The Delaware Court of Chancery has awarded $85,172.50 in attorney fees to Patrick Judge in his case against Camber Road Partners, Inc. This ruling follows a successful motion to compel the release of an email that the defendants had previously withheld, claiming it was protected by attorney-client privilege. The decision is significant as it reinforces the rights of directors to access company information, even when it involves privileged communications.
Judge, who is also a director at Camber Road, filed the motion after the company’s counsel sent an email to other directors but excluded him. The court's ruling not only highlights the importance of transparency within corporate governance but also establishes a precedent regarding the limits of attorney-client privilege in similar cases.
Background
In the case of Patrick V. Judge v. Camber Road Partners, Inc., filed under docket number C.A. No. 2025-1217-CDW, the dispute arose over an email sent on April 18, 2025, by the company’s legal counsel. This email was directed to three of the four directors of Camber Road, excluding Judge. The defendants argued that the email contained privileged legal advice regarding board strategies, thus justifying its withholding from Judge.
On April 20, 2026, the court granted Judge's motion to compel, stating that the defendants could not assert privilege against him for the email. The court applied established case law that recognizes a director's right to access information pertinent to their role. Following this ruling, Judge's legal team filed applications for attorney fees and expenses incurred during the motion, which the defendants subsequently objected to.
The Ruling
In a letter dated June 10, 2026, Magistrate Christian Douglas Wright ruled in favor of Judge, awarding him the full amount of $85,172.50 for attorney fees. The court determined that the defendants' opposition to the motion was not substantially justified, as they failed to provide compelling reasons for withholding the email. The court stated, "Defendants have not shown that their opposition to the Motion was substantially justified or that there are other reasons it would be unjust to award plaintiff those fees and expenses."
The court emphasized that under Delaware law, fee shifting is mandatory unless the losing party can demonstrate substantial justification for their position. The judge noted that the defendants' arguments regarding good faith and the novelty of the legal issues did not meet the requirements for avoiding fee shifting. The court explained, "A losing party’s good faith by itself is not relevant under Rule 37(a)(4)(A)."
Impact
This ruling is significant for corporate governance as it reinforces the principle that directors have an inherent right to access company information, including privileged communications, unless there is clear evidence of a conflict of interest. The decision may encourage other directors to assert their rights to information without fear of unjustified denial based on privilege claims.
Additionally, the outcome of this case could influence future disputes regarding attorney-client privilege in corporate settings. It serves as a reminder that legal counsel's communications must be carefully considered, especially when they involve multiple directors who may have differing interests within the company.
What's Next
While the defendants have the option to appeal the ruling, details about any potential appeal were not available in the court filing. There are no related cases pending that directly address similar issues of attorney-client privilege in the context of corporate governance.