Gorodetskiy v. Honeywell International Inc. — Advancement Denied

COURT OF CHANCERY OF THE STATE OF DELAWARE

LOREN MITCHELL LEONARD L. WILLIAMS JUSTICE CENTER

500 NORTH KING STREET, SUITE 11400 MAGISTRATE IN CHANCERY

Date Submitted: February 3, 2026 Date Decided: April 22, 2026 Elizabeth A. DeFelice, Esquire Kaitlyn R. Zavatsky, Esquire Catherine E. Lynch, Esquire Richards, Layton & Finger, P.A. Heyman Enerio Gattuso & Hirzel LLP 920 North King Street 222 Delaware Avenue, Suite 900 Wilmington, DE 19801 Wilmington, DE 19801 Re: Mikhail Gorodetskiy v. Honeywell International Inc., Dear Counsel: This letter resolves the pending motion for default judgment, motion to dismiss, and motion for summary judgment. At the heart of these motions, is whether the Plaintiff, Mikhail Gorodetskiy, is entitled to advancement of legal expenses under the Certificate of Incorporation. For reasons further explained in this letter, I find the Plaintiff failed to satisfy the contractual prerequisites governing such claims and is therefore not entitled to advancement of legal expenses. Defendant's motion to dismiss is, therefore, granted. Plaintiff's motions for summary judgment and default judgment are denied, and Plaintiff is not entitled to Samuel T. Hirzel, II, Esquire Mathew W. Murphy, Esquire fees-on-fees. This is my final report.

WILMINGTON, DE 19801-3734

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1. FACTUAL BACKGROUND Mikhail Gorodetskiy ("Plaintiff") is the former Chief Executive Officer ("CEO") of LLC UOP or OOO UOP (hereinafter "LLC UOP"), which is an indirect Russian subsidiary affiliated with Honeywell International Inc. ("Defendant"). 1 Plaintiff served in that role for several years and continued to act as CEO through mid-2022. In February and March of 2022, following Russia's invasion of Ukraine, 2 Defendant suspended and ultimately wound down its business operations in Russia, including those of LLC UOP. LLC UOP was dropped from email correspondence 3 and removed from Defendant's corporate intranet and all other internal systems. 4 Plaintiff's employment formally ended in June 2022. 5 Before his departure, Plaintiff sought clarity on Defendant's indemnification policies. Defendant responded by issuing a letter confirming that its 6 indemnification policies would continue to apply to Plaintiff even after his

Docket Item ("D.I.") 1 ¶ 2. 1 D.I. 1 ¶ 2. 2 D.I. 1 ¶ 18; D.I. 15 at 2. 3 D.I. 1 ¶ 18. 4 D.I. 1 ¶ 2. 5 D.I. 1 ¶ 6; D.I. 15 at 2. 6

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employment ceased (the "Letter of Indemnity"). The Letter of Indemnity explained 7 that those rights arise under Article Eleventh of Defendant's Certificate of Incorporation, which governs indemnification and advancement and sets forth the procedures by which an indemnitee may seek advancement of expenses. 8 Due to Defendant's cessation of its business operations in Russia and LLC UOP's removal from Defendant's internal system, LLC UOP was left unable to In August 2023, fulfill its contractual obligations, leading to significant liabilities. 9 a Russian commercial court declared LLC UOP insolvent and appointed Anna Alekseevna Logacheva ("Logacheva" or the "Insolvency Administrator") as the insolvency administrator, who then initiated proceedings against Plaintiff. The 10 Insolvency Administrator brought various claims against Plaintiff as a result of his former position as CEO of LLC UOP (these claims are henceforth referred to as the "Insolvency Action"). 11

D.I. 1 ¶ 1; D.I. 15 at 2; D.I. 1, Ex. B. 7 See D.I. 1, Ex. A., art. Eleventh. 8 D.I. 1 ¶¶ 1, 18; D.I. 15 at 2. 9 D.I. 1 ¶¶ 3, 19. 10 D.I. 1 ¶¶ 3, 20. 11

