Czechoslovak Group A.S. v. SARN SD3 LLC

IN THE SUPREME COURT OF THE STATE OF DELAWARE SARN SD3, LLC, §

§

Plaintiff Below, § Appellant/Cross-Appellee, § Nos. 291, 2023 & 294, 2023

§

v. § Court Below: Superior Court

§ of the State of Delaware CZECHOSLOVAK GROUP A.S., §

§ C.A. No. N17C-12-185 Defendant Below, § Appellee/Cross-Appellant. §

Submitted: July 10, 2024 Decided: September 12, 2024

Before SEITZ, Chief Justice; VALIHURA, TRAYNOR, LEGROW, and GRIFFITHS, Justices, constituting the Court en Banc.

Upon appeal from the Superior Court. AFFIRMED.

Mackenzie M. Wrobel, Esquire, Coleen W. Hill, Esquire, Duane Morris, Wilmington, Delaware; Ryan E. Borneman, Esquire, Robert M. Palumbos, Esquire (argued), Ryan F. Monahan, Esquire, Duane Morris, Philadelphia, Pennsylvania for Plaintiff Below, Appellant/Cross-Appellee.

Philip Trainer, Jr., Esquire, Tiffany Geyer Lydon, Esquire, Ashby & Geddes, Wilmington, Delaware; Of Counsel: Kenneth J. Pfaehler, Esquire (argued), Anna Isernia, Esquire, Dentons US LLP, Washington, D.C. for Defendant Below, Appellee/Cross-Appellant. VALIHURA, J.

I. INTRODUCTION

This appeal arises out of a breach of contract action brought by SARN SD3 LLC (“SD3”) against Czechoslovak Group A.S. (“CSG”). SD3 alleged that CSG breached an option contract for shares in RETIA A.S. (“RETIA”). RETIA is a Czech company purchased by CSG in 2016. The option contract provided that if CSG ceased to own a majority of RETIA before SD3’s call option expired, then CSG would pay SD3 a contractual “Penalty Amount” equal to 25% of the difference between the exercise price of 540,000,000 CZK and the value of RETIA based on an “Independent Valuation.” To determine the Independent Valuation, the two entities could either agree on RETIA’s value or, if that failed, each could hire a Big Four accounting firm that would conduct a valuation and the two valuations would be averaged.

CSG sold RETIA, triggering the Penalty Amount, and the parties fought over access to valuation information. SD3 filed suit. After the Big Four accounting firms issued their reports, SD3 sought summary judgment regarding the Penalty Amount. The Superior Court granted SD3’s entitlement to the Penalty Amount and calculated the underlying Independent Valuation as the average of the two valuations, over CSG’s objections that it should have been able to challenge SD3’s valuation methodology. In a later supplemental ruling, the court determined that SD3’s valuation had been independently determined and was the product of good faith and fair dealing.

Nearly a year-and-a-half after these rulings, SD3 brought a Rule 37 Motion for sanctions alleging that CSG had withheld important valuation documents, namely, the “J&T Documents.” SD3 believed that these documents contained information about a contract that would have increased the Independent Valuation amount and, in turn, the Penalty Amount. SD3 asked the court to allow the parties to “redo” their valuations so that the court could revise its summary judgment ruling. The court denied the motion finding that Rule 37 sanctions were not warranted and that the relief sought was better suited to an analysis under Rule 60(b) as to whether the J&T Documents were newly discovered evidence.

SD3 filed its Rule 60 Motion, which the Superior Court also denied. Following some additional limited discovery, the court found that the documents at issue were not newly discovered because SD3 had them in its possession for seven months before the court ruled on the Penalty Amount. Nor did the court find any exceptional circumstances warranting relief.

SD3 appeals the Superior Court’s denial of the Rule 37 and Rule 60 motions.1 In addition, SD3 challenges the Superior Court’s request that SD3 submit a proposed order in United States dollars (“USD”) rather than Czech crowns (“CZK”), and the Superior Court’s use of the conversion rate as of June 20, 2017 (“Valuation Date”) as the conversion rate for the Penalty Amount.

On cross-appeal, CSG challenges the two Superior Court summary judgment decisions below on multiple grounds, contending primarily that the Superior Court erred by entering partial summary judgment and by precluding full discovery.2

For the following reasons, we AFFIRM the judgment of the Superior Court.

II. RELEVANT FACTUAL AND PROCEDURAL BACKGROUND A. Underlying Facts3

1. The Parties SD3 is a Delaware limited liability company with its principal place of business in Washington, D.C. SD3 provides advisory and consulting services to companies in the defense industry.4 CSG is a Czech Republic holding company that operates and supports several enterprises in the defense industry. Non-party RETIA is a joint stock company registered under the laws of the Czech Republic. RETIA specializes in the field of military electronics, with an emphasis in radar and non-military recording systems.

2. The Call Option Agreement On March 30, 2016, CSG purchased RETIA for 540,000,000 CZK. Seven months later, on October 7, 2016, SD3 and CSG signed a Call Option Agreement (“Agreement”), which granted SD3 the option to purchase a 25% equity interest in RETIA.5 The Agreement provided that SD3 could exercise its option on or before July 1, 2021. If CSG ceased to own the majority of RETIA’s shares, then CSG was required to pay SD3 a contractually prescribed “Penalty Amount.”6 The Agreement states that the Penalty Amount equals 25% of the difference between the value of RETIA, based on an “Independent Valuation of the Company,” and the exercise price of 540,000,000 CZK.7 The exercise price was determined, in part, by the price that CSG paid for RETIA. Section 1.3 of the Agreement provides that “[t]he ‘Exercise Price’ of the Shares to be paid by the Grantee to the Grantor shall be equal to CZK 5,400.000 per 1% of the Shares, which is an amount calculated using the price that the Grantor paid to acquire the Shares.”8

Section 2.4 of the Agreement anticipated a change in control of RETIA. Specifically, Section 2.4.1 states:

2.4.1 If at any time during the Option period (i) the holder of a majority of Shares ceases to be the Grantor or a member of the group to which the Grantor belongs or the Company transfers a substantial part of its assets without adequate consideration, and (ii) the Grantee does not want to exercise its Option to purchase the Exercised Shares, the Grantors shall pay to the Grantee upon its written demand a contractual penalty equaling an amount in CZK (or its equivalent in US dollars) equal to 25% multiplied by the difference between (x) the value of the Company based on the “Independent Valuation of the Company”, as defined below, and (y) the valuation of the Company based on the Exercise Price (i.e. CZK 540,000.000) /the “Penalty Amount”/. To avoid any doubts, the Grantee is entitled to the Penalty Amount under the previous sentence only if conditions set out in the Article 2.4.1 point (i) have been met and if the value of the Company based on the “Independent Valuation of the Company” is higher than the value of the Company based on the Exercise Price.9 Section 2.4.2 of the Agreement defines “Independent Valuation of the Company” (“Independent Valuation”) as either (i) a value determined by mutual agreement of the parties within fourteen days following notice of change in control of RETIA; or (ii) if the parties are unable to agree upon RETIA’s value, the average of the valuations of RETIA by two Big Four accounting firms, one retained by CSG and the other by SD3. 10 Section 2.4.2 states in its entirety:

