ACON Igloo Holdings, LLC v. Dometic Corporation

IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE ACON IGLOO HOLDINGS, LLC, ) ) Plaintiff/Counterclaim ) Defendant, ) ) v. ) C.A. No. 2022-1057-LWW ) DOMETIC CORPORATION, ) ) Defendant/Counterclaim ) Plaintiff. ) MEMORANDUM OPINION Date Submitted: June 12, 2026 Date Decided: September 30, 2026 John M. Seaman, E. Wade Houston & Ben Lucy, ABRAMS & BAYLISS LLP, Wilmington, Delaware; David L. Balser, Lawrence A. Slovensky & Jackson Eskay, KING & SPALDING LLP, Atlanta, Georgia; Counsel for Plaintiff/Counterclaim Defendant ACON Igloo Holdings, LLC Bruce E. Jameson & John G. Day, PRICKETT, JONES & ELLIOTT, P.A., Wilmington, Delaware; Alec H. Schultz, Carly A. Kligler & Sarah G. Perryman, HILGERS PLLC, Miami, Florida; Michael Burns, HILGERS PLLC, Washington, D.C.; Counsel for Defendant/Counterclaim Plaintiff Dometic Corporation WILL, Vice Chancellor  This post-trial decision resolves an earnout dispute. It arises from Dometic Corporation’s October 2021 acquisition of cooler manufacturer Igloo Acquisition Holdings Corporation from an affiliate of ACON Investments LLC—a middle- market private equity firm. The purchase price included a contingent payment that ACON and Igloo leadership, including Igloo CEO David Allen, would receive if Igloo generated at least $75.25 million in EBITDA by year-end 2022. The parties’ stock purchase agreement required Dometic to ensure Igloo would be operated in the ordinary course, consistent with its past practices under ACON, and under Allen’s leadership. It also prohibited Dometic from taking action with the intent to avoid or reduce the earnout payment. As 2022 progressed, it became clear that Igloo was falling short of the target. With the historically slow fourth quarter underway, Allen—in consultation with ACON and its lawyers—presented Dometic with a binary choice between strategies he titled “Deliver Earnout” and “Optimize Long Term Value.” When Dometic reminded Allen that any short-term measures to achieve the earnout had to remain consistent with Igloo’s past practices, ACON and Allen shut down typical discounts in a tactical effort to force a renegotiation. When that plan failed, they turned their focus to litigation. ACON did not meet its burden of proving that Dometic breached the ordinary course or no-avoidance covenants in the purchase agreement. Dometic acted 1 consistently with the contract, and Allen’s “Deliver Earnout” plan was not in the ordinary course. Dometic also failed to prove its counterclaims for tortious interference with confidentiality agreements and trade secret misappropriation. Although the record reflects troubling disclosures of information to ACON by Allen (and, to a lesser degree, by Igloo’s CFO), Dometic proved no resulting injury on its tortious interference claim. Nor did Dometic establish that the presentations on which it based its trade-secret claim contained protectable trade secrets. Ultimately, both sides lose. I. BACKGROUND Unless otherwise noted, the following facts were stipulated to by the parties or proven by a preponderance of the evidence at trial.1 A. ACON Acquires Igloo ACON Investments is a middle-market private equity firm specializing in consumer products, business services, and industrials.2 Its general practice is to 1 See Am. Joint Pre-trial Stipulation (Dkt. 244) (“PTO”). Trial occurred over three days, during which five fact witnesses and two expert witnesses testified live and one fact witness appeared by deposition. See Trial Trs. Vols. I-III (Dkts. 255-57). Trial testimony is cited as “[Name] Tr. __.” The trial record contains 737 joint exhibits and 18 deposition transcripts. Exhibits are cited by the numbers provided on the parties’ joint exhibit list as “JX __,” unless otherwise defined. See Joint Ex. List (Dkt. 254). Deposition transcripts are cited as “[Name] Dep. __.” 