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The first claim of the Insolvency Action sought the production of documents and information from Plaintiff related to LLC UOP and remains pending. 12 second claim sought to invalidate compensation paid to Plaintiff from March to June This claim was 2022, before his termination as CEO and LLC UOP's insolvency. 13 dismissed and is no longer subject to further proceedings. A third claim challenged 14 the validity of an extension of a loan agreement involving Defendant and LLC UOP that Logacheva claims may have contributed to LLC UOP's insolvency, and likewise remains unresolved. The Insolvency Administrator also indicated the 15 possibility of pursuing additional claims against Plaintiff based on theories of secondary liability under Russian law tied to the subsidiary's unsatisfied debts. 16 In addition to the Insolvency Action, Plaintiff became involved in separate proceedings initiated by Russian customs authorities concerning documentation related to LLC UOP's operations (the "Customs Inquiries"). The Customs 17 Inquiries, issued in early 2025, sought information relating to technical

D.I. 1 ¶ 20. 12 D.I. 1 ¶ 21. 13 Id. 14 D.I. 1 ¶ 22. 15 D.I. 1 ¶ 23. 16 D.I. 1 ¶ 24. 17

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documentation imported into Russia by LLC UOP. Plaintiff responded to the 18 Customs Inquiries to the best of his recollection but asserted that he no longer possessed responsive materials because company records had been transferred following his departure from LLC UOP. 19 Plaintiff incurred legal expenses for these matters and sought to invoke his contractual right to advancement. 20

1. The Demand On February 11, 2025, Plaintiff sent Defendant a written demand requesting advancement and indemnification for expenses associated with the Russian proceedings (the "Demand Letter"). The Demand Letter did not include an 21 executed undertaking and did not expressly commit to repay any advanced amounts,

Id. 18 Id. 19 D.I. 1 ¶ 36; D.I. 15 at 5. 20 D.I. 1 ¶¶ 36-37; D.I. 15 at 5; see D.I. 1, Ex. C. 21

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as contemplated by the undertaking requirement in the governing instrument. The 22 Defendant did not advance funds in response to that demand. 23

1. Procedural Posture Plaintiff initiated this action on September 24, 2025, seeking advancement of expenses and related relief. After the action was filed, the parties conferred 24 regarding the claims and the governing contractual requirements. Defendant 25 raised, among other issues, that Plaintiff had not complied with the procedural prerequisites set forth in Article Eleventh for making a valid advancement demand, Plaintiff submitted the including the requirement that an undertaking be provided. 26 undertaking to the Court on October 14, 2025. 27

D.I. 1 ¶¶ 36-37; D.I. 15 at 5; see D.I. 1, Ex. C; D.I. 1, Ex. A., art. Eleventh § (2)(A) ". 22 . . provided however, that . . . an advancement of expenses incurred by an indemnitee in his or her capacity as a Director . . . in advance of the final disposition of a proceeding, shall be made only upon delivery to the corporation of an undertaking . . . to repay all amounts so advanced if it shall ultimately be determined by final judicial decision . . . that such indemnitee is not entitled to be indemnified for such expenses . . . ") (emphasis in original). D.I. 1 ¶ 39; D.I. 15 at 6; D.I. 8 at 2 (Defendant argues that Plaintiff had still failed to 23 make a valid advancement demand on October 10, 2025, and thus had not made an advancement pursuant to the demand by that date.). See D.I. 1. 24 D.I. 15 at 8. 25 D.I. 15 at 8; D.I. 8 at 2. 26 D.I. 9, Ex. 1. 27

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On October 15, 2025, Defendant moved to dismiss the Complaint. 28 Defendant questioned the scope and clarity of Plaintiff's demand, including whether it properly distinguished between advancement and indemnification and adequately identified the underlying proceedings. Defendant also asserted that the contractual 29 twenty-day waiting period had not been satisfied because, in its view, that period does not begin to run until a valid demand is submitted. 30 Plaintiff thereafter moved for summary judgment and default judgment. 31

1. ANALYSIS
2. Plaintiff's Motion for Default Judgment Under Court of Chancery Rule 55(b), default judgment may be entered where a party "has failed to appear, plead or otherwise defend as provided by these Rules . . . " against a claim for affirmative relief. A defendant's obligation to respond is 32 governed by Rule 12, which permits a party to file either an answer or a motion responsive to the complaint within the applicable time period. Moving to dismiss 33

