In Ogus v. SportTechie, C.A. No. 2018-0869-AGB. (Del. Ch. Jan. 31, 2020), the Delaware Court of Chancery refused to dismiss portions of seven claims brought by the jilted founder of SportTechie Inc. against corporate insiders and investors related to his removal from office and the purported repurchase of his equity stake in the company.
SportTechie, a news website focused on the interplay between sports and technology, was co-founded in 2012 by Simon Ogus and Taylor Bloom. In 2015, SportTechie was reorganized as a Delaware limited liability company, with Ogus owning 44.5% and Bloom owning 55.5% of the company. In October 2016, Oak View Group, a private equity fund, invested in SportTechie in exchange for a convertible note and a seat on the company’s board of directors. Later that year, SportTechie was converted to a Delaware corporation at the urging of Bloom, Daniel Kaufman, the company’s general counsel, and Francesca Bodie, Oak View’s soon-to-be designee on the company’s board of directors. Under the company’s limited liability company agreement, Ogus’ consent was required and obtained for both the Oak View investment and the conversion to a corporation. In connection with the conversion, Ogus also executed a written consent appointing Bloom, Bodie and a third individual (but not himself) to the SportTechie board. Finally, Bloom and Ogus executed a shareholders agreement that allowed SportTechie to repurchase Ogus’ shares within 90 days after the termination of his employment for any reason or no reason at a purchase price equal to the fair market value of the shares (as determined by the board).
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