The Independent Valuation of the Company equals the valuation of the Company as agreed upon by the Grantor and the Grantee in writing on a date no later than 14 days following the initial notice of the Grantor to the Grantee of the change in control. In the event the Grantor and the Grantee do not reach an agreement within 14 days following such notice, each of the Grantor and the Grantee shall hire a Big Four accounting firm, and the Independent Valuation of the Company shall equal the average of the two valuations. Any cost and expenses of such accounting firms shall be borne equally by the Grantor and the Grantee.11

3. The Sale of RETIA On June 20, 2017, CSG sold RETIA to Technology CS, a company owned by CSG’s CEO, Michael Strnad,12 for 381,200,000 CZK. The purchase price was based upon a valuation of RETIA conducted by Grant Thornton.13 In connection with the transaction, J&T Banka requested information for the purpose of calculating a loan amount. Several months later, on November 5, 2017, CSG notified SD3 that CSG had transferred its shares in RETIA and was initiating the Independent Valuation of RETIA provided for in Section 2.4.2. SD3 thereafter requested documents concerning RETIA’s financial information “so that the parties [could] engage in a good faith discussion concerning the independent valuation of RETIA.”14 Characterizing SD3’s requests as sweepingly overbroad, CSG declined to provide SD3 with all of the documents it sought. Unable to agree upon RETIA’s valuation, CSG did not pay SD3 within the fourteen-day period.

B. Procedural History

1. The Complaint SD3 filed its original complaint on December 13, 2017. The Superior Court granted in part and denied in part CSG’s motion to dismiss the complaint on September 13, 2018. SD3 filed an Amended Complaint on September 28, 2018. CSG filed its Partial Answer on October 12, 2018, and then its Amended Answer and Counterclaim on February 25, 2019.

In Count I of the Amended Complaint, SD3 alleged that CSG had breached the Agreement in connection with determining the Penalty Amount.15 In Count II, SD3 alleged that CSG had breached a “contractual ‘fiduciary duty.’”16 CSG filed a counterclaim for defamation. The parties eventually settled Count II and the counterclaims.17 The only claim before this Court on appeal is Count I, concerning the Penalty Amount damages.

2. The Valuation Reports Consistent with Section 2.4.2 of the Agreement, SD3 and CSG each hired a Big Four accounting firm to conduct a valuation and produce a valuation report of 100% of shares of RETIA as of the Valuation Date, June 20, 2017. On July 24, 2018, SD3’s attorneys retained PricewaterhouseCoopers (“PwC”) on SD3’s behalf.18 On August 21, 2018, CSG retained Ernst & Young (“EY”).

The accounting firms did not agree on the value of RETIA. EY issued its report on March 5, 2019 (“EY Report”), estimating that the fair value of the 100% shareholding in RETIA at 555,000,000 CZK. Discovery disputes then interrupted the resolution of the valuation process.

During discovery, CSG produced a copy of the EY Report to SD3’s litigation counsel but designated it as “Highly Confidential.”19 Given that designation, SD3 could not access or review the EY Report, nor could PwC speak with SD3 concerning assumptions or approaches taken by EY in the EY Report. After SD3 made repeated requests to remove that designation and filed a Motion to Vacate Confidentiality Designations, the Superior Court, on October 28, 2019, ordered CSG to re-designate the EY Report from “Highly Confidential” to “Confidential” and to produce it to SD3 in unredacted form.20 CSG finally produced the re-designated EY Report on November 15, 2019.

PwC made its first formal document request to RETIA on November 14, 2019.21 Further discovery skirmishes necessitated a telephonic hearing held on December 20, 2019.22 The court extended the January 17, 2020 deadline for PwC to produce its report to March 3, 2020.

On January 8, 2020, SD3 filed a Motion to Compel Discovery. On January 10, 2020, CSG filed a Motion to Compel Discovery. The parties resolved the cross-motions to compel by an agreement reached around February 10, 2020. 23 On February 19, 2020, SD3 specifically requested the documents at the center of this dispute, namely, “[c]ommunications with J&T Banka or Commerzbank regarding financing for CSG or RETIA, including the financing of Michal Strnad’s purchase of RETIA from CSG, including the current loan agreement, the application to obtain financing, and the decision to provide financing.”24 Before CSG could respond to this request, PwC issued its report on March 10, 2020 (the “PwC Report”). The PwC Report determined RETIA’s value on June 20, 2017 to be 980,000,000 CZK, an 81% increase over the exercise price provided in the Call Option Agreement and more than 75% higher than the Independent Valuation prepared by EY.25

Thereafter, on May 22, 2020, in response to that February 19 request, CSG delivered over 12,000 documents. Although this production occurred after SD3’s production of the PwC report and after SD3 had filed its motion for partial summary judgment, the general deadline for discovery at that time was June 19, 2020, and the deadline for dispositive motions was not until October 9, 2020.26 Thus, SD3 filed its summary judgment motion before the dispositive motion deadline and before receiving the J&T Documents it had explicitly requested.

A principal driver of the discrepancy between the EY Report and the PwC Report was PwC’s consideration of a potential contract between RETIA and an Israeli company, ELTA (the “MADR contract”).27 The J&T Documents contained information concerning the MADR contract. These documents consisted of an email with attachments transmitted from CSG’s Head of Treasury to J&T Banka on June 19, 2017, the day before the Valuation Date.28 SD3 would later argue in its Rule 37 motion that these documents consisted of a “RETIA-prepared business plan for the period 2017–2021” and showed that “RETIA considered and represented to a banking authority, specifically for purposes of inducing that lender into making a loan, that the full value of the MADR Contract should be calculated as part of RETIA’s value.”29 PwC assessed the probability that the contract would be entered into by June 20, 2017 at 100%. CSG would later challenge that assumption and the relevance of the J&T Documents.30

3. Motion for Partial Summary Judgment On March 30, 2020, SD3 filed its motion for partial summary judgment concerning the Penalty Amount claim. According to SD3, there was no genuine issue of material fact in dispute because (1) neither party disputed the valid and enforceable nature of the Agreement; (2) neither party disputed that CSG had triggered its obligation to pay a penalty amount by selling RETIA; and (3) the damages were easily calculable under the Agreement.31 SD3 then calculated the Penalty Amount using the formula set forth in the Agreement, at “56,875,000 CZK[.]”32 SD3 additionally requested prejudgment interest of $508,568.25 USD, for a total of $3,016,284.30 USD.