2 Brotman Tr. 6-7; PTO ¶ 5. 2 purchase a controlling stake in private companies, grow the enterprise value, and exit at a profit.3 Its investment professionals sit on portfolio company boards and guide strategy, delegating day-to-day management to officers and employees.4 In 2014, ACON Investments acquired Igloo Acquisition Holdings Corporation (“Igloo”), a holding company that owned the Igloo brand and cooler business through subsidiaries.5 ACON Investments formed ACON Igloo Holdings, LLC (“ACON”), a Delaware limited liability company, to effectuate the purchase.6 In 2018, ACON hired David Allen, an industry veteran with experience in the consumer and outdoor products sectors, to serve as Igloo’s Chief Executive Officer.7 Allen embraced a management philosophy of “cut[ting] costs, build[ing] brands, and develop[ing] people.”8 He recruited additional senior leadership, including Robert Peak to serve as Chief Financial Officer.9 3 Brotman Tr. 6-8. 4 Id. at 10. 5 PTO ¶¶ 8, 17. 6 Id. ¶¶ 5, 8. 7 Id. ¶ 9; Brotman Tr. 12. 8 Peak Tr. 352. 9 Brotman Tr. 12. 3  B. Igloo Under ACON Igloo is a “seasonal business” that sets prices based on its “gross margin structure.”10 Its cooler business picks up at the start of spring, “peaks in the summer months, and . . . tails off in the fall.”11 To prepare for peak season, Igloo begins manufacturing coolers in September of the prior year.12 Igloo set its annual budget in the fourth quarter of the prior fiscal year.13 The budget established financial targets, including gross sales and earnings before interest, taxes, depreciation, and amortization (“EBITDA”).14 ACON was ultimately responsible for approving the final budget.15 Throughout the year, ACON monitored Igloo’s financial performance and maintained oversight of its executive team.16 10 Allen Tr. 94-95, 96. 11 Id. at 94. 12 Id. at 95. 13 Id. at 93; Brotman Tr. 13-14. 14 Peak Tr. 352-53, 357. 15 Brotman Tr. 13. 16 Allen Tr. 93-94; Brotman Tr. 13-14 (“I believe . . . we had quarterly board meetings, we had monthly reviews of operations, and then lots of ad hoc interim conversations or emails when things came up.”). 4  ACON empowered Igloo to set prices consistently with its budget and adjust them amid market fluctuations.17 When Igloo fell behind its projections, ACON gave executive leadership wide latitude to implement “levers” to put the company back on track, including price changes, sales campaigns, and cost reductions.18 Igloo did not need ACON’s approval before executing these levers because ACON was not “equipped to opine on” operational issues.19 ACON’s approval was required only for major capital expenditures, such as “upgrading the facilities.”20 ACON’s stated goal was to maximize EBITDA.21 And Igloo aimed to meet or exceed its budgeted EBITDA.22 In 2019, Igloo obtained a year-end EBITDA of roughly $35 million.23 In 2020, its EBITDA was approximately $39.3 million.24 And in 2021, Igloo obtained an EBITDA of roughly $31 million.25 17 Allen Tr. 93-94, 97-99 (describing the effects of the COVID-19 pandemic and a “heavy freeze in and around the Texas area” on resin prices); Peak Tr. 357. 18 Brotman Tr. 16; id. at 29-30, 51-52; Allen Tr. 96-102, 121. 19 Brotman Tr. 8, 16 (“We are not business owners or operators. We invest.”). 20 Allen Tr. 94. 21 Brotman Tr. 23, 84-85. 22 Peak Tr. 352-53 (“When we would set a budget, the goal was to hit the budget or exceed the budget from an EBITDA perspective.”); Allen Tr. 94. 23 Ratner Tr. 706. 24 Kulkarni Tr. 621-22; JX 23. 25 Ratner Tr. 706. 