2019, Defendants assert they are plainly

time-barred by Delaware’s three-year statute of limitations.49 Further, Defendants

argue the Delaware Savings Statute and other tolling doctrines do not apply to make

the filing timely.50 Defendants specifically allege that Ney cannot take advantage of

the Savings Statute or other tolling doctrines where he intentionally disregarded a

forum selection clause.

Ney maintains that his claims are timely under the Delaware Savings Statute.51

Delaware’s Savings Statute, 10 Del. C. § 8118(a), protects claims from being time-

barred where they were timely brought in an incorrect forum.52 Ney asserts that

48
Op. Br. at 2 (citing 10 Del. C. § 8106).
49
Id.
50
Op. Br. at 10-11.
51
Ans. Br. at 2.
52
10 Del. C. § 8118(a).
12
because the Fifth Circuit affirmed the dismissal of the lower court on September 19,

2023, the instant action, filed in August 2024, is timely.

The Delaware Savings Statute is triggered when the original action is abated.53

“[A]t common law, an abatement was an overthrow of a suit, the equivalent of a

dismissal” and “in equity . . . an interruption or suspension of a suit, the equivalent

of a stay of proceedings.”54 Thus, the first question becomes whether Ney’s claims

were “dismissed or stayed ‘for any matter of form,’ so as to entitle him to an extra

year to re-file that petition.”55

The undisputed answer is yes. Ney’s District Court action was dismissed

without prejudice.56 Thus, his claims were dismissed in a manner that entitled him

additional time under the Savings Statute to re-file his petition. The General

Assembly designed the Savings Statute “to mitigate against the harshness of the

defense of limitations raised against a plaintiff who, through no fault of his own finds

his cause technically barred by the lapse of time.”57 Delaware courts, however,

53
Rogers v. iTy Labs Corp, 2022 WL 985536, at *6 (Del. Ch. Mar. 31, 2022) (citing
Parker v. Gadow, 2005 WL 1952938, at *1 (Del. Super. Aug. 5, 2005), aff’d, 893
A.2d 964 (Del. 2006)).
54
Id. (quoting Graleski v. ILC Dover, 26 A.3d 213 (Del. 2011)).
55
Id.
56
Ney v. 3i Group, P.L.C., 2023 WL 6121774, at *3.
57
Id. (quoting Giles v. Rodolico, 140 A.2d 263, 267 (Del. 1958)) (emphasis in
original).
13
recognize that where a litigant disregards or strategically tries to avoid an applicable

forum selection clause, the Savings Statute does not apply.58

Ney elected to file suit in Texas state court against the New Amsterdam

Entities and 3i Group.59 On the New Amsterdam Entities motion to dismiss, the

court informed Ney that his claims against the New Amsterdam Entities were subject

to the forum selection clauses within the Stock Purchase Agreement and the Rollover

Agreement, because the claims were brought against parties to the Transaction

Agreements and directly related to the sale of Magnitude.60 Instead of filing his

claim against the New Amsterdam Entities in Delaware, Ney amended his

Complaint to add another Defendant who was not a signatory to the Transaction

Agreements.61

After removal to federal court, the Texas District Court dismissed the action

against the Defendants without prejudice pursuant to the forum selection clauses in

both the Stock Purchase Agreement and the Rollover Agreement.62 The District

58
Tilden v. Cunningham, 2018 WL 5307706, at *15 (Del. Ch. Oct. 26, 2018) (holding
that plaintiff’s claims were barred by laches where he first filed elsewhere despite a
Delaware forum selection clause “because any harm [he] has suffered [wa]s entirely
self-inflicted.”)
59
Ney v. 3i Group, P.L.C., 2023 WL 6121774, at *2.
60
Id.
61
Id. at *3.
62
Id.
14
Court held that, despite being non-signatories to the Rollover Agreement, “[the