In its May 14, 2020 opposition, CSG argued that the PwC Report was not a valuation report, but instead, was a litigation-driven expert report. It asserted that SD3 had failed to produce the underlying documents relied upon by Qureshi, and that the communications between Qureshi, SD3, and SD3’s attorneys would show that the PwC valuation was not independent.33 CSG argued that “Section 2.4 is not an arbitration provision,” and that the at B4692, Tab 85 (Second PwC Report at 9). The MADR servicing project was included in May and July 2017 management reports and mentioned in the media. Id. at B4692–93, Tab 85 (Second PwC Report at 10). This inclusion caused the increase in valuation from 980,000,000 CZK to 1,526,000,000 CZK. court did not simply have to accept the reports without challenge.34

CSG pointed to the inclusion of the MADR contract and weighting it with a probability of 100% as of June 20, 2017 as a key flaw in PwC’s report. SD3 had pled in its Amended Complaint, filed in September 2018, that the MADR contract “remained unsigned.”35

In its June 15, 2020 reply brief, SD3 argued that PwC’s independence was not reasonably in dispute.36 SD3 relied on Qureshi’s representations of independence in the PwC report, and submitted a declaration from him (the Declaration of Abdul Sirshar Qureshi) (“Qureshi Declaration”)37 signed June 12, 2020. CSG asserted in its Sur-Reply Brief that it should be allowed to challenge the Qureshi Declaration through discovery. On appeal, CSG contends that it was sandbagged by SD3’s reply brief submissions and should have been granted full discovery.

On December 23, 2020, the Superior Court deferred in part and granted in part SD3’s motion for partial summary judgment (“2020 S. J. Decision”).38 The court stated that there was no dispute “that CSG triggered its obligations under Section 2.4 and has now breached the Agreement by failing to pay the Penalty Amount.” 39 It held that “[t]he Agreement unequivocally states ‘the Independent Valuation of the Company [i.e., RETIA] shall equal the average of the two valuations.’”40 The Exercise Price was 540,000,000 CZK. Because “EY valued RETIA at 555,000,000 CZK” and “PwC valued RETIA at 980,000,000[,]” the Superior Court calculated the Independent Valuation to be 757,500,000 CZK.41 The Penalty Amount, 25% of the net difference of the Independent Valuation and the Exercise Price, came to 56,875,000 CZK.42

The court disallowed discovery into the methodologies undergirding the PwC report. It found this limitation to be consistent with the “plain and unambiguous language of section 2.4.2.” because:

Instead of calling for discovery and disputes, Section 2.4.2 provides that the Independent Valuation of the Company shall be the average of the two valuations. Moreover, Section 2.4.2 does not anticipate “independent” valuations by the two Big Four accounting firms. Instead, Section 2.4.2 just uses valuation without the using the term “independent valuations,” and has each party paying for the costs associated with their retained Big Four accounting firm.43

The court concluded that “the ‘Independent Valuation’ relevant to this dispute is the average of two valuations completed by Big Four Accounting Firms.”44 The court also noted CSG’s inconsistent litigation positions, observing that CSG originally “took the position that SD3 could not challenge the independent valuation reached by EY or to assert that EY’s valuation was calculated improperly” but now argued that CSG should be permitted to challenge the independent valuation reached by PwC or to assert that PwC’s valuation was calculated improperly.45

When considering whether to allow additional discovery into the “independence” of the report and whether it had been issued in “good faith,” the Superior Court considered the Qureshi Declaration. It found that the statements in the Declaration were “strong indicators of the independence of Mr. Qureshi and PwC,” and that it had “no reason to believe that Mr. Qureshi would make improper declarations or sacrifice the reputation of PwC over this litigation.”46 However, because a number of the statements in his Declaration were “inconsistent with the PwC Retainer Agreement provisions[,]” the court allowed CSG to “test the inconsistencies in discovery.”47 Although the court did not allow CSG to “attack the method of calculating the valuation” it did allow “LIMITED discovery relating to the implied covenant of good faith and fair dealing on the declarations listed above and the PwC Retainer Agreement.”48 CSG was permitted “no more than 3 document request[s] (including subparts) and a four-hour deposition of Mr. Qureshi.”49 The court deferred ruling on the remainder of the summary judgment motion pending this discovery.

4. The November 15, 2021 Supplemental Decision On February 12, 2021, after CSG concluded this limited discovery, SD3 filed its Supplemental Submission Regarding the Independence of PricewaterhouseCoopers. 50 It argued that the additional discovery confirmed that Qureshi and PwC were independent, that his new deposition testimony was consistent with the declaration, and that the PwC report was Qureshi’s “own and independent” valuation opinion.51 Therefore, SD3 requested the court grant the deferred portion of SD3’s motion for summary judgment and award the Penalty Amount, pre- and post-judgment interest, and attorneys’ fees and costs.

CSG responded that Qureshi was not disinterested, and that even the limited discovery allowed revealed sufficient questions justifying fuller discovery. It pointed to the type and frequency of communication between Qureshi, SD3’s representatives, and SD3’s counsel as constituting an improper influence over the valuation process.

On November 15, 2021, the Superior Court issued its opinion on the deferred portion of the summary judgment motion, holding that the PwC Report was not the product of a breach of good faith and fair dealing (the “2021 Supplemental Decision”).52 Even though PwC had been hired through SD3’s litigation counsel, the record failed “to support a conclusion that PwC was improperly influenced by SD3, its agents, or its litigation counsel in arriving at the valuation in the PwC Report.”53 The court found that “[a] fair reading of the discovery here shows that the PwC Report does not breach a duty of good faith and fair dealing.”54 Additionally, it found that “[m]uch of the ‘innuendo’ or implication of influence is the result of the litigation and not a demonstration of bad faith.”55 The court also reviewed the PwC Retainer Agreement and “found that it seemed to indicate that SD3’s litigation counsel will have input on valuation.”56 However, “Mr. Qureshi testified that SD3 did not influence the PwC Report’s valuation. The record shows that Mr. Qureshi did independently evaluate RETIA. The record also shows that PwC was not dominated or controlled by SD3 when it came to the PwC Report.”57

5. Rule 37 Order June 8, 2022 Although the J&T Documents had been produced to SD3 on May 22, 2020, it was not until March of 2022 that SD3’s expert, PwC, identified what SD3 calls the J&T Business Plan (“J&T Documents”). PwC “discovered” the J&T Documents while preparing its expert report on Count II.58 As noted, the documents were produced before the argument on summary judgment held on August 21, 2020, and the production preceded the December 23, 2020 summary judgment ruling by seven months and preceded the supplemental summary judgment ruling by eighteen months.

Nearly a year-and-a-half after the 2020 S. J. Decision, SD3 filed a Rule 37 Motion for Sanctions on April 22, 2022 challenging CSG’s “late” production of the J&T Documents.59 According to SD3, CSG’s May 22, 2020 production of the J&T Documents was a discovery violation and warranted a sanction in the form of an order requiring “PwC and EY to re-do their Section 2.4.2 valuations of RETIA to consider the J&T Business Plan, and for EY to further consider CSG’s responses to PwC’s inquiries.” 60 SD3 also sought fees and costs.

