Case of the Day: AlixPartners v. Mori

The case of the day is AlixPartners LLP v. Mori (Del. Ch. 2019). AlixPartners was a “global business advisory firm.” Giacomo Mori was its managing director in Milan. During his employment, Mori received equity interests in two Delaware entities, AlixPartners, LLP and AlixPartners Holdings, LLP. The equity awards were governed by agreements that had Delaware choice of law and choice of forum clauses. He was an employee of AlixPartners S.r.l., an Italian firm, and his employment agreement had an Italian choice of law clause—but no choice of forum clause. All three of the Alix entities were plaintiffs. They alleged that Mori knew he was about to lose his job and that he downloaded confidential company information and refused to return it. They brought claims for breach of a duty of confidentiality, for breach of contract, for trade secret misappropriation, etc., in Delaware. Mori moved to dismiss, arguing that the claim had to be brought in Italy and that the Chancery Court lacked subject-matter jurisdiction.

Mori pointed to the Brussels Regulation, which provides that in cases relating to an “individual contract of employment,” the employer can sue “only in the courts of the Member State in which the employee is domiciled.” The orthodox answer to this is “so what?” The Restatement takes the view that “A State may entertain an action even though the state of the applicable law has provided that action on the particular claim shall not be brought outside its territory.” (Restatement (Second) of Conflict of Laws § 91 (1971)). The court did not cite the Restatement. But it turns out that Delaware has some cases on point that allowed the court to reach the right decision. The rule it derived from the cases makes the result depend on whether:

the rights and remedies at issue are transitory in nature in that they “are not so inseparably united as to make the right[s] dependent upon [their] being enforced in a particular tribunal.”

Here, the Brussels regulation was not closely tied to the substantive right of action; it is merely a jurisdiction-allocating regulation. The claims were thus transitory and could be heard in any court with jurisdiction.

I suspect we will see more of this issue in the trans-Atlantic context. The GDPR, for example, provides that a civil action can only be brought in the courts of an EU member state.

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