Defendants] may enforce the Rollover Agreement’s forum-selection clause against

Ney” because “enforcement [by a non-signatory] is permitted if the relationship

between a non[-]signatory and a signatory to the contract is close enough that the

non[-]signatory’s enforcement of the forum-selection clause would be ‘foreseeable’

to the opposing party.”63 Thus, although Ney continues to maintain that he has not

sued under any Transaction Agreement, the Texas state and federal courts previously

determined that the Stock Purchase Agreement’s and the Rollover Agreement’s

mandatory forum selection clauses apply to his claims.64

After receiving the District Court’s decision that his claims against the

Defendants fell within the forum selection clauses in the Stock Purchase Agreement

and the Rollover Agreement, Ney’s claims, if brought in Delaware, would have been

63
Ney v. 3i Group PLC, 2021 WL 8082411, at *3.
64
Ney admits that his Texas state and federal court claims are the same as the claims
in the subject litigation. Ans. Br at 13. Because Ney admits that his claims are the
same as his claims in the Texas actions, the issue of judicial estoppel is moot. See
Reply at 7, n.4 (“Since Plaintiff has now confirmed that he is bringing the same
claims as he did in Texas, the Court need not address Defendants’ judicial estoppel
arguments.”).
15
timely.65 Yet, Ney still did not file his claim in the proper jurisdiction.66 Instead, he

chose to appeal the decision.67 The Fifth Circuit ultimately affirmed the District

Court’s dismissal and found the forum selection clause in the Rollover Agreement

mandatory and enforceable.68

Ney was on notice that his claims against the Defendants were subject to the

forum selection clauses within the Stock Purchase Agreement and the Rollover

Agreement as early as April 30, 2021.69 Ney could have hedged his bet by filing in

Delaware immediately after the District Court dismissed his suit.70 Instead, he went

“all in” and pursued an appeal rather than filing a claim within the statute of

limitations in the forum he contractually agreed to.71 Despite being on notice, he

65
Ney v. 3i Group PLC, 2021 WL 8082411, at *3. Because Ney’s claims concern an
alleged oral agreement made in 2019, the statute of limitations for Ney’s claims
expired in 2022.
66
Id.
67
Id.
68
Id. at *5.
69
Ney v. 3i Group PLC, 2021 WL 8082324, at *1; see also Ney v. 3i Group PLC,
2021 WL 8082411, at *3.
70
See Huffington v. T.C. Group, LLC, 2012 WL 1415930, at *9.
71
See id. (noting that such facts indicated that [plaintiff] “did forum shop. He tried
to avoid the clear and unambiguous forum selection clause by filing in
Massachusetts. He clearly sought to avoid litigating his claims here.”)
16
chose a strategy that backfired.72 Thus, in this circumstance, it is inappropriate to

apply the Delaware Savings Statute to save him from the consequences of his

strategic decisions.73

For these reasons, as a matter of law, Delaware’s three-year statute of

limitations applies, barring Ney’s claims regarding the alleged Post-Closing

Agreement made in 2019.

B. CERTAIN TRANSACTION AGREEMENTS PRECLUDE NEY’S POST-
CLOSING AGREEMENT CLAIMS.

Even if Ney’s claims were not time-barred, the Stock Purchase Agreement,

the two Incentive Grant Agreements, and the Rollover Agreement preclude Ney’s

claims. Defendants separately argue that the Post-Closing Agreement claims are

precluded by the Transaction Agreements.74 Specifically, the Defendants argue that:

(i) the Transaction Agreements apply to the Post-Closing Agreement;75 and (ii) the

fully-integrated Transaction Agreements preclude Plaintiff’s claims.76

72
Huffington v. T.C. Group, LLC, 2012 WL 1415930, at *10; see also Saudi Basic
Indus. Corp. v. Mobil Yanbu Petrochemical Co., 2003 WL 22016864, at *1 (Del.
Super. Aug. 26, 2003) (noting that the plaintiff “made a conscious, strategic decision
to file this case here . . . That risky strategy backfired, miserably, and now . . .
[Plaintiff] cries foul . . . .”).
73
Huffington v. T.C. Group, LLC, 2012 WL 1415930, at *10.
74
Op. Br. at 11.
75
Op. Br. at 15.
76
Op. Br. at 19.
17
1. THE COURT MAY CONSIDER THE STOCK PURCHASE
AGREEMENT, THE INCENTIVE GRANT AGREEMENTS, AND THE
ROLLOVER AGREEMENT.