In its May 17, 2022 brief opposing sanctions, CSG argued that there had been no explicit request for the J&T Documents prior to the February 19, 2020 request.61 The February 19 request followed the motions to compel that were resolved by agreement, as the parties informed the Superior Court on February 10, 2020. CSG also asserted that the “business plan” was not a “valuation” and was not created as a part of RETIA’s budgeting and business planning. As such, the J&T Documents were not within the ambit of any prior request and CSG had not violated any order of the court. Rather, SD3 had filed for summary judgment before the deadline for dispositive motions and then argued against CSG’s request to finish Count I discovery on the scheduled timeline. CSG also argued that, in any event, the J&T Documents were not a basis for Qureshi to change the PwC report because the PwC report already considered the MADR contract.

The Superior Court held oral argument on the sanctions motion on May 23, 2020.62 The court chastised the parties for not accurately describing its prior rulings. 63 The court was specifically referring to the fact that it had not ordered in October and December of 2019 that discovery be completed on Count I.64 Instead, the court explained that:

What I did was, in order to get the process going forward so that you could get relief on Count I, is I made sure that you got the ability to have your expert produce the report, which could then be averaged so that we could come up with the independent valuation. And that is what I am talking about in how we represent what happened here.65 On June 8, 2022, the Superior Court denied SD3’s Motion for Sanctions for Non- Compliance with Discovery Orders (“2022 Decision”). The Superior Court did not find cause to grant the relief under Rule 37 in the form of reversing its prior decision. Although the Superior Court denied the motion under Rule 37, it did allow some limited additional discovery in an effort to clarify the nature and purpose of the J&T Documents:

[I]f SD3 wants to seek relief under Civil Rule 60, SD3 is entitled to a Rule 30(b)(6) deposition of CSG regarding the “J&T Business Plan” (as defined in the Motion) so that SD3 can clarify whether the J&T Business Plan is a document containing a “[Retia]-prepared business plan for the period 2017- 2021” or is, to use CSG’s characterization, a document created by CSG for J&T Banka for a loan and does not contain a Retia prepared business plan “as part of Retia’s contemporaneous budgeting and business planning.”66

6. Rule 60 Opinion on April 23, 2023 After SD3 conducted the permitted discovery, and as suggested by the court, on October 19, 2022, SD3 filed its Rule 60 Motion to Amend the Court’s 2020 S. J. Decision.67 In support of the motion, SD3 cited to the declaration of Ilona Kadlecová, a CSG representative, who stated that CSG had prepared the J&T Documents, not RETIA.68 At Ms. Kadlecová’s September 6, 2022, deposition, she testified that (a) RETIA representatives, including its then-CFO, a controller, and potentially its then-CEO, provided CSG with the initial data that made up the J&T Business Plan; and (b) it was important that J&T Banka agreed with the assessment of RETIA’s potential as of June 2017.69 Kadlecová summarized this collaborative creation as “some information came from RETIA, then it was reviewed and adjusted by the group [CSG]. And then it went back to RETIA and then again -- and then only after that it came -- it went to [J&T Banka].”70 PwC then prepared the Second PwC Report which valued RETIA at 1,526,000,000 CZK.71

SD3 argued that the J&T Documents were newly discovered evidence that CSG withheld, disavowed, and failed to provide to its own expert. According to SD3, withholding this document “incorrectly decreased RETIA’s value and Penalty Amount for Count I.”72 Thus, SD3 requested that the Court “amend the [2020 S. J. Decision] by re- calculating the Penalty Amount (without pre-judgment interest) using the average of the valuations reached in the First EY Report and the Second PwC Report at 129,625,000 CZK” and order CSG to pay all of SD3’s fees and costs.73

On January 18, 2023, CSG filed a brief responding to SD3’s Motion to Amend the Court’s Count I Summary Judgment. CSG argued that SD3 could have “discovered” the document (which SD3 had in its possession) using due diligence.74 CSG argued further that the J&T Documents were not withheld from PwC and were specifically turned over in response to the agreement between the parties following resolution and withdrawal of the motions to compel. Moreover, discovery on both counts was ongoing, yet SD3 chose to file for summary judgment before the deadline. As to the nature of the documents, CSG contended that additional discovery showed that the documents were not a RETIA- prepared business plan. Rather, the documents were prepared to allow Technology CS to obtain a loan in connection with the purchase of RETIA. The data was adjusted by CSG and represented “best-case scenarios[.]”75 In addition, the J&T Documents did not express any probability of project realizations, and Qureshi had used a 100% probability for the MADR contract, which was higher even than the 90% probability from a June 27, 2017 document after the Valuation Date.76

The Superior Court issued its opinion on April 27, 2023, denying SD3’s Rule 60 Motion (the “2023 Decision”).77 The court first addressed the question that the limited discovery (ordered after the Rule 37 hearing) was intended to answer, namely, whether the J&T Documents contained a RETIA-prepared business plan for 2017–2021, or whether they were created by CSG for J&T Banka for purposes of a loan. In summarizing its review of the discovery taken, including the Kadlecová depositions, the court determined that the documents fell somewhere in the middle:

[T]he J&T Business plan falls somewhere between how it is characterized by SD3 or CSG. The J&T Business Plan clearly contains financial information regarding RETIA; however, the J&T Business Plan does not appear to be “RETIA-prepared business plan for the period 2017–2021.”78

Nevertheless, it found that SD3 could not satisfy either Rule 60(b)(2) or Rule 60(b)(6).

The court determined that Rule 60(b)(2) did not apply because the J&T Documents were not newly discovered evidence and that “[t]he answer here lies in the undisputed timeline.”79 SD3 was “unable to show that it could not, in the exercise of reasonable due diligence, have discovered the J&T Business Plan before the Court issued the Decision and the Supplemental Decision.”80 Further, SD3 could not satisfy the more exacting Rule 60(b)(6) standard because SD3 failed to show “extraordinary circumstances.”81 SD3 had the J&T Documents in May 2020 and failed to identify them as relevant.82

7. The Conversion Rate and Date Issue SD3 submitted a proposed form of final judgment and order on May 23, 2023.83 Its proposed order requested a Penalty Amount of 56,875,000.00 CZK and 22,760,128.42 CZK in pre-judgment interest.84 The total requested amount was 79,635,128.42 CZK, plus post-judgment interest to accrue at 10.25% per annum.85 CSG filed a response objecting to SD3’s proposed interest calculations and interest rate.86 SD3 then submitted a revised form of order. There was more back and forth over the interest issues. SD3 submitted a revised form of order on July 18, 2023 with a judgment date of July 18, 2023.87

On July 19, 2023, the Superior Court emailed the parties stating that, “[o]ur case manager says that judgments must be in USD and not CZK. The order needs to have ‘a conversion identified’ on the order, i.e., somewhere in the judgment it has to be in USD. Please submit an order with USD.”88 On July 20, 2023, SD3 submitted the proposed order and stated in the accompanying email:

