Chancery Addresses Issue of First Impression Regarding Anti-SLAPP Statute and Contract-Related Claims

Key Takeaways

• Letter lacked unilateral demand to alter contract terms
• Repudiation requires unequivocal, unconditional refusal to perform
• Delaware permits retracting repudiation before performance deadline
• Anti‑SLAPP nexus must link protected activity to cause of action
• Court denied fee shift, deeming motion filed in good faith

Pulse Analysis

Delaware’s recent adoption of the Uniform Public Expression Protection Act (UPEPA) marks a significant shift in how courts handle strategic lawsuits against public participation. By creating an expedited special motion to dismiss, the statute aims to protect constitutionally protected speech while still allowing legitimate claims to proceed. The Tesoro case illustrates the practical application of UPEPA, showing that courts will scrutinize the nexus between the plaintiff’s protected activity and the underlying cause of action, preventing parties from weaponizing the law against routine commercial disputes.

In contract law, the Chancery’s repudiation analysis reinforces a high threshold for terminating agreements. A termination notice must contain a clear, unconditional intent not to perform, not merely a threat to enforce contractual rights. This nuanced distinction matters for high‑stakes collaborations, especially in pharma where multi‑year development agreements are common. Companies must ensure any termination communication explicitly states the intent to abandon obligations if they wish to invoke repudiation defenses, or risk the claim being dismissed as non‑repudiatory.

For litigants, the decision provides guidance on fee‑shifting under UPEPA. While the statute allows recovery of attorney fees for frivolous motions, the court emphasized good‑faith filing as a safeguard against punitive awards. Practitioners should therefore document the legitimate basis for Anti‑SLAPP motions and be prepared to demonstrate the protected nature of the activity. As Delaware courts continue to interpret UPEPA, businesses can expect clearer boundaries that balance free expression with the need to resolve genuine commercial disputes efficiently.