Ney generally contends that the Transaction Agreements are “matters outside

of the [C]omplaint” and, as a result, cannot be considered by the Court in ruling on

this Motion.77 Ney specifically argues that the Transaction Agreements: (1) were

inappropriately attached by Defendants to prove the truth of the pleadings’

contents;78 and (2) cannot be integral to his claims “when he is expressly not bringing

any claims under them.”79

Defendants assert that the Court can consider the Transaction Agreements

because they are incorporated by reference into the pleadings and integral to Ney’s

claims.80 Defendants separately argue that, because the same Post-Closing

Agreement was at issue in the Texas litigation, Ney is collaterally estopped from

arguing that the Transaction Agreements do not apply to the Post-Closing

Agreement in this case.81 Accordingly, the Court must first determine whether the

Transaction Agreements may be considered.

77
Ans. Br. at 14.
78
Ans. Br. at 16-17.
79
Ans. Br. at 16.
80
Op. Br. at 16.
81
Op. Br. at 15.
18
2. THE STOCK PURCHASE AGREEMENT, THE INCENTIVE GRANT
AGREEMENTS, AND THE ROLLOVER AGREEMENT ARE
INCORPORATED INTO THE COMPLAINT BY REFERENCE AND
INTEGRAL TO PLAINTIFF’S CLAIMS.

In deciding a motion to dismiss, courts generally consider only the allegations

contained in the complaint, exhibits attached to the complaint, and matters of public

record.82 When parties present positions and reference materials neither

incorporated into nor integral to the complaint, the Court may convert the motion to

one for summary judgment.83 However, this will not occur if the additional materials

are incorporated into the complaint by reference and integral to the claims of the

complaint or the materials are not being relied upon to prove the truth of the

contents.84 Defendants assert, among other things, that the Court can properly

consider the Transaction Agreements because the following facts establish the

Transaction Agreements are integral to Ney’s claims: (1) the Stock Purchase

82
Sweetwater Point, LLC v. Kee, 2020 WL 6561567, at *5 (Del. Super. Nov. 5, 2020)
(internal citations omitted).
83
Driggus v. State Farm Mut. Auto. Ins. Co., 2023 WL 7599490, at *1 (Del. Super.
Nov. 15, 2023).
84
Cambridge Strategic Mgmt. Grg. v. IDT Domestic Telecom, Inc., 2013 WL
2480887, at *3 (Del. Super. Apr. 8, 2013).
19
Agreement and the equity plan85 are referenced in the Complaint; and (2) the

Transaction itself was referenced in over a third of the Complaint.86

Whether a document is incorporated into a complaint and integral to a claim is

largely a facts-and-circumstances inquiry.87 In Fortis Advisors LLC v. Allergan

W.C., the Court of Chancery held a document is integral to a claim if it is the source

for the facts as pled in the complaint.88 There, as here, the plaintiff conceded that it

referenced some of the defendant’s exhibits in its Amended Complaint, but

contended that those documents were not integral to its breach of contract claim.89

The Court found that the plaintiff “use[d] these referenced documents to form the

factual foundation for its claim, and therefore that they [were] integral to the

claim.”90

While Ney contends the obligations under the Post-Closing Agreement were

not part of the Magnitude sale, his Complaint references the sale91—an acquisition

85
Op. Br. at 16. Ney’s “equity plan,” referenced in the Complaint, was memorialized
in the two Incentive Grant Agreements. See Compl. ¶ 19; see also Incentive Grant
Agreements.
86
Op. Br. at 16.
87
In re Gardner Denver, Inc., 2014 WL 715705 at *3 (Del. Ch. Feb. 21, 2014).
88
2019 WL 5588876, at *3 (Del. Ch. Oct. 20, 2019).
89
Id.
90
Id. (emphasis added).
91
Compl. ¶¶ 4, 5, 6, 16, 17, 18.
20
which is undisputedly governed by the Stock Purchase Agreement. Similarly, Ney’s

references to his post-closing employment and compensation92 are governed by the

two Incentive Grant Agreements. The Complaint also references the Texas courts’

decisions finding the applicability of the forum selection clause.93 Additionally,

these Agreements are integral to Ney’s Post-Closing Agreement claims. Ney’s

claims are based on his assertion that Defendants breached the oral agreement

whereby Defendants promised to compensate Ney for keeping Defendants in the

front of the line of during negotiations which Ney asserts occurred because Ney

fulfilled his promise during the negotiation process. These claims rely on the Stock