See D.I. 10. 28 D.I. 15 at 8-9. 29 D.I. 15 at 9. 30 See D.I. 14. 31 Ct. Ch. R. 55(b). 32 See Ct. Ch. R. 12. 33

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may satisfy the requirement of Rule 55(b) without an answer being filed if it does not put the moving party at a severe tactical advantage because of the non-moving party's willful or conscious disregard for the Court's rules. 34 Default judgment is an extreme remedy and is granted sparingly. "Judgment 35 by default is . . . the extreme remedy and generally speaking the Rule has been interpreted to require 'some element of willfulness or conscious disregard of the order' before such a sanction is imposed . . . ." 36

Plaintiff seeks entry of default judgment asserting Defendant failed to respond to the Complaint. The record here does not support this application. Defendant 37 timely moved to dismiss in response to the Complaint and participated in the litigation process. Defendant also engaged in motion practice contemplated by the 38 Court's scheduling order, which permitted its dismissal arguments to be presented in parallel with summary judgment briefing. That conduct is sufficient to satisfy 39 its obligation to defend under the Rules.

See U.S. Surgical Corp. v. Auhll, 1998 WL 326493, at *1-2 (Del. Ch. May 28, 1998). 34 Id. 35 Sundor Elec., Inc. v. E.J.T. Constr. Co., 337 A.2d 651, 652 (Del. 1975). 36 D.I. 14 at 19-22. 37 Compare D.I. 1 (the Complaint, filed September 24, 2025), with D.I. 10 (Defendant's 38 motion to dismiss, filed exactly three weeks later on October 15, 2025). See D.I. 12. 39

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In these circumstances, granting default judgment would be disproportionate. Therefore, Plaintiff's motion for default judgment is denied.

1. Defendant's Motion to Dismiss
   Defendant's motion to dismiss challenges Plaintiff's standing, ripeness, and ability to state a claim based on alleged noncompliance with contractual prerequisites to this suit. Specifically, Defendant seeks dismissal and argues, 40 among other things, that Plaintiff has failed to meet the contractual preconditions under Article Eleventh. 41

2. Delaware Law Permits Contractual Preconditions for
   Advancement "[C]orporations may specify by bylaw or contract the terms and conditions upon which present and former corporate officials may receive advancement . . ." 42 "The advancement authority conferred by section 145(e) is permissive." 43 "Delaware law in general recognizes that the value of contracts is maximized by

D.I. 15 at 12-24. 40 Id. 41 Homestore, Inc. v. Tafeen, 888 A.2d 204, 212 (Del. 2005) (citing Gentile v. SinglePoint 42

Fin., Inc., 788 A.2d 111 (Del. 2001)).

Id. 43

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enforcing them as written [and that] little value can come of a promise that can be avoided upon the remorse of the maker thereof." 44 "The scope of an advancement proceeding is usually summary in nature and limited to determining the issue of entitlement in accordance with the corporation's own uniquely crafted advancement provisions." The resolution of this tension 45 turns on the specific language of the governing instrument and the circumstances in which the plaintiff seeks to invoke it. 46 Taken together, these principles confirm that advancement rights, while informed by public policy, are fundamentally contractual and must be enforced under the terms of the governing instrument. The Court's role is, therefore, limited to determining whether Plaintiff has established a present entitlement to advancement under those terms. Accordingly, the analysis turns to the requirements

Unbound P'rs Ltd. P'ship v. Invoy Hldgs. Inc., 251 A.3d 1016, 1031-32 (Del. Super. 44 Ct. 2021) (quoting Lyons Ins. Agency, Inc. v. Wark, 2020 WL 429114, at *1 (Del. Ch. Jan. 28, 2020)). Homestore, Inc., 888 A.2d at 212 (first citing 8 Del. C. § 145(k); then citing Kaung v. 45

Cole Nat'l Corp., 884 A.2d 500, at 510 (Del. 2005); and then citing Gentile v. SinglePoint Fin., Inc., 788 A.2d 111 (Del. 2001)).