As explained in the footnote in the form, SD3 used the most recent exchange rate published by the U.S. government through the Treasury Reporting Rates of Exchange as of the date of the Order. SD3 believes that execution of the judgment was only ripe as of yesterday, and the value of the judgment should be calculated using yesterday’s published conversion rate. SD3 has not found any case law on point. Yesterday’s rate, however, is the logical choice. CSG neglected to make payment on June 20, 2017. While pre‐ judgment interest protected SD3 between June 20, 2017 and yesterday, an exchange rate is a neutral figure for shifting value on parties and reflects current markets as of the date of a judgment. Accordingly, because SD3 had no judgment to execute until yesterday, SD3 maintains that it has used the correct conversion rate in the attached form of Order.89 SD3’s Proposed Final Judgment accompanying this email stated:

IT IS HEREBY ORDERED, that judgment on Count I shall be entered in favor of SD3 and against CSG in the amount of 56,875,000.00 CZK (Penalty Amount) and 23,339,396.40 CZK (in pre-judgment interest) for a total judgment in the amount of 80,214,396.40 CZK, equivalent to 3,775,683.52 U.S. Dollars as of the date of this Order[.]90 CSG submitted a letter to the court in response, requesting the exchange rate be set as of the June 20, 2017 Valuation Date.91 CSG argued that SD3’s suggested date would result in SD3 receiving a windfall of approximately $375,000:

The Penalty Amount in [SD3’s] original form of Final Order and Judgment is simply a reflection of that determined value, as of that date, and there is no logical reason why that value – determined in Czech crowns – should be converted as of the date of judgment, a date the 6th Circuit Court of Appeals recognized as “arbitrary.”92 On August 23, 2023, the Superior Court entered judgment with a handwritten addition on the bottom of CSG’s letter:

So Ordered that the conversion rate at time of valuation, June 20, 2017, is the applicable rate. That rate plus pre- and post-judgment interest protects the expectations of the parties. This decision relies upon the reasoning in Ventas, Inc. v. HCP, Inc., 647 F.3d 291, 323 (6th Cir. 2011) (apply Restatement 3rd Foreign Judgments and Kentucky law). Plaintiff to submit new order.93 The final order and judgment reflecting this request was ordered on September 5, 2023, “in favor of SD3 and against CSG in the amount of 56,875,000.00 CZK (Penalty Amount), equivalent to 2,388,750.00 U.S. Dollars, and $998,808.36 (in pre-judgment interest) for a total judgment in the amount of $3,387,558.36[.]”94 The court added a footnote to its reference to “U.S. Dollars,” stating that “[p]er the Court’s Order dated August 23, 2023 (Trans. ID 70700242), the Treasury Reporting Rates of Exchange applied to this Order is 1.00 U.S. Dollar = 23.601 Czech Republic-Koruna as of June 20, 2017.”95 The court also ordered post-judgment interest.

III. ANALYSIS A. Whether the Superior Court Erred by Granting Summary Judgment

1. Contentions on Cross-Appeal We take up the cross-appeal issues first as they relate to issues arising earlier in the chronology than the issues raised on direct appeal. In its cross-appeal, CSG challenges numerous aspects of the 2020 S. J. Decision and 2021 Supplemental Decision. It argues that the court erred in granting summary judgment based on PwC’s expert’s report without permitting expert discovery or rebuttal testimony. CSG also contends that the court erred in treating Section 2.4.1 of the Agreement as an arbitration or exclusive remedy provision even though Section 7 of the Agreement confers jurisdiction on the Delaware courts to settle any disputes arising out of or in connection with the Agreement. Further, according to CSG, the court erred by ignoring the language of the Agreement requiring an independent valuation and in finding that as a result of asserting a general objection for the purpose of preserving a potential position early in the case, CSG was judicially estopped from challenging the valuation reports.

2. The Superior Court’s Contractual Interpretation is Correct We first consider CSG’s contentions that the Superior Court misconstrued Sections 2.4.2 and 7 of the Agreement and erred by precluding discovery into the methodology underlying the parties’ valuations. This Court reviews the Superior Court’s summary judgment decisions and contractual interpretation de novo.96

We hold that the Superior Court did not err in determining that Sections 2.4.1 and 2.4.2 are clear and unambiguous and that they do not reasonably contemplate an inquiry into the substance of the methodology underlying each side’s valuations. The Independent Valuation is defined as the “valuation of the Company as agreed upon by the Grantor and the Grantee in writing on a date no later than 14 days following the initial notice of the Grantor to the Grantee of the change in control.”97 If there is no agreement within fourteen days of the notice, “each of the Grantor and the Grantee shall hire a Big Four accounting firm, and the Independent Valuation of the Company shall equal the average of the two valuations.”98

The court correctly interpreted and applied this straightforward provision when it ruled that “Section 2.4.2 anticipates that the valuations from two Big Four accounting firms may be different,” and that “[i]nstead of calling for discovery and disputes, Section 2.4.2 provides that the Independent Valuation of the Company shall be the average of the two valuations.”99 The parties chose a simple method, where two reputable accounting firms each conducted an expert determination of the valuation which were then averaged and put into the contractually agreed upon Penalty Amount formula.

Section 7 does not undercut the conclusion that Sections 2.4.1 and 2.4.2 are clear and unambiguous. Section 7 states:

Governing Law. This Agreement and all disputes or controversies arising out of or relating to this Agreement or the transactions contemplated hereby shall be governed by, and construed in accordance with, the internal laws of the State of Delaware, without regard to the laws of any other jurisdiction that might be applied because of the conflicts of laws principles of the State of Delaware. Each of the Parties to this Agreement irrevocably agrees that the courts of the state of Delaware shall have jurisdiction to hear and decide any legal proceeding, and to settle any disputes, which may arise out of or in connection with this Agreement or its formation or validity and, for these purposes, each party irrevocably submits to the jurisdiction of the courts of the state of Delaware.100

Here, the Superior Court did address the dispute submitted to it.