Purchase Agreement, which evidences the sale of Magnitude. Ney was also

promised compensation for staying on as CEO of Magnitude to steer the new equity

group through the post-acquisition period to set Magnitude up for continued growth

and success working through the negotiations to a successful close. This alleged

promise—a vital component of Ney’s claims—is memorialized in the two Incentive

Grant Agreements and the Rollover Agreement, agreements that Ney signed.

92
Id. ¶¶ 7, 8, 18, 19, 20, 21.
93
Compl. ¶ 13, n.1. Ney does not mention that the District Court’s determination
also hinged on the Rollover Agreement’s forum selection clause. The District Court
held that the Stock Purchase Agreement and the Rollover Agreement both contained
mandatory and enforceable forum selection clauses which covered all Ney’s claims.
See Ney v. 3i Group PLC, 2021 WL 8082411, at *11-12.
21
The foundation of Ney’s Post-Closing Agreement claims relates to the sale of

Magnitude, including his post-closing employment and compensation, through the

executed Stock Purchase Agreement, the Incentive Grant Agreements, and the

Rollover Agreement. Stated differently, the Complaint’s factual basis flows from

these Agreements,94 and these Agreements are the source of the facts pled.95 This

litigation would not exist without these Agreements and the actions taken under

these Agreements.

Accordingly, the Court can consider the Stock Purchase Agreement, the

Incentive Grant Agreements, and the Rollover Agreement, as they are integral to the

Complaint and incorporated by reference, without converting the Motion to a motion

for summary judgment.96

94
Massandra Cap. IV, LLC v. CEAI Aspen Place Manager, LLC, 2024 WL 3411813,
at *4 (Del. Super. July 15, 2024) (agreement was integral to a plaintiff’s claim where
the “litigation’s factual basis flow[ed] from” the agreement defendant attached to
their motion to dismiss).
95
Orman v. Cullman, 794 A.2d 5, 16 (Del. Ch. 2002) (concluding a proxy statement
was “integral to [a] complaint as it [was] the source for the merger-related facts as
pled in the complaint”).
96
The Court does not and need not consider the six other Transaction Agreements.
22
3. COLLATERAL ESTOPPEL FORECLOSES NEY’S CONTENTION
THAT THE STOCK PURCHASE AGREEMENT AND THE ROLLOVER
AGREEMENT DO NOT APPLY.

In addition, collateral estoppel forecloses any argument that the Stock

Purchase Agreement and the Rollover Agreement do not apply to the Post-Closing

Agreement. In Delaware, “[j]udgments by other courts, both state and federal, must

be given the same force and effect in this Court as they would be given in the

‘rendering court.’”97 The law of the jurisdiction in which the initial case was

dismissed controls whether collateral estoppel applies.98 The initial case jurisdiction

is the Western District of Texas, thus federal issue preclusion law under Fifth Circuit

precedent applies.99

In the Fifth Circuit, collateral estoppel applies if: “(1) the identical issue was

previously adjudicated; (2) the issue was actually litigated; and (3) the previous

determination was necessary to the decision.”100 The District Court determined that

the Stock Purchase Agreement and the Rollover Agreement applied to Plaintiff’s

97
Asbestos Workers Loc. 42 Pension Fund ex rel. JPMorgan Chase & Co. v.
Bamman, 2015 WL 2455469, at *15 (Del. Ch. May 22, 2015).
98
Pyott v. La. Mun. Police Emps.’ Ret. Sys., 74 A.3d 612, 614, 616-17 (Del. 2013).
99
See Ney v. 3i Group, P.L.C., 2021 WL 8082411.
100
Bradberry v. Jefferson Cnty., Tex., 732 F.3d 540, 548 (5th Cir. 2013) (internal
citations omitted).
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Post-Closing Agreement.101 More, Ney himself admits his Texas state and federal

court claims are the same as the claims in the subject litigation.102 Ney’s concession

leads to the preclusive effect of the Texas courts’ rulings that the Stock Purchase