5  C. Dometic Acquires Igloo In 2021, Dometic Corporation identified Igloo as a potential acquisition target.26 Dometic is a U.S. subsidiary of Dometic Group AB, a Swedish public company.27 Its mission is to “implement strict norms and efficient processes to ensure that all operations create long-term value for shareholders and other stakeholders.”28 Dometic Group is led by Juan Vargues, who has served as its Chief Executive Officer since 2018.29 Under Vargues’s leadership, Dometic has completed twelve acquisitions, ten of which included an earnout component.30 Until now, Dometic had never been involved in earnout litigation.31 On September 17, 2021, ACON agreed to sell its ownership interest in Igloo to Dometic pursuant to a Stock Purchase Agreement (the “Purchase Agreement”) for consideration of up to $900 million.32 The purchase price included a $677 million cash payment at closing, the potential for additional payments in post-closing 26 Vargues Dep. 93-94. 27 PTO ¶ 12. 28 JX 121 at 69. 29 Vargues Tr. 488; PTO ¶ 13. 30 Vargues Tr. 488-89. 31 Id. at 490. 32 PTO ¶ 24; Brotman Tr. 17; JX 64 (“Purchase Agreement”). 6 adjustments, and contingent earnout payments of up to $223 million.33 If Igloo achieved the earnout, Allen and Peak stood to personally benefit: Allen a maximum of $15.77 million, and Peak $2.31 million.34 D. The Purchase Agreement The earnout was contingent on Igloo’s achievement of EBITDA targets between December 25, 2021 and December 31, 2022.35 If Igloo’s aggregate EBITDA during the earnout period was less than $75.25 million, no earnout payment was owed.36 If Igloo achieved the $75.25 million threshold, ACON was entitled to a $75.5 million payment.37 The amount owed to ACON increased incrementally for each dollar of EBITDA over this minimum base target, capped at a maximum payment of $223 million if EBITDA exceeded $86.20 million.38 The earnout structure created conflicting incentives. ACON and Igloo management were incentivized to maximize short-term EBITDA to ensure payment of the earnout.39 Dometic sought to maximize long-term stockholder value.40 To 33 Purchase Agreement § 1.8; id. at Ex. A-3; see Brotman Tr. 17; PTO ¶ 25. 34 PTO ¶¶ 27, 29; JX 76; JX 77. 35 Purchase Agreement § 1.8; PTO ¶ 1. 36 Purchase Agreement § 1.8(a)(i). 37 Id. § 1.8(a)(i); id. at Ex. A-6. 38 Purchase Agreement § 1.8(a)(ii); id. at Exs. A-1, A-6. 39 Brotman Tr. 7-8, 32. 40 Id. at 44. 7 manage this risk, the parties agreed to certain restrictions on Dometic’s authority to run Igloo’s business during the earnout period. Dometic’s “discretion with regard to all matters relating to the operation of” Igloo was limited by a covenant that Allen would have “reasonable authority to run the daily operations” of Igloo.41 Igloo would be operated “in the ordinary course of business and consistent with past practices.”42 Dometic agreed to “provide support as [wa]s reasonably necessary” for Allen to operate Igloo “consistent with the manner” it had been run before closing.43 Dometic also agreed not to take any action “with the intent of reducing the EBITDA” of Igloo “or otherwise avoiding or reducing” the earnout payment.44 Alongside the Purchase Agreement, Allen and Peak entered into Confidentiality and Employment Agreements with Dometic (the “Confidentiality Agreements”).45 The Confidentiality Agreements barred Allen and Peak from disclosing “Confidential Information” about Igloo’s businesses.46 41 Purchase Agreement § 1.8(c)(i). 42 Id. 43 Id. § 1.8(c)(ii). 44 Id. § 1.8(c)(vi). 45 JX 78; JX 79. 46 JX 78 § 6(b); JX 79 § 6(b). 8  E. Igloo’s Performance in Late 2021 to Mid-2022 In the fourth quarter of 2021, Igloo presented its 2022 budget to Dometic. Due to “dramatic swings in [Igloo’s] input costs and the continuing impact of COVID,” Igloo presented three budget scenarios.47 The “Most Likely” scenario forecast gross sales of $585.6 million and EBITDA of $75 million.48 Igloo relied upon this scenario to set its budget target at $75 million in EBITDA.49 It noted a “medium probability” that lower sales volume and higher resin and freight costs might cause it to miss this mark.50 In the first quarter of 2022, external market forces disrupted Igloo’s projections. Russia invaded Ukraine, which increased oil prices.51 As a result, the index for composite resin—a key material used to make Igloo coolers—spiked from $0.90 to $1.05.52 These resin prices exceeded Igloo’s initial projections.53 Freight costs also skyrocketed. Igloo’s budget assumed freight costs of $11,000 per container, but the index rose to $15,800 by March 2022.54 In response, 47 PTO ¶ 30; JX 81. 