The Superior Court’s resolution of the challenged provisions and the scope of inquiry into the determination of the Independent Valuation is consistent with our Delaware case law. Most notably, in an insightful analysis in Senior Housing Capital, LLC v. SHP Housing Fund, LLC,101 the Court of Chancery recognized a number of different contractual positions that parties might adopt regarding judicial review of a contractual valuation methodology set forth in an LLC Agreement. First, the parties could bargain for a de novo judicial determination of the value if the parties cannot agree. In other words, the parties “can omit any kind of appraisal provision from the contract and simply provide that one input to the formula is fair market value, and implicitly leave this court to resolve the dispute, because the contract provides no other method to resolve any disagreement.”102

Second, the parties could have the value determined by an expert, such as an investment bank or accounting firm, and designate that expert as an arbitrator for that purpose.103 A court would have only narrow grounds to set aside an arbitrator’s judgment, consistent with the limited form of judicial review available under the Federal Arbitration Act.104

Third, the parties could agree to use an appraiser to determine the value to be used as an input into a payout formula, and to have the value that will be used as a contractual input decided definitively and without substantive review by a contractually designated party. In such a case, there is no judicial review “if no provision for such review is provided in the contract itself.”105 A court may review whether the parties faithfully applied the formula, but it may not substantively review the appraiser’s determination of the value that the contract requires be used as an input into the formula.106 Such a substantive review would rewrite the contractually defined input and replace it “with a term supplied by judicial fiat and involving the appraiser’s result just being a starting point for a de novo judicial inquiry into value.”107

The parties might also choose to contract for the right to dispute an appraiser’s valuation through providing for additional appraisals if a party disagrees with the result. This is not an arbitration, like the Chancellor’s second option, although it requires the parties to be in dispute over the initial appraised value. The Court of Chancery, in Senior Housing Capital, LLC, considered the provision at issue to be of this type.108 This type of agreement should be treated in the same way as a process that contractually provides for a single appraisal without one party having to dispute it as “the contract does not contemplate any judicial review, because the iterative contractual process itself provides a definitive resolution.”109 In Senior Housing, the Court of Chancery held that the parties chose the third type of contract as the parties had bargained for appraisers to determine the value of the appraisals which served as inputs to the formula to determine the incentive distribution at issue.110

Accordingly, the Chancellor rejected the request that the court reach a de novo determination of value. Instead, the Chancellor held:

Where, as here, (i) a contract written by one party (ii) says that that party will make a payment based on a formula, (iii) the formula says that an input into the formula will be determined by an appraiser, and (iv) the party making the payment gets the contractual right to select the appraiser, the parties have clearly agreed to be bound by that appraiser’s professional judgment. Unless the party unhappy with the appraiser’s judgment can show that the appraised market value resulted from a concerted course of bad faith action between the appraiser and the other party—i.e., a breach of contract by a party—or that the appraiser’s result was otherwise tainted by the contractually improper conduct of the other party (such as intentionally providing the appraiser with false information to taint the valuation), the parties are stuck with what they bargained for. The lack of room for law-trained judicial second-guessing makes sense because such unschooled second-guessing undercuts the parties’ choice to have an expert on the relevant property type perform the task.111 De novo review would have been inconsistent with “the most central rule of contract interpretation,” namely, that “a contract must be interpreted in accordance with its plain terms as they would normally be understood.”112 Accordingly, the Chancellor declined the request to address valuation questions “and substitute his judgment in place of the contractually designated authority to set that contractual input.”113

However, the Court of Chancery found that it could consider “a claim that the integrity of the contractual appraisal process was compromised by the wrongdoing of one of the parties.”114 It determined that it “may only modify the appraisers’ determinations of Fair Market Value if one party can show that there has been a breach of the implied covenant of good faith and fair dealing.”115

Here, as in Senior Housing Capital, the parties bargained for and agreed to a method akin to the third option. SD3 and CSG bargained and agreed that each would use an appraiser from a Big Four accounting firm to determine the value of 100% of RETIA’s shares. The parties bargained and agreed to the inputs, the two valuations, and the formula, which would average the two valuations to determine the Independent Valuation. The Superior Court did not err by rejecting CSG’s arguments that the court could evaluate the PwC’s methodology or input numbers.116

Nor did the Superior Court err in permitting CSG the opportunity to conduct further discovery into whether there was a basis for a good faith and fair dealing claim. The limited review is consistent with that exercised by the Court of Chancery in Senior Housing Capital.

This leads us to CSG’s next challenge which is that the Superior Court erred in relying on a declaration by Qureshi submitted for the first time with SD3’s reply brief.117 CSG argues that a motion for summary judgment cannot be supported by purported evidence introduced for the first time with the reply brief. SD3 responds to this argument only in a footnote, calling this issue “inconsequential” because the Superior Court deferred its summary judgment decision as to PwC’s independence, allowing CSG to take certain discovery, including deposing Qureshi, after which the parties submitted supplemental briefing.

“‘[A] party opposing summary judgment may, pursuant to . . . Rule 56(f), request limited discovery if it cannot present facts essential to oppose the summary judgment motion.’”118 Rule 56(f) is discretionary, and should be considered under an abuse of estoppel issue, CSG’s initial position that the valuation could not be challenged aligns with the Superior Court’s holding that the plain language of the Agreement did not contemplate judicial inquiry into the parties’ valuation methodologies. discretion standard of review.119 The Superior Court properly permitted CSG to take limited discovery to see if there was a basis to CSG’s contentions that SD3 did not act with good faith or fair dealing.120

When CSG failed to uncover evidence that would support such a claim, the Superior Court properly found no breach of good faith and fair dealing. The Superior Court considered briefing and reviewed “the Supplements, including the entire deposition transcript of Mr. Qureshi. The Court also re-examined the record provided in support of the Motion.”121 The record before the court was extensive, and the Superior Court did not err by considering, relying upon, or quoting the Qureshi declaration in addition to the other record evidence. There was no abuse of discretion when the Superior Court ultimately concluded that “the record fails to support a conclusion that PwC was improperly influenced by SD3, its agents, or its litigation counsel in arriving at the valuation in the as is just.

Del. Super. Ct. Civ. R. 56(f).

PwC Report.”122 The court then supplemented its 2020 S. J. Decision and determined there was no improper SD3 influence on the PwC Report’s valuation and that Qureshi had independently evaluated RETIA. Accordingly, there was no error either in the court’s finding of no breach of the duty of good faith and fair dealing or in the process by which the court made that determination.123

In conclusion, summary judgment was appropriate, and CSG failed to demonstrate to the Superior Court that further discovery was required. The Superior Court’s role in determining the Independent Valuation was to apply the mathematical formula agreed to by the parties in Sections 2.4.1 and 2.4.2. The court fairly allowed for discovery limited to good faith and fair dealing issues. When CSG did not present anything to indicate that its claims were at all substantiated, the Superior Court properly granted judgment in favor of SD3.

B. Issues on Direct Appeal Now we turn to SD3’s appeal, concerning the Rule 37 and 60 decisions and the statutory currency issues.

1. Whether the Superior Court Erred by Denying Relief Under Rule 37

a. No Court Orders Were Violated

SD3 challenges the Superior Court’s 2022 Decision as a misapprehension of its authority to address CSG’s intentional failure to disclose the J&T Documents. SD3 says the trial court refused to consider the relief requested under the standards applicable to SD3’s Rule 37 motion and instead suggested that a motion under Rule 60 would be more appropriate. The problem, SD3 argues, is that Rule 60 applies only to final orders and the Count I summary judgment orders were non-final, interlocutory orders. Further, the court had full discretion pursuant to Rule 54(b), and its inherent powers, to revise, amend, or modify the 2020 S. J. and 2021 Supplemental Decisions at any time before entry of final judgment. SD3 asks us to remand so the Superior Court can “consider SD3’s procedurally proper motion under the correct legal standard.”124

CSG’s responds that it did not violate any existing order that could be remedied by Rule 37 sanctions, and that the Superior Court was correct to instruct SD3 that it was entitled to seek relief under Rule 60, if it so chose. CSG does not respond to SD3’s claim that the 2020 S. J. and 2021 Supplemental Decisions were not final.