Agreement and the Rollover Agreement apply to Ney’s claims and binds Ney.103

4. THE FULLY-INTEGRATED STOCK PURCHASE AGREEMENT
PRECLUDES NEY’S COMPLAINT.

Now that the Court has determined that the Stock Purchase Agreement, the

Incentive Grant Agreements, and the Rollover Agreement may be considered, the

Court addresses whether these Agreements bar Ney’s Complaint. These

Agreements, which generally refer to one another, have integration clauses that state

that the respective contracts “contain the complete agreement by, between and

among the parties and supersede any prior understandings, agreements or

representations by, between or among the parties, written or oral, which may have

related to the subject matter hereof in any way.”104 The Incentive Grant Agreements

further provide that “[n]o modification, amendment or waiver of any provision . . .

101
The District Court expressly held that Ney’s Texas complaint “sufficiently
implicate[d] the underlying written agreements” and that “Ney’s claims
unequivocally f[e]ll within the scope of the Rollover Agreement.” See Ney v. 3i
Group, P.L.C., 2021 WL 8082411 at *8, n.13, *11.
102
Ans. Br. at 13 (emphasis added).
See Asbestos Workers Loc. 42 Pension Fund ex rel. JPMorgan Chase & Co. v.
103

Bamman, 2015 WL 2455469, at *15.
104
Stock Purchase Agreement § 12.09.; see also Incentive Grant Agreements § 7.
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shall be effective . . . unless such modification, amendment or waiver is approved in

writing . . . .”105

Where, as here, integration clauses preclude separate oral or written

agreements, claims based on any alleged separate agreement must be dismissed.106

Accordingly, Ney’s claims are also barred by the integration and no oral amendment

clauses.

More, Ney cannot circumvent this preclusive effect through alternative quasi-

contract claims. Unjust enrichment and promissory estoppel do not apply “where a

fully integrated, enforceable contract governs the promise at issue.”107 As the Court

noted, the Stock Purchase Agreement, Incentive Grant Agreements, and Rollover

Agreement govern the subject matter of Ney’s alleged Post-Closing Agreement.108

Accordingly, Ney’s claims for promissory estoppel and unjust enrichment fail as a

matter of law.

105
Incentive Grant Agreements § 7.
106
Black Horse Cap., LP v. Xstelos Hldgs., Inc., 2014 WL 5025926, at *24
(construing the integration clauses of transaction agreements “to indicate that there
were no separate oral contracts regarding the subject matter of those Agreements,
and that there was no separate consideration or inducement for entering into those
Agreements”).
107
Neurvana Med., LLC v. Balt USA, LLC, 2020 WL 949917, at *21 (Del. Ch. Feb.
27, 2020); Black Horse Cap., LP v. Xstelos Hldgs., Inc., 2014 WL 5025926, at *26
(Del. Ch. Sept. 30, 2014).
108
See discussion supra Section IV.B.2-3.
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V. CONCLUSION

Ney consciously ignored the forum selection clause within the parties’ written

agreements and filed his claim in another jurisdiction. In this circumstance, it is

inappropriate to apply the Delaware Savings Statute to save Ney from the

consequences of his strategic decisions. Further, even if timely filed, any claims

regarding the alleged Post-Closing Agreement are precluded by the fully-integrated

Stock Purchase Agreement, the Incentive Agreements, and the Rollover Agreement.

Accordingly, the Court GRANTS Defendants’ Motion and dismisses

Plaintiff’s Complaint with prejudice.

IT IS SO ORDERED.

/s/ Patricia A. Winston
Patricia A. Winston, Judge

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