Nguyen v. View, Inc., CA 11138-VCS

Background

In 2009 View, Inc. closed a Series B preferred financing after obtaining Plaintiff Paul Nguyen’s conditional consent as part of a Settlement Agreement that included a seven-day revocation right.
Nguyen timely revoked his consent during the seven-day period; unbeknownst to him, View had already closed the Series B financing.
The parties submitted the dispute about the validity of Nguyen’s revocation and the Series B closing to arbitration; the arbitrator later ruled Nguyen’s revocation valid and declared the Series B closing void.
After the arbitration award, View sought to cure the void corporate acts (including the Series B closing) by ratifying them in early 2016 under 8 Del. C. § 204.
Nguyen sued seeking a declaratory judgment under 8 Del. C. § 205 that the 2016 ratifications were invalid; View moved to dismiss, which the Court denied, concluding Nguyen plausibly alleged the Series B closing was void and not amenable to cure under § 204.
View moved for reargument under Court of Chancery Rule 59(f); the Court denied reargument, finding View simply rehashed prior arguments and failed to identify any controlling law or misapprehension of facts.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether § 204 can retroactively ratify a corporate act deliberately declined/ rejected by the majority stockholder	Nguyen: A deliberate revocation by a majority stockholder is a rejection, not a mere failure of authorization, and is not eligible for § 204 ratification	View: § 204 covers any "failure of authorization," including where the corporation lacked actual ability at the time; acts need only be a type corporations are authorized to take	Court: Held revocation by majority is a deliberate rejection, not the kind of "failure of authorization" § 204 permits to be ratified; denied ratification at motion-to-dismiss stage
What "power to act" in § 204 requires — actual ability when the act was purportedly taken or mere general corporate authority	Nguyen: View lacked the power when the Series B closed because Nguyen’s timely revocation meant the corporation did not have authority at that time	View: The defective act need only be the kind corporations are authorized to take generally; no requirement of actual ability at the time	Court: Interpreted § 204 to require the act be within the corporation’s power at the time it was purportedly taken; Nguyen’s revocation meant View lacked that power
Whether a "failure of authorization" includes an express majority rejection	Nguyen: "Failure of authorization" is distinct from a majority "no" vote or deliberate rejection	View: The statutory term is broad and does not distinguish between types of failures to obtain authorization	Court: Rejection by a majority is distinct and cannot be retroactively ratified under § 204; treating rejections as ratifiable would nullify shareholders’ right to vote "no"
Whether grounds for reargument exist (misapprehension of law or facts)	Nguyen (implicitly): Court correctly applied § 204 and denied dismissal; no misapprehension	View: The Court misapplied § 204 and improperly excluded "rejected" acts from § 204 ratification scope	Court: Denied reargument — View failed to identify overlooked controlling law or misapprehended facts and merely rehashed prior arguments

Key Cases Cited

No key authorities cited in the opinion have official published reporter citations; the Court relied principally on the Delaware General Corporation Law and unpublished or WL decisions and prior transcripts referenced in the record.