48 JX 81. 49 PTO ¶ 30. 50 Peak Tr. 426-48. 51 Allen Tr. 113. 52 Id. 53 JX 81 at 5. 54 JX 2001 at 1. 9 Igloo management elected to raise prices mid-March, but the increases would not take effect for 60 to 90 days.55 Consequently, Igloo fell behind its targets for the first half of the year.56 In June 2022, Igloo reported that its year-to-date gross sales were $19 million lower than budget and EBITDA was $13 million lower than budget.57 F. Igloo’s Performance in the Third Quarter of 2022 On July 13, 2022, Igloo’s senior leadership team met to discuss the earnout.58 Management circulated an “Earnout Update” presentation revealing that net sales were 6% below budget and EBITDA was 28% below target.59 The presentation directed employees to “[s]ubmit three actions that [their] team [would] take to drive $75.25M+ EBITDA” to Allen and Peak by July 15.60 Allen and Peak consolidated the resulting proposals in a document called “Path to $75M.”61 According to Allen, Igloo’s “biggest value driver” would require resolving “open pricing discrepancies.”62 55 See JX 116; JX 140; Allen Tr. 113; Militello Tr. 323. 56 Peak Tr. 372. 57 JX 170 at 9. 58 JX 169 at 1-2. 59 Id. at 3. 60 Id. at 7. 61 JX 180; JX 181; JX 182. 62 JX 174. 10  On August 8, both Allen and Peak submitted official notice of their intent to leave Igloo.63 The notice was given 150 days in advance, under the terms of their employment agreements with Dometic.64 Meanwhile, the ACON team was exploring ways to hit the $75.25 million EBITDA target as it grew increasingly unlikely. For example, it contemplated purchasing—then giving away—$20 million worth of Igloo coolers in August 2022.65 It discussed whether Igloo could execute a sale-leaseback transaction relating to its facilities in Katy, Texas.66 By October 2022, third-quarter financials confirmed that Igloo missed its gross sales and EBITDA targets.67 Peak informed Allen that hitting the earnout required a $22 million fourth-quarter EBITDA—far exceeding the initially budgeted $8.5 million.68 Despite this deficit, Igloo management continued to forecast fourth- quarter EBITDA between $20.1 and $21.7 million to the Dometic board.69 63 JX 189; JX 190. 64 JX 189; JX 190. 65 JX 191; Brotman Tr. 27-28. 66 JX 183; JX 187; JX 209. 67 JX 268 at 1, 10. 68 Id. at 1. 69 JX 2002 (September 20 presentation) 16; JX 288 (October 11 presentation) 20; Allen Tr. 231-32 (explaining that he did not tell Dometic’s board that Igloo was tens of millions behind the sales and EBITDA targets in its preexisting budget). 11  Internally, however, Allen acknowledged on October 11 that Igloo “still ha[d] about $25M of sales to identify in Q4.”70 On October 17, management reported its third-quarter miss and forecasted a year-end EBITDA of $64.1 million, absent $30 to $40 million of additional fourth-quarter sales.71 G. Plan D Facing a significant deficit after the prior three quarters, Allen formed a new strategy to boost EBITDA in the fourth quarter. Doing so was no small task. The fourth quarter was “historically [Igloo’s] lowest EBITDA and sales quarter,” given the seasonal nature of its business.72 On October 19, Allen sent a text message to Suma Kulkarni, a managing partner of ACON Investments.73 He wrote: “Alright, I have a new idea (Plan D). Let’s touch base in the morning if you’re free.”74 ACON’s founding partner, Ken Brotman, described Plan D as “a continuing attempt” to “reach a commercial settlement” with Dometic regarding the earnout.75 Allen executed on the plan the following day. 70 JX 289 at 1; see also JX 156. 