The Mrs. Fields Brand, Inc. v. Interbake Foods LLC
CA 12201-CB
| Del. Ch. | Jan 5, 2018Background
- Mrs. Fields sued Interbake under a 2012 Trademark License Agreement after Interbake purported to terminate the agreement; a six-day trial was held.
- The Court issued a 107-page Opinion: it sustained Mrs. Fields on part of Count I (termination) and ruled for Interbake on Mrs. Fields’ claims for monetary damages, dismissed one claim as unripe, and resolved counterclaims largely for Interbake.
- The License Agreement contains a fee-shifting clause (Section 22(j)) awarding the prevailing party reasonable fees and expenses incurred to enforce the agreement.
- Both parties sought fees after the Opinion: Interbake requested ~$2.7M; Mrs. Fields requested ~$5.37M; each opposed the other's request.
- The court applied the Delaware “predominance in the litigation” standard (Brandin line) to decide who, if anyone, was the prevailing party under the contract.
- The court found two equally core issues: (1) validity of Interbake’s termination (resolved for Mrs. Fields); and (2) Mrs. Fields’ claim for substantial monetary damages (resolved for Interbake). Because neither side predominated, the court denied both fee applications.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a party prevailed under the contract’s prevailing-party clause | Mrs. Fields: She prevailed because termination was invalid and sought fees | Interbake: It prevailed because it defeated Mrs. Fields’ claim for damages | Neither prevailed; litigation split on two equally core issues, so no fee award |
| Proper standard for "prevailing party" under the contract | Mrs. Fields: Apply Brandin predominance standard to find prevailing party | Interbake: Same—predominance governs | Court applied Brandin’s "predominance in the litigation" standard (holistic, not claim-by-claim) |
| Whether the court should parse success claim-by-claim for fee award | Mrs. Fields: Favor finding prevailing party based on key wins | Interbake: Argue its damage victory is dispositive | Court rejected claim-by-claim parsing; used holistic chief-issue approach and found no predominance |
| Whether Mrs. Fields could further amend to add new damages claims post-judgment | Mrs. Fields: Sought leave to amend to assert two new damages claims | Implied Interbake: Opposed reopening final litigation (not yet filed in response) | Court questioned the propriety of reopening a concluded trial; requested short submissions on final judgment and whether new claims should be brought in a separate action |
Key Cases Cited
- Goodrich v. E.F. Hutton Group, Inc., 681 A.2d 1039 (Del. 1996) (reciting the American Rule and recognizing contractual fee-shifting exceptions)