In the Court of Chancery of the State of Delaware
IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE CARLYLE INVESTMENT MANAGEMENT ) L.L.C. and TC GROUP, L.L.C., ) ) Plaintiffs, ) ) v. ) C.A. No. 5527-CS ) NATIONAL INDUSTRIES GROUP ) (HOLDING), ) ) Defendant. ) MEMORANDUM OPINION Date Submitted: October 3, 2012 Date Decided: October 11, 2012 R. Judson Scaggs, Jr., Esquire, Pauletta J. Brown, Esquire, MORRIS, NICHOLS, ARSHT & TUNNELL LLP, Wilmington, Delaware; Robert A. Van Kirk, Esquire, David S. Kurtzer-Ellenbogen, Esquire, Brian C. Rabbitt, Esquire, WILLIAMS & CONNOLLY LLP, Washington, District of Columbia, Attorneys for Plaintiffs Carlyle Investment Management L.L.C. and TC Group, L.L.C. Michael F. Bonkowski, Esquire, Therese A. Scheuer, Esquire, COLE, SCHOTZ, MEISEL, FORMAN & LEONARD, P.A., Wilmington, Delaware, Attorneys for Defendant National Industries Group (Holding). STRINE, Chancellor. I. Introduction This is a dispute between one of the world‟s largest private equity firms, the Carlyle Group (“Carlyle”), and a Kuwait-based multi-national, multi-billion dollar conglomerate, National Industries Group (“National”). In 2006, these two sophisticated parties, who had long-standing business dealings with each other, entered into an agreement for National to make a $10 million investment into a Carlyle-affiliated closed- end investment fund, Carlyle Capital Corporation, that was going to make investments primarily in residential mortgage-backed securities. The investment fund was not successful, and was placed in compulsory liquidation. National wanted its money back. Ignoring the forum selection clause in the agreement between the parties, which provided that “[t]he courts of the State of Delaware shall have exclusive jurisdiction over any action, suit or proceeding with respect to [the parties‟] Agreement,” National filed suit against Carlyle in Kuwait.1 In response, Carlyle sought to enforce the forum selection clause in the agreement by filing this action in the Court of Chancery.
[Show full text]