See generally In re Genelux Corp., 2015 WL 6390232 (Del. Ch. Oct. 22, 2015) 46 (analyzing the specific language of an indemnification agreement and whether the circumstances show that the plaintiff had made a proper demand and was involved in the action by reason of his corporate status).

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of Article Eleventh, and, in particular, the procedural conditions governing the assertion of advancement rights.

1. The Structure of Article Eleventh Article Eleventh establishes a procedural framework governing claims for advancement. Section 2(A) provides that advancement "shall be made" upon 47 receipt of an undertaking, reflecting the statutory requirement under 8 Del. C. § 145(e) that a corporation may condition advancement on the recipient's agreement to repay if the recipient is found to not be entitled to indemnification. Section 2(B), 48 in turn, imposes a temporal limitation on litigation by requiring that a claimant wait twenty days after making a demand before initiating suit. This provision 49 essentially reflects the parties' agreement to defer litigation until the corporation has had a defined opportunity to evaluate the demand. The parties' dispute centers on how these two provisions interact. Plaintiff contends that Section 2(A) governs only the timing of payment and does not affect Under Plaintiff's reading, the twenty-day waiting period the validity of a demand. 50

See D.I. 1, Ex. A, art. Eleventh. 47 See 8 Del. C. § 145(e); see also Homestore, Inc., 888 A.2d at 211-12; D.I. 1, Ex. A, 48 art. Eleventh § 2(A). See D.I. 1, Ex. A, art. Eleventh § 2(B). 49 D.I. 14 at 18-19; D.I. 20 at 1-2. 50

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begins to run upon submission of a demand letter, regardless of whether an undertaking has been provided. Furthermore, Plaintiff asserts that the signed 51 undertaking is not required to accompany the demand, rather the signed undertaking is required only before a payment is made. Defendant, by contrast, argues that a 52 demand is not "valid" under Section 2(B) unless it includes an executed undertaking, because without such an undertaking the corporation has no obligation to advance expenses. 53 The Court finds the Defendant's interpretation persuasive. This interpretation is consistent with Delaware law's directive that advancement provisions, as contractual rights, must be enforced according to their plain terms. The better 54 reading of Article Eleventh, when Sections 2(A) and 2(B) are considered together, is that a demand for advancement must include the materials necessary to trigger the

D.I. 14 at 23-24; D.I. 20 at 5. 51 D.I. 14 at 18. 52 See D.I. 1, Ex. A, art. Eleventh §§ 2(A)-(B); D.I. 8; D.I. 15 at 1-2, 7, 15-16. 53 "Delaware law 'adheres to the objective theory of contracts,' which requires a court to 54 interpret a particular contractual term to mean 'what a reasonable person in the position of the parties would have thought it meant.' Delaware courts interpret a contractual term that is reasonably or fairly susceptible to only one interpretation according to the term's plain meaning." Blankenship v. Alpha Appalachia Holdings, Inc., 2015 WL 3408255, at *14 (Del. Ch. May 28, 2015) (first quoting Salamone v. Gorman, 106 A.3d 354, 367 (Del. 2014); then quoting Rhone-Poulenc Basic Chems. Co. v. Am. Motorists Ins. Co., 616 A.2d 1192, 1196 (Del. 1992); and then citing Osborn ex rel. Osborn v. Kemp, 991 A.2d 1153, 1159-60 (Del. 2010)), judgment entered, 2015 WL 3582352 (Del. Ch. June 5, 2015).

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corporation's obligation to act. Because the corporation has no duty to advance expenses until it receives an undertaking, a demand unaccompanied by an undertaking is not a request that the corporation is contractually obligated to evaluate or satisfy. 55 In that sense, the undertaking is not merely a condition precedent to payment; it is part of what renders the demand operative under the contractual scheme of the contracting parties. Thus, the twenty-day waiting period contemplated by Section 2(B) does not begin to run until both a demand and an undertaking have been submitted. Absent those elements, the corporation has no obligation to act and no 56 basis upon which to evaluate the request.