71 JX 294 at 15; Allen Tr. 216-17. 72 JX 2012; Peak Tr. 455 (quoting JX 2012). 73 JX 299 at 2 (text message from Allen to “Mommy bb” (Kulkarni)); see PTO ¶ 7. 74 JX 299 at 2. 75 Brotman Tr. 48; see PTO ¶ 6. 12  On October 20, Vargues met with Allen and other members of Igloo management at Igloo’s headquarters in Texas.76 He was exploring a transition plan given Allen’s and Peak’s upcoming departures. During a closed-door meeting, Allen told Vargues that he intended to pursue a plan to sell off excess and obsolete inventory and “pull forward a price decrease” during the fourth quarter to reach the earnout target.77 If Vargues was unsupportive of the plan, Allen said that Vargues would need to renegotiate the earnout with ACON.78 Allen’s plan amounted to two options: boost sales for the fourth quarter to deliver the earnout, or concentrate on long-term growth but not hit the earnout target.79 Vargues asked Allen to prepare materials summarizing the two scenarios.80 Later that day, Peak sent Vargues a slide deck titled “2022-2023 Scenarios,” which modeled the financial effects of the two options Allen had raised.81 The scenarios were titled “Deliver Earnout” and “Optimize Long Term Value.”82 Under the “Deliver Earnout” scenario, Igloo would achieve an EBITDA of $77.9 million 76 PTO ¶ 34. 77 Allen Tr. 138-39; see Vargues Tr. 503. 78 Allen Tr. 138-39 (“And told him if he didn’t want to do either of those actions, then that was between he and ACON if he wanted to go and negotiate that.”); Vargues Tr. 502-06. 79 Vargues Tr. 503-04. 80 Allen Tr. 139. 81 JX 315; Allen Tr. 139. 82 JX 315. 13 in 2022 but comparatively lower EBITDA in the first and second quarters of 2023.83 Under the “Optimize Long Term Value” scenario, Igloo would achieve an EBITDA of $65.1 million in 2022 but maintain “sequential quarterly [EBITDA] growth” through the end of 2023.84 Allen then forwarded the scenarios he “shared with Juan” to Kulkarni and Brotman.85 H. Vargues Emails Allen On October 22, Vargues emailed Allen regarding the “2022-2023 Scenarios.”86 He wrote: We consider the development of the Igloo business and the value creation for all the stakeholders long term as very important. The company business shall be conducted in the ordinary course of business consistent with the past practices and we do not see reasons to take any short term measures deviating from that.87 83 Id. at 3. Mike Avery, Igloo’s VP of Finance, created the deck. He modeled a scenario in which Igloo increased fourth quarter sales volume by decreasing price. Avery Dep. 202-03. 84 JX 315 at 2. 85 JX 303. 86 JX 316. 87 Id. 14 Allen responded later that day, writing: “[U]nderstood. We will continue to operate the business in the ordinary course.”88 Allen also forwarded the exchange to Brotman, Kulkarni, and ACON’s counsel at King & Spalding LLP.89 Vargues lacked the information needed to assess the two scenarios and grew concerned that Allen and ACON were driving to renegotiate the earnout. 90 He contacted Josh Militello—Igloo’s then-Senior Vice President of Sales—to discuss the scenarios.91 Vargues asked Militello whether it made sense for Igloo’s long-term positioning to decrease prices to deliver the earnout.92 Militello told Vargues that, if it were up to Militello, Igloo would not take the price decreases because it would be an anomaly that would impair long-term value creation.93 In prior years, Igloo had not offered the sort of incentives and pricing reductions to drive revenue and hit its budget during the fourth quarter that Allen was contemplating.94 88 JX 320. 89 JX 321. 90 Vargues Tr. 505-06. 91 Id. at 506-07; Militello Tr. 332. 92 Militello Tr. 332. 93 Id. at 332-33 (“I told him if I was in his seat, then his best bet for the long-term value of Dometic was to not take a price decrease.”); Vargues Tr. 507. 94 Militello Tr. 327-28. 