Symbiont Breach of Contract Suit

Compass Lexecon’s client Symbiont.io, Inc. (Symbiont) entered into a joint venture agreement (JVA) with Ipreo Holdings, LLC (Ipreo) that was implemented through a separate entity, Synaps Loans LLC (Synaps). Subsequently, Ipreo was acquired by IHS Markit (Markit). Symbiont filed suit alleging that Ipreo breached the non-competition provision in its JVA when Ipreo was acquired by Markit because Markit had a business that competed with Synaps called ClearPar that Symbiont claims should have been run through Synaps, as described in the JVA.

In August 2021, Vice Chancellor Laster of the Delaware Chancery Court issued a 129-page memorandum opinion in favor of Symbiont finding that Ipreo breached the non-competition provision in the JVA and awarding Symbiont its share of the after-tax profits of Markit’s ClearPar business from August 2, 2018 (the date Markit’s acquisition of Ipreo closed) through November 30, 2020. The Court noted that “Symbiont’s share of a liquidating distribution will likely be in the vicinity of $70 million,” which is based on a damages calculation proffered by Compass Lexecon Executive Vice President Rajiv B. Gokhale. In addition, to support that such a damages award was not “an unconscionable result,” the Court relied on Mr. Gokhale’s alternative estimate of damages – two discounted cash flow analyses that the Court described as using “conservative assumptions” and “reasonable set[s] of inputs.”

Compass Lexecon worked closely with counsel from Paul, Weiss, Rifkind, Wharton & Garrison LLP, including Andrew Gordon, Jaren Janghorbani, Daniel Mason, and Maia Usui. Mr. Gokhale was assisted by a Compass Lexecon team consisting of Adel Turki, Cliff Ang, and Andrew Linde.