The Delaware Court of Chancery has ruled on a significant issue regarding the calculation of post-judgment interest in the case of William J. Brown v. Matterport, Inc., C.A. No. 2021-0595-LWW. The decision, issued on June 1, 2026, directly affects how interest on judgments will be calculated in the future, particularly in cases involving fluctuating interest rates. This ruling is important for both plaintiffs and defendants in civil cases, as it addresses how financial compensation is determined after a court judgment.
The case centers around William J. Brown, who had previously won a judgment against Matterport, Inc. The issue at hand was how much interest should accrue on that judgment after it was issued. The Delaware Supreme Court had previously affirmed the lower court's decision but sent the case back to the Chancery Court to specifically address the calculation of post-judgment interest. This remand was necessary to ensure that the interest calculation was fair and consistent with the law.
William J. Brown is the plaintiff in this case, while Matterport, Inc. is the defendant. The dispute arose after Brown won a judgment against Matterport, and the parties disagreed on the rate of interest that should apply to the judgment amount. Brown argued that the law mandated a higher fixed interest rate, while Matterport contended that a lower rate should be used to prevent an unfair benefit to Brown.
The case reached the Court of Chancery after the Delaware Supreme Court's decision on April 22, 2025, which affirmed the previous ruling but required a recalculation of the post-judgment interest. The Supreme Court's ruling indicated that the Chancery Court had the discretion to determine the rate of interest and how it should be compounded. This left the door open for the Chancery Court to make a decision that would balance the interests of both parties.
In the ruling, Vice Chancellor Lori W. Will addressed the arguments presented by both sides. Brown argued for a fixed interest rate of 10.50%, based on the Federal Discount Rate in effect at the time of the judgment. On the other hand, Matterport argued that the court should maintain the previously used rate of 5.25% to avoid giving Brown an unfair advantage.
The court ruled that neither a fixed 10.50% rate nor a fixed 5.25% rate was appropriate. Vice Chancellor Will stated, "A fixed 10.50% rate would create an inequitable windfall for Brown and effectively operate as a sanction for conduct I previously held stemmed from a good-faith misunderstanding." The court recognized that allowing the defendants to retain the judgment amount at a fixed 5.25% rate would not adequately compensate Brown for the loss of the use of his funds.
Instead, the court decided on a floating rate for post-judgment interest, which would be set at 5% over the Federal Reserve discount rate. This rate will fluctuate and be compounded quarterly. The court noted that this approach better reflects the economic realities and significant fluctuations in interest rates during the relevant period. Vice Chancellor Will explained, "Applying a floating rate compounded quarterly appropriately accounts for the economic realities and significant fluctuations in interest rates during the relevant period."
Additionally, the court denied Brown's request to apply the same floating rate to prejudgment interest, as the Supreme Court had already affirmed the 5.25% rate for that portion. The court also rejected Matterport's request to stop the accrual of post-judgment interest as of June 1, 2025, stating that the defendants could have halted interest accrual by satisfying the judgment but chose not to do so.
This decision has significant implications for future cases in Delaware and potentially beyond. The ruling sets a precedent for how courts might handle interest calculations in cases where the judgment amount is contested and where interest rates are volatile. It emphasizes the court's role in ensuring that interest calculations are fair and equitable, taking into account the financial realities faced by both plaintiffs and defendants.
Moving forward, this ruling will affect how parties approach settlements and judgments in similar cases. Plaintiffs may feel encouraged to pursue higher judgments knowing that interest rates can be adjusted more favorably in their favor, while defendants may need to be more strategic in how they manage their financial liabilities in light of fluctuating interest rates.
As for what happens next, the parties involved in the case are required to confer on a timeline for the payment of the judgment and to file a proposed final order that includes the interest calculation consistent with the court's decision. This proposed order must be submitted within 20 days of the ruling. There is no indication in the court filing that the ruling can be appealed, but the parties may seek further clarification on the payment terms.