15  The next day, Vargues emailed Allen and Peak to express his preference for maintaining the company’s past practices.95 He expressed that he interpreted the 2022-2023 Scenarios deck as an intention to “implement extraordinary measures . . . in contradiction with the principles of the operating model for Igloo agreed [to] in the [Purchase Agreement].”96 Vargues “reiterate[d]” what Peak and Allen “already kn[e]w and what should be [their] guiding principle for running the company during the earn out period, namely that [they] and the Igloo management team shall conduct the company business in the ordinary course of business consistent with past practices.”97 He closed by stating: “Any short term measures contradicting this principle must be approved by [Dometic], and we want by this email [to] make it very clear: we do not approve any short term[] actions, such as customer campaigns with discounted prices.”98 Once again, Allen forwarded Vargues’s email to ACON.99 Kulkarni responded that it was “[n]ot good,” and that they needed to “come up with a plan that gets to negotiate and get to a win win.”100 Allen suggested that they be “more 95 JX 326; Vargues Tr. 509-510; Allen Tr. 150-51. 96 JX 326. 97 Id. (emphasis removed). 98 Id. (emphasis added). 99 Id.; JX 325 (“Just sent you the latest response from Dometic.”). 100 JX 325. 16 aggressive” in responding that Dometic was “trying to limit [their] ability to deliver the earnout.”101 On October 23, Allen asked Brotman and Kulkarni to “get aligned before” speaking with King & Spalding.102 Throughout the day, they had calls and exchanged emails with King & Spalding about how to respond to Vargues.103 Brotman proposed that Allen write: “Past practice has always included the fundamental objective of maximizing revenues and EBITDA for current periods and that is what we continue to do . . . .”104 Brotman knew that Igloo had not, however, previously maximized revenue for an earlier quarter to the detriment of a later quarter.105 That afternoon, Allen wrote to Vargues that he would “continue to operate the business in the ordinary course of business.”106 He disavowed any “plan to implement ‘extraordinary measures’” and confirmed that his plans were “completely consistent with past practices.”107 Allen also expressed that he had “the authority to 101 Id. 102 JX 333 at 2. 103 JXs 330-44. 104 JX 330. 105 Brotman Tr. 85-86; Brotman Dep. 180. Brotman was impeached on this issue at trial. 106 JX 346. 107 Id. 17 operate the business in the ordinary course” without being “micromanage[d]” by Dometic.108 I. The Airport Phone Call Allen was scheduled to fly to Bentonville, Arkansas on October 24 to present a sales pitch to Walmart—Igloo’s largest customer.109 To prepare for the pitch, Igloo management had drafted a proposal offering Walmart a 10% cost concession in exchange for accepting a minimum of $14 million in incremental shipments.110 Igloo had not previously offered these types of incentives in the fourth quarter.111 While at the airport, Allen joined a Microsoft Teams call with Peak, Vargues, and Stefan Fristedt (Dometic’s Chief Financial Officer).112 Fristedt recorded the call.113 Allen explained that he was “jumping on the plane to go meet with [Igloo’s] largest customer” to “get rid of what is over 110 percent increase in inventory.”114 Fristedt asked Allen about the 2022-2023 scenarios deck—specifically, why Allen had presented Dometic with the choice to either allow Igloo to satisfy the 108 Id. 109 Allen Tr. 179; Peak Tr. 484; JX 313. 110 JX 313. 111 Militello Dep. 167; see also id. at 262-64; JX 375. 112 JX 348 (native). 113 JX 2009; Fristedt Tr. 611-12. 114 JX 2009 at 4. 