The Superior Court has broad discretion regarding whether or not to impose discovery sanctions under Rule 37. Thus, we “will not disturb a trial [judge]’s decision regarding sanctions imposed for discovery violations absent an abuse of discretion.”125 We review de novo the Superior Court’s formulation and application of legal principles.126

We find no abuse of discretion with the trial court’s refusal to award Rule 37 sanctions. Superior Court Civil Rule 37(b) governs a party’s failure to comply with an order to provide discovery.127 SD3 does not point to an order that CSG disobeyed.128 At oral argument before this Court, SD3 only pointed to the October and December 2019 hearings.129 However, SD3 has not convinced us that CSG violated these orders.

The October 28, 2019 hearing addressed SD3’s Motion To Vacate Confidentiality Designations.130 In granting the motion, the Superior Court stated:

[T]his is the next thing that's going to happen is, you have to provide this to PriceWaterhouseCoopers, and anything that PriceWaterhouseCoopers says they need to do their 2.4.2 valuation, you have to give them.

Now, it can be designated highly confidential in the interim, okay, because that's what was contemplated by the parties, but I need the 2.4.2 valuation by PriceWaterhouse, and we're not going to block them as to how to do that. Now, we're going to put a time frame on when PriceWaterhouseCoopers is going to do this, because this litigation has been going on for a while, and it doesn't take PriceWaterhouseCoopers years to produce a 2.4.2 report, all right. So they better get their act together, and you better make sure they get original) (quoting In re Rinehardt, 575 A.2d 1079, 1082 (Del. 1990)). their act together because PriceWaterhouseCoopers is going to do a 2.4.2 report. And it's not going to be blocked by RETIA, and it's not going to be blocked by CSG, and it's not going to be blocked by Ernst & Young.131 The court did not order discovery to be completed on Count I as the transcript reveals — a point the court would firmly clarify at the later hearing held on May 23, 2022.132 Instead, it required CSG to remove the "highly confidential" designation from the EY Report and improve its cooperation with SD3 and PwC so that PwC could commence work on its valuation report. The court did order the PwC Report to be completed on or before January 17, 2020.133

Following that hearing, on November 14, 2019, SD3’s counsel sent CSG’s counsel its first formal request — a list of questions and requested information from PwC to RETIA.134 One of those requests was for the “latest Business plan and financial projections of the Company for the next 3 to 5 years[.]”135 PwC also requested a list of RETIA’s potential contracts, identifying MADR on its list of possible tenders:

30. Potential contracts – based on publicly available information, we identified a list of tenders that are not considered in the pipeline of forecasted revenues in the business plan or might not be considered in full. These are listed in the table below. While there is some information about the value of those opportunities/contracts, the share of Retia is mostly unknown. Please provide a full list of opportunities including expected revenues and probability of wining [sic] as at the Valuation date and indicate those, which are included in the above-mentioned business plan, file ref. number CSG- 000077.136 SD3 asked CSG to provide this information by early December 2019. PwC and CSG discussed the November 2019 requests by phone on December 19 and 20, 2019.137 After two phone discussions, PwC sent an updated information request on December 23, 2019.138 CSG, however, did not respond by SD3’s requested deadline.

On December 20, 2019, the court held a teleconference regarding the parties’ continued difficulties exchanging information. At the teleconference, the court explained how the valuation process had been complicated by the litigation:

And my ruling back then was, this is the orderly process that needed to be done and it's got to be done -- it should have been done without litigation because it was a contractual right that both parties agreed to, but that it was going to be necessary to the litigation. I went and read the decision, and I said it's a part of the contract that's necessary given the issues that are raised in the lawsuit.139

The court then granted a 45-day extension to March 3, 2020, for PwC to complete its report.140

After this teleconference, PwC began obtaining answers to questions from CSG’s principals concerning the EY Report. PwC made repeated requests of CSG and RETIA for financial information needed for the valuation effort. On January 9, 2020, PwC received the first batch of requested RETIA documents.141 Upon review of the January 9 documents, PwC sent additional requests on January 16, 2020.142 RETIA sent the requested documents on February 5, 2020.143 Ultimately, the court granted another short extension allowing PwC to complete its report on or before March 10, 2022.144

When CSG responded to SD3’s requests on January 9, 2020,145 it disavowed the existence of a CSG-created RETIA “business plan” stating:

In the introduction to the questions, you summarize our answers and mention that on January 9, 2020 we stated that the 3-years [sic] business plan had been prepared at RETIA and it had been approved by Mr Tichy [sic]. It seems that you translated or interpreted our answers incorrectly. It has been explained that the file reference number CSG-000077 is not a business plan [] created at RETIA, but it is a compilation of data obtained from RETIA[.]146 On January 8, 2020, SD3 filed a Motion to Compel Discovery. 147 On January 10,

2020, CSG filed a Motion to Compel Discovery.148 The parties resolved their cross- motions to compel on February 10, 2020. Then, in an email sent from SD3 to CSG on February 19, 2020, SD3 specifically requested “[c]ommunications with J&T Banka or Commerzbank regarding financing for CSG or RETIA, including the financing of Michal Strnad’s purchase of RETIA from CSG, including the current loan agreement, the application to obtain financing, and the decision to provide financing.”149

CSG responded to SD3’s February 19 request on May 22, 2020 with a production of over 12,000 relevant documents. This production included the J&T Documents. SD3, however, had issued the PwC Report on March 10, 2020 and then moved for partial summary judgment with respect to Count I of the claim on March 30, 2020, before CSG responded to SD3’s additional February 19 requests.150 At the time of SD3’s March 30, 2020 motion, the operative deadline for discovery was June 19, 2020.151

In summary, SD3 first specifically requested the J&T Documents from CSG on February 19, 2020, as part of the parties’ resolution to their cross-motions to compel discovery. Had SD3 reviewed the documents it had specifically requested from CSG at 1 (“I based my valuation on information in the EY report and in the supporting documents to the EY report, primarily the Business plan[.]”). before moving for partial summary judgment, it could have discovered the J&T Documents. The Superior Court did not, at the October or December hearings, order production to be completed on Count I. There was no order closing discovery on Count I, and the discovery deadline had been extended.152 Therefore, there was no error or abuse of discretion when the Superior Court held that there was no cause to grant the Rule 37 relief sought and that “the record is not clear that a discovery violation, if any, would warrant the type of relief sought[.]”153

2. The Superior Court Did Not Err by Denying Relief Under Rule 60 Superior Court Rule 60(b) provides relief from a final judgment or order. The standard of review of the Superior Court’s denial of a motion to reopen judgment under Rule 60(b) is abuse of discretion.154