1. Plaintiff's Failure to Submit an Undertaking Before Filing Suit is Not Excusable It is undisputed that Plaintiff did not include an executed undertaking with the February 11, 2025 demand letter. Plaintiff initiated this action on September 25, 2025, and about two weeks later, submitted an undertaking. 57

D.I. 1 ¶ 28; D.I. 15 at 7. 55 See D.I. 1, Ex. A, art. Eleventh § 2(B); D.I. 15 at 17-18. 56 See D.I. 1 at 19 (The Complaint is dated September 24, 2025.); see D.I. 9 (The 57 undertaking was not submitted until October 14, 2025.).

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Under the contractual framework described above, Plaintiff had not made a valid demand at the time he filed suit. Accordingly, the contractual predicate for 58 Defendant's performance was never satisfied. As a result, the twenty-day waiting period required by Section 2(B) had not been triggered, and Plaintiff's claims were premature. Since Plaintiff had not submitted an undertaking and had not triggered the contractual waiting period, he had no enforceable right to advancement at the time he filed the Complaint. Plaintiff argues that Delaware's policy favoring advancement supports excusing strict compliance with the contractual requirements in this case. Plaintiff 59 relies on decisions such as In re Genelux Corp. and Wong v. USES Holding Corp. in which the Court declined to penalize plaintiffs for procedural deficiencies relating to undertakings. Those authorities do not alter the analysis here. They instead 60

D.I. 1, Ex. A, art. Eleventh §§ 2(A)-(B); D.I. 22 at 10; D.I. 15 at 16-17 (because 58 Plaintiff failed to submit an executed undertaking, which under the governing instrument is a prerequisite to the corporation's obligation to advance expenses, and, as a consequence, failed to trigger the contractual twenty-day waiting period that must elapse before a claim for advancement may be brought). D.I. 14 at 19 (". . . Delaware law requires the Court to read the provision in favor of the 59 party seeking advancement."). See D.I. 20 at 2-4; see also Wong v. USES Hldg. Corp., 2016 WL 769043, at *2-3 (Del. 60 Ch. Feb. 26, 2016); see also In re Genelux Corp., 2015 WL 6390232, at *5 (Del. Ch. Oct. 22, 2015).

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reflect narrow, context-specific departures from strict enforcement that are not present in this case. In Genelux, the Court declined to dismiss an advancement action where the plaintiff failed to submit an undertaking before filing suit. But that decision arose 61 in a materially different context, as the action in Genelux was expedited and involved circumstances that justified prompt judicial intervention. The Court's willingness 62 to overlook the procedural defect was informed by those exigent conditions. 63 No comparable considerations are present here. Plaintiff waited about seven months after submitting the demand letter before filing suit. That delay undercuts 64 any suggestion that strict enforcement of the contractual requirements would produce an inequitable result or frustrate the purpose of advancement. To the contrary, the record reflects that Plaintiff had the opportunity to comply with the contractual framework before initiating litigation. 65

In re Genelux Corp., 2015 WL 6390232, at *5. 61 Id. 62 Id. ("I do not find Genelux's argument persuasive. Because this action relates to the 63 somewhat expedited 205/225 Action and has been expedited itself, in part, I conclude that it would exalt form over substance to dismiss this action based on the fact that it was filed before Szalay submitted evidence of his expenses and a written undertaking."). See D.I. 1 ¶ 7 (Plaintiff sent his formal demand letter to Defendant on February 11, 2025, 64 but did not file his Complaint until September 24, 2025.); D.I. 14 at 9. D.I. 22 at 2 ("At any point in the seven months between sending the February Letter and 65 filing the Complaint, Plaintiff could have executed and submitted an undertaking.

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The Wong case also does not compel a different outcome. The Court in Wong held that "[u]ntil Plaintiffs perfected their requests for advancement by providing the undertakings, they had no right to advancement or to fees on fees because USES had no obligation to advance any amount to Plaintiffs." 66 First, Wong does not resolve the threshold issue presented here. In that case, the parties stipulated to the plaintiffs' entitlement to advancement, and the Court therefore did not confront whether the plaintiffs had satisfied the contractual prerequisites necessary to establish such entitlement. Instead, the Court's analysis 67 assumed that advancement was warranted and focused on implementing that right and establishing a procedure for resolving disputes over the requested fees. 68 Accordingly, Wong offers limited guidance where, as here, the dispositive question is whether Plaintiff has established a present entitlement to advancement under the governing instruments.

Inexplicably, he elected not to, instead filing an unsigned form undertaking with the Complaint.") (emphasis omitted). Wong v. USES Hldg. Corp., 2016 WL 769043, at *1 (Del. Ch. Feb. 26, 2016). 66 See id. ("Counsel have submitted a stipulated form of order that resolves most of the 67 otherwise open issues, including entitlement to advancement . . . "). See id. ("The first issue involves 'fees on fees'; the second issue involves allocation of 68 the Special Master's costs.").

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Wong emphasizes that advancement--and any ancillary right to fees-on-

fees--depends on compliance with the contractual conditions that give rise to that entitlement. The Court there made clear that a corporation has no obligation to 69 advance litigation expenses until the indemnitee has properly demonstrated a right to advancement, including by satisfying any undertaking requirement. Until those 70 conditions are met, the indemnitee has neither a right to advancement nor a basis to recover fees incurred in pursuing that relief. 71 Taken together, Wong does not support excusing Plaintiff's noncompliance. Rather, it reinforces that contractual prerequisites define when an advancement right arises. As such, Plaintiff's delay further undermines any claim of urgency or inequity that might justify excusing compliance. For these reasons, the Court declines to invoke Delaware's pro-advancement policy to override the contractual requirements set forth in Article Eleventh of the governing documents, and grants Defendant's motion to dismiss.

Id. 69 Id. 70 Id. 71

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1. Plaintiff's Motion for Summary Judgment Plaintiff also moves for summary judgment on his advancement claims. "As in most advancement disputes, summary judgment practice is an efficient and appropriate method to decide this case, as the relevant question turns on the application of the terms of the corporate instruments setting forth the purported right to advancement and the pleadings in the proceedings for which advancement is sought." 72 The Court has concluded that the Complaint must be dismissed because Plaintiff failed to comply with the contractual prerequisites to bringing suit under Article Eleventh. In particular, Plaintiff did not submit an executed undertaking 73 and did not trigger the contractual waiting period before initiating this action. 74 Because those deficiencies are dispositive, the Court does not reach the merits of Plaintiff's claimed entitlement to advancement. Summary judgment presupposes the existence of a properly asserted and justiciable claim. Where, as here, the

Weinstock v. Lazard Debt Recovery GP, LLC, 2003 WL 21843254, at *2 (Del. Ch. Aug. 72 8, 2003). D.I. 1, Ex. A, art. Eleventh §§ 2(A)-(B); D.I. 15 at 17. 73 See D.I. 1 at 19 (Plaintiff filed his Complaint on September 24, 2025); see generally 74 D.I. 9 (Plaintiff did not submit the signed undertaking until October 14, 2025).

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underlying claim is premature and subject to dismissal, so there is no basis on which to grant summary judgment. Accordingly, Plaintiff's motion for summary judgment is denied. Additionally, because Plaintiff has not succeeded on the merits of his advancement claims here, his request for attorneys' fees incurred in prosecuting this action is denied. 75

1. CONCLUSION For the reasons above, Defendant's motion to dismiss is GRANTED and advancement is DENIED without prejudice. Plaintiff failed to comply with the contractual prerequisites governing advancement under Article Eleventh, including the requirement to submit an executed undertaking and to observe the contractual waiting period before initiating suit. Because those deficiencies render Plaintiff's claims premature, the Complaint cannot proceed. In light of that disposition, Plaintiff's motion for summary judgment is DENIED as moot, and Plaintiff's motion for default judgment is DENIED because Defendant appeared and defended this action by filing a motion to dismiss. Plaintiff's request for fees-on-fees is also DENIED, as Plaintiff has not succeeded on the merits of his advancement claims.

D.I. 1 ¶¶ 65-71. 75

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Judgment shall be entered in favor of the Defendant unless expedited exceptions are timely filed under Court of Chancery Rule 144. Respectfully submitted,

/s/ Loren Mitchell

Magistrate in Chancery