WILMINGTON, Del. (Legal Newsline) – A Connecticut man's lawsuit claiming he and other shareholders had been intentionally misled by DuPont executives about the potential of the company's chemicals division spinoff Chemours Co. has been tossed out by a state judge who said he failed to make his case.
Delaware Superior Court Judge Abigail M. LeGrow also declined in her Nov. 28 20-page ruling to grant the plaintiff, Matthew B. Mooney of Greenwich, leave to amend his complaint if she granted DuPont's motion to dismiss.
Delaware Superior Court Judge Abigail M. LeGrow
"In my view, granting Mooney leave to amend likely would be futile and certainly would be an inefficient use of resources," LeGrow said in her ruling in which she referred to Mooney as "a sophisticated, law-trained investor."
Mooney has been representing himself in the case.
In its motion to dismiss, DuPont counsel identified "several deficiencies" in Mooney's lawsuit, according to LeGrow's ruling.
"Rather than amending his complaint to cure those deficiencies and strengthen his claim, Mooney filed a 50-page brief defending his claim and demonstrating an understanding of the elements of fraud and the law interpreting it," LeGrow said in her ruling.
"The parties went through full briefing and argument, yet Mooney did not once identify any additional allegations that might bolster his claim. Mooney’s failure to identify any misstatements of fact on which he relied or any contemporaneous fact suggesting DuPont’s statements were false when made are not defects easily resolved through an amended complaint.
"If Mooney possessed such facts, he had ample opportunity to identify them."
DuPont announced in July 2015 it had completed the spin-off of Chemours, which began trading on the New York Stock Exchange that month. DuPont's was in decline by the end of that same month and "Mooney terminated his exposure to DuPont and Chemours 'at a significant loss' on July 20, 2015," according to the Superior Court's ruling.
Fortune magazine reported that few at the time "gave the orphaned appendage much hope" and the new company was expected to fail but managed to survive and rally within a year. This past February, share prices for Chemours surged after the company and DuPont agreed to a settlement of personal injury lawsuits stemming from toxic chemical exposure at a West Virginia plant.
Mooney alleged in his lawsuit that he'd purchased DuPont stock after company representatives fraudulently misrepresented the potential of Chemours to be a success. LeGrow in her ruling said what Mooney called misrepresentations were opinions and not statements of fact.
"The key question in this case is whether the statements on which the plaintiff purportedly relied were statements of fact or forward-looking statements," LeGrow said in her ruling.
"The statements at issue, all couched in terms of the speaker’s expectation or opinion about future events, were forward-looking statements that only can form the basis of a fraud claim when the plaintiff adequately alleges the statements were known to be false when made or were made in bad faith."
"The only allegations Mooney used to support his claim were based on later-occurring events," LeGrow said. "The lack of any contemporaneous factual allegations suggesting DuPont’s officers made false statements knowingly or with lack of good faith dooms the plaintiff's claims."