SD3 sought relief under Rule 60(b)(2) and Rule 60(b)(6).155 “Because of the significant interest in preserving the finality of judgments, Rule 60(b) motions are not to App. to Answering Br. at B5603, Tab 92 (Opp. to Rule 60 Motion at 3–4 ¶¶ 6–7 (citing id. at be taken lightly or easily granted.”156 The question is whether the J&T Documents constituted “newly discovered evidence” within the meaning of Rule 60(b)(2). For the document to qualify as “newly discovered evidence,” the document must have been “in existence and hidden at the time of judgment[.]”157

Because the J&T Documents were in SD3’s possession seven months before issuance of the 2020 S. J. Decision, they were not newly discovered.158 Had SD3’s counsel exercised due diligence upon receiving the May 2020 production of documents, it would have discovered the J&T Documents. SD3 had ample time to present the document to the court before it issued its 2020 S. J. Decision. SD3 says the so called “two-track nature” of discovery should weigh in its favor. But that contention is not consistent with the Case Management Orders or with the October and December 2019 hearing transcripts.159 Nor is it consistent with the court’s own recollection of what it had ordered during those hearings.160

SD3 could have discovered the document well before the 2020 S. J. Decision. SD3’s failure to review the documents in its possession while summary judgment was pending does not support a conclusion that the documents were “newly discovered evidence.”

Nor are there any extraordinary circumstances that warrant relief under Rule 60(b)(6). This Court has held that a party must demonstrate “extraordinary circumstances” before a court will grant relief from judgment under that section.161 Rule 60(b)(6) functions as a catch-all provision, affording relief from the operation of a judgment “for any other reason” justifying relief.162

SD3’s argument that the COVID-19 pandemic constituted an “extraordinary circumstance” justifying the extraordinary relief fails. SD3 moved for summary judgment on March 30, 2020 — during the early days of the COVID-19 pandemic.163 Although courts have held that the COVID-19 pandemic may constitute an “extraordinary circumstance,” the COVID-19 pandemic may not justify relief where a lack of diligence is found.164 And COVID-19, as disruptive as it was, does not excuse SD3’s failure to review the documents that were in its possession for many months.

In addition, and although the parties did not join issue on this point, SD3 could not succeed on such a motion because Rule 60 only applies to a “final judgment, order, or proceeding.”165 At the time SD3 filed its Rule 60 motion on October 19, 2022, there was not yet a final judgment in this case. The final summary judgment order was issued on November 15, 2021.166 SD3 filed its Rule 37 Motion for Sanctions on April 22, 2022.167 The Superior Court denied the Motion for Sanctions on June 8, 2022.168 On July 28, 2022, the parties stipulated to a Partial Dismissal with Prejudice on Count II and CSG’s counterclaim.169 The stipulation was ordered on August 3, 2022.170 On July 3, 2023, this Court denied an appeal from the April 27, 2023 decision denying SD3’s motion to amend the 2020 S. J. Decision because it was an interlocutory appeal.171 We noted that the Superior Court’s docket reflected that the Superior Court had “not yet acted on the parties’ competing forms of final judgment and order[.]”172

In the end, SD3’s valuation was an 81% increase over the exercise price provided in the Call Option Agreement and more than 75% higher than the Independent Valuation prepared by EY. The MADR contract that SD3 complains of so vigorously was included in PwC’s initial evaluation and was admittedly “unsigned” in 2017.173 SD3 was awarded the Penalty Amount. The Superior Court did not err by denying relief under Rule 60.

C. Whether the Superior Court Erred When It Asked the Parties to Convert the

Judgment to United States Currency Using the Conversion Rate on the Valuation Date

1. Contentions on Appeal Finally, SD3 argues that the Superior Court committed a separate error when it required the parties to convert the Czech Penalty Amount award into U.S. currency. It points to a statute that it never brought to the Superior Court’s attention, namely, 10 Del. 169

Id. at B4613–14, Tab 83 (Stipulation of Partial Dismissal with Prejudice). C. § 5207(a). It argues further that the Superior Court compounded that error by using the exchange rate in effect as of the Valuation Date (June 20, 2017), rather than the exchange rate on the payment date required by another section of the same statute, namely, 10 Del. C. § 5205(a). CSG responds that SD3 waived the first issue. CSG contends that “[a]s the contract provided for payment and calculation in crowns, the conversion rate should be the rate at the date the payment became due, June 20, 2017[,]” because “[u]sing a current rate for the conversion (as opposed to for post-judgment interest) would result in a windfall to the plaintiff.”174

2. Standard of Review This Court reviews the interpretation of statutes de novo.175 SD3 did not invoke 10 Del C. § 5201, et. seq. in the proceedings below.176 SD3 could have raised the provision after the trial court informed the parties that the case manager required a judgment in U.S. currency. The Superior Court stated only that “[t]he order needs to have ‘a conversion identified’ on the order, i.e., somewhere in the judgment it has to be in USD. Please submit an order with USD.”177 This request did not preclude the parties from raising the statutory issues. Instead, the parties only argued about what the date of conversion should be. As far as the conversion date, SD3, on appeal, again relies on a provision of 10 Del. C. § 5201, defining conversion date:

(3) “Conversion date” means the banking day next preceding the date on which money, in accordance with this chapter, is: a. Paid to a claimant in an action or distribution proceeding; b. Paid to the official designated by law to enforce a judgment or award on behalf of a claimant; or c. Used to recoup, set off or counterclaim in different moneys in an action or distribution proceeding.178

But because SD3 did not invoke this statutory provision in the proceedings below, the Superior Court did not have a chance to rule on the statutory interpretation issues now raised for the first time on appeal. Any arguments now made about these statutory provisions are waived.

Additionally, we observe that throughout the litigation, SD3 asserted inconsistent positions concerning the currency for the Penalty Amount. Up until the May 2023 and July 2023 proposed judgments, SD3 referred to the Penalty Amount in both currencies, and used the Valuation Date as the operative date.179 In response to an interrogatory filed August 16, 2019, SD3 estimated its damages and listed a Penalty Amount of 25% in CZK, and the conversion to USD, without clarifying the conversion rate or date.180

In the PwC report, the analysts utilized conversion dates from the S&P Capital IQ database “as at the Valuation date.”181 SD3 requested the conversion rate as of the Valuation Date in its Proposed Order Granting SD3’s Rule 60 Motion to Amend the Count I Decision, listing the Penalty Amount in both CZK and USD, and writing “[u]sing the conversion rate as of the Valuation Date to be consistent with when pre-judgment interest begins to run.”182

In sum, the Superior Court’s holding addressed the issues as framed and presented by the parties and reflects a careful attempt to balance the interests in this case. We decline to consider any argument regarding statutes that the parties failed to bring to the attention of the trial court.

IV. CONCLUSION

For the reasons set forth above, we AFFIRM the Superior Court’s decision.