A Delaware court has denied cross-motions for summary judgment in the case of Benjamin Snipes v. WorkCo, Inc. d/b/a Toku, C.A. No. 2026-0110-CDW, which involves a former high-level employee’s request for the advancement of legal fees. The court’s decision affects Snipes, who served as the Head of Legal for Toku, and raises important questions about corporate advancement rights and the status of officers within a company.

The case centers on Snipes' claim for the advancement of legal fees incurred while defending against a lawsuit filed by Toku. Snipes argues that he is entitled to these fees under Toku's bylaws, which grant advancement rights to officers and directors. Toku contends that Snipes is not entitled to advancement because the underlying lawsuit was dismissed and he was not an officer as defined by the company’s bylaws. The court’s ruling is significant as it clarifies the conditions under which advancement claims can be pursued.

Background

Benjamin Snipes is an attorney who worked as the Head of Legal for Toku from June 2023 until July 2024. Toku, a Delaware corporation, filed a lawsuit against Snipes in December 2024, alleging that he took confidential information when he left to work for a competitor, LiquiFi, Inc. The lawsuit accused Snipes of breaching confidentiality agreements, violating trade secret laws, and tortious interference, among other claims.

In December 2025, while the lawsuit was ongoing, Snipes demanded advancement of his legal fees from Toku, asserting that he was entitled to these fees under the company’s bylaws. Toku responded by arguing that the lawsuit's resolution rendered Snipes' claim moot and that he was not an officer as defined in the bylaws, which would preclude him from receiving advancement. The case was brought to the Court of Chancery of Delaware, where both parties filed cross-motions for summary judgment.

The Ruling

The court ruled that the resolution of the underlying lawsuit did not moot Snipes' advancement claim. The judge stated, "I conclude that resolution of the underlying action did not moot this action, and that there is a genuine issue of material fact whether the former employee occupied a covered position." The court emphasized that Snipes was still defending against claims until the lawsuit was formally dismissed, and therefore, he could still seek advancement for the fees incurred during that period.

Additionally, the court found that there was a genuine issue of material fact regarding whether Snipes qualified as an officer under Toku’s bylaws. The judge noted that neither party provided sufficient evidence to determine if Snipes was appointed to an officer role according to the bylaws, which could affect his entitlement to advancement. As a result, the court denied both parties' motions for summary judgment.

Impact

This ruling has important implications for Snipes and Toku. For Snipes, it means that he can continue to pursue his claim for advancement of legal fees, which could amount to significant expenses. For Toku, the decision underscores the importance of clearly defining officer roles and advancement rights in corporate bylaws. The case also highlights the complexities surrounding advancement claims, particularly when the status of an individual within a company is in dispute.

The court's ruling does not set a new legal precedent but reinforces existing principles regarding corporate advancement rights and the interpretation of bylaws. It serves as a reminder for corporations to ensure their bylaws are clear and comprehensive regarding the rights of officers and the conditions under which advancement is granted.

What's Next

Following the court's ruling, the parties are expected to confer and propose a scheduling order to resolve the entitlement issue. The case may still proceed to trial if the parties cannot reach a settlement. Additionally, Toku may consider whether to appeal the decision, although details on any potential appeal were not available in the court filing.