18 earnout or generate long-term value.115 Allen responded that short-term discounting was necessary to monetize inventory because they were “sitting on 110 percent more inventory” and “have to continue to pre-build coolers” for the summer months.116 Vargues was wary of Allen’s shift in plan, and mentioned that two weeks earlier, Allen had told him “minor concessions” only were planned, which were “pretty different” from Allen’s new proposal.117 Allen was unwavering, and said that he did not need Dometic’s “permission” for price concessions.118 Vargues was also suspicious that Allen had even raised a pricing issue with Dometic, since he had never done so before.119 After more back-and-forth, Allen stated that he and Vargues would “agree to disagree.”120 The call ended. Although Vargues never told Allen to stand down or cancel his meeting, Allen abruptly left the airport and cancelled his trip to Bentonville.121 115 Id. at 4. 116 Id. at 6. 117 Id. at 7. 118 Id. at 7-8. 119 Id. at 9-10. 120 Id. at 11. 121 Allen Tr. 180-81. 19  That afternoon, Allen wrote to Vargues to “follow up” on their Teams call.122 He stated that Vargues had “reiterated [his] direction from [his] prior email” that Dometic “d[id] not approve any short term[] actions, such as customer campaigns with discounted prices.”123 “As a result,” Allen said, Igloo would “not offer Walmart or any [other] customers excess inventory at reduced prices or give any price concessions for the balance of the year.”124 He noted that this move would “adversely affect [Igloo’s] revenue, EBITDA and working capital for Q4.”125 Vargues was puzzled by this email, since he had not given any such direction during the Teams call.126 He asked Allen why, in the course of one month, he had “adjusted the outlook for Q4 2022 three times.”127 Vargues pointed out specific figures and observed that, “[w]hen looking back on the quarterly patterns[,] it [wa]s hard to understand that the latest outlook for Q4 2022 [Allen was] suggesting would have anything to do with past practices.”128 He emphasized that Dometic had not, 122 JX 381. 123 Id. 124 Id. 125 Id. 126 Vargues Tr. 515-16; see JX 2009. 127 JX 381. 128 Id. 20 at any point, given the Igloo team instructions adversely affecting Igloo’s financial results but had required Igloo to operate “in the ordinary course.”129 Allen then directed Militello to suspend discount programs for numerous clients.130 J. ACON’s Litigation Preparations With Plan D having failed, ACON turned its focus to litigation. On October 25, Brotman asked Allen to call him before Allen spoke “to lawyers.”131 Brotman asked Allen to move correspondence to his “personal email.”132 Allen forwarded emails to Brotman and Kulkarni about a request Dometic had not yet approved and Igloo’s inventory, prior sales programs, and financial information.133 He did so to “support the earnout conversation discussions [they] were having.”134 The next day, on October 26, Allen and Kulkarni exchanged text messages about a draft notice that Dometic had breached the Purchase Agreement.135 Allen 129 Id. 130 JX 379. 131 JX 357. 132 Id. 133 JX 356; JX 358; JX 359; JX 366; see Allen Tr. 291-94. 134 Allen Tr. 293. 135 See JX 375; Allen Tr. 296. 21 provided input on King & Spalding’s draft.136 Allen commented: “[W]e can’t say that we ran a similar program last year in Q4 because we didn’t have future price increases to leverage.”137 He also suggested that he could “shut down all promotions/discounts” at Igloo, acknowledging that it would “hurt [Igloo] even further” but “[t]hat may be the point.”138 King & Spalding transmitted a Notice of Breach to Dometic’s counsel on October 27, stating that Dometic was in violation of the Purchase Agreement.139 The letter stated that Dometic had “overruled Mr. Allen’s decisions on issues that fall within the purview of the management team,” causing “material harm to [Igloo’s] business” and “a significant detrimental effect on [Igloo’s] 2022 EBITDA.”140 On October 31, counsel for Dometic sent a response letter denying the accusations.141 On November 6, Allen participated in a call with ACON, King & Spalding, and the Aegis Law Group (which ACON had retained to represent Allen).142 The purpose of the call was to gather more factual information in preparation for filing 136 JX 375 (Allen: “Overall, a massive improvement from the original draft.”). 137 Id.; Allen Tr. 297. 138 JX 375. 139 JX 2004. 140 Id. 141 JX 384; see also JX 408. 142 JX 392. 22 the present action.143 In the coming weeks, Allen provided additional information to assist in drafting the complaint.144 The specter of litigation was designed to encourage Dometic to recut the deal. As ACON’s counsel noted: “[Allen] will drop the bomb, we then send the letter” attempting to renegotiate the earnout, “and the field is set for a discussion.”145 Dometic declined to renegotiate the earnout. K. Disclosures to ACON and BBI During the fourth quarter, Peak and Allen transmitted Igloo proprietary documents to ACON. On November 18, Peak sent a slide deck titled “SKU and Customer EBITDA” to Kulkarni.146 The slide deck contained charts and graphs pertaining to Igloo’s sales, customer- and product-specific EBITDA, and SKU proliferation.147 The next morning, Kulkarni forwarded Peak’s email and the presentation to Beauty By 143 Id.; JX 395. 144 See JX 398; JX 400; JX 401; JX 403; JX 417; JX 418. 145 JX 404 at 5; Kulkarni Tr. 671. 146 JX 1001. 147 Id.; Peak Tr. 354. 23 Imagination (“BBI”), an ACON portfolio company.148 She then forwarded a second, similar Igloo presentation to BBI.149 On November 28, Kulkarni asked Allen for a copy of Igloo’s “current org chart.”150 Allen sent back several charts documenting Igloo’s organizational structure.151 They were marked “CONFIDENTIAL,” indicating that “[t]he[] documents contain information which is confidential and proprietary to Igloo Products Corp.”152 On November 30, Peak forwarded a Dometic presentation to another ACON employee.153 “Exactly what we need at BBI,” the ACON employee responded.154 One week later, Peak emailed a BBI employee a presentation called “Igloo Strategic Plan,” which was labeled “Confidential and Proprietary.”155 Both emails were sent from Peak’s personal email address.156 148 Peak Tr. 354; JX 1001 at 1. 149 JX 1002. 150 JX 433. 151 Id. 152 JX 433. Allen sent additional spreadsheets with detailed financial information on January 19, 2023. JX 480. He also transmitted proprietary business decisions, such as why Igloo had not executed certain “cost savings rebates,” to Kulkarni. JX 487; JX 488. 153 JX 438; JX 439. 154 JX 438; JX 439. 155 JX 447. 156 JX 438; JX 439; JX 447. 24  L. This Litigation ACON filed this lawsuit on November 18, 2022, advancing claims for breach of the Purchase Agreement and of the implied covenant of good faith and fair dealing against Dometic.157 Dometic brought several counterclaims, some of which I dismissed under Rule 12(b)(6).158 The remaining counterclaims are for tortious interference with contract and misappropriation of trade secrets under the District of Columbia Uniform Trade Secrets Act. A three-day trial took place on March 11-13, 2026.159 Post-trial briefing was complete as of June 8, 2026.160 A post-trial argument was held on June 12, 2026, after which the matter was submitted for decision.161 II. ANALYSIS ACON claims that Dometic breached its contractual obligations and the implied covenant of good faith and fair dealing by interfering with Igloo’s ability to operate in the ordinary course during the earnout period. It seeks money damages 157 Dkt. 1. ACON filed an amended and supplemented complaint on February 12, 2025. Dkt. 211. The claims remained fundamentally the same. Id. 158 Dkts. 74, 144, 147. 159 Dkt. 251. 160 See Pl.’s Opening Post-trial Br. (Dkt. 259); Def.’s Post-trial Answering Br. (Dkt. 262); Pl.’s Post-trial Reply Br. (Dkt. 263); Def.’s Post-trial Reply Br. (Dkt. 264). 161 Dkt. 267. 25 plus pre- and post-judgment interest.162 Dometic claims that ACