Chancery Limits AMFI Stock Discovery Scope
Summary
The Delaware Court of Chancery issued a letter decision resolving exceptions to the Special Discovery Magistrate's January 16, 2026 Report in Mitchell Partners, L.P. v. AMFI Corp. The court sustained defendants' exceptions to limit plaintiff's stock ownership discovery, clarifying that plaintiff is not permitted discovery into stock ledgers of non-parties or defendants' knowledge of non-parties' ownership, except as it relates to Class B stock. Plaintiff's exceptions were overruled except for the request for verification of interrogatories.
What changed
The court modified the Special Discovery Magistrate's January 16 Report by limiting the scope of plaintiff's discovery into defendants' stock ownership. Specifically, plaintiff is now barred from discovering stock ledgers of non-parties or defendants' knowledge of non-parties' ownership of defendants' stock, except regarding Class B stock. Defendants' exceptions were sustained on this limited basis, while plaintiff's counter-exceptions were overruled except for verification of interrogatories.
For litigation parties involved in Delaware corporate disputes, this decision reinforces the court's approach to proportionality in discovery—limiting stock ownership discovery to party-owned shares and excluding non-party stockholder information. Corporate litigation practitioners should note that discovery into shareholder records of non-parties remains circumscribed in Delaware Chancery proceedings, requiring particularized showing for such discovery.
What to do next
- Comply with the modified discovery order
Archived snapshot
Apr 14, 2026GovPing captured this document from the original source. If the source has since changed or been removed, this is the text as it existed at that time.
COURT OF CHANCERY OF THE STATE OF DELAWARE
April 13, 2026
Re: Mitchell Partners, L.P. v. AMFI Corp. et al., C.A. No. 2020-0985-KSJM
Dear Counsel: This letter resolves the parties' exceptions to the Final Report and
Recommendation of the Special Discovery Magistrate on Plaintiff's Motions to
Compel dated January 16, 2026 (the "January 16 Report"). 1 In the January 16 Report, the Special Discovery Magistrate resolved Plaintiff's motion to compel Defendants to produce "documents reflecting any [including
Defendants'] direct and indirect ownership of and purchases and sales of [Defendants'] equity securities" by (i) Defendants themselves and (ii) certain
subsidiaries of AMFI that are not parties to this dispute. 2 The Special Discovery Magistrate granted Plaintiff's motion, modified as
follows: "To the extent not previously produced, Defendants shall produce documents
C.A. No. 2020-0985-KSJM, Docket ("Dkts.") 296, 297, 294 ("January 16 Report"). 1 Terms not defined in this letter have the same meaning as in the court's letter decision dated July 3, 2024. Dkt. 131.
- Bruce McNew Lisa M. Zwally Dkt. 283, Ex. A ¶¶ 53, 54; see also id. ¶ 3. 2Kevin D. Levitsky Bryan T. Reed Cooch and Taylor, P.A. Greenberg Traurig, LLP 1000 N. West Street, Suite 1500 222 Delaware Avenue, Suite 1600 P.O. Box 1680 Wilmington, DE 19801 LEONARD L. WILLIAMS JUSTICE CENTER KATHALEEN ST. JUDE MCCORMICK Wilmington, DE 19899 500 N. KING STREET, SUITE 11400 CHANCELLOR WILMINGTON, DELAWARE 19801-3734
C.A. No. 2020-0985-KSJM April 13, 2026 Page 2 of 2 in their possession, custody, or control referring to or reflecting the direct or indirect
ownership of any Class A or Class B shares of AMFI stock." Elsewhere in the 3 January 16 Report, the Special Discovery Magistrate stated that the permissible
scope of examination for depositions conducted by Plaintiff "includes examination
into the direct or indirect ownership of Class A or Class B shares of AMFI stock." 4 Defendants take exception to these provisions of the January 16 Report, arguing that they permit overbroad discovery and conflict with the court's January 28, 2026 rulings. 5
Defendants' exceptions are sustained for the limited purpose of clarifying that
Plaintiff is not permitted discovery into the stock ledgers of non-parties or
Defendants' knowledge of non-parties' ownership of the stock of Defendants, other
than as it relates to Class B stock. On the same basis, and for the reasons described by the court in its January 28 ruling, Plaintiff's exceptions are overruled other than to the extent Plaintiff requests verification of interrogatories, which is sustained. 6 IT IS SO ORDERED. Sincerely,
/s/ Kathaleen St. Jude McCormick
Chancellor cc: Register in Chancery All counsel of record (by File&ServeXpress) January 16 Report ¶ 6. 3 Id. ¶ 7. 4 Dkt. 307 at 16-17; see Dkt. 300 at 23:22-24:7, 26:6-8, 27:15-28:2. 5 Dkt. 304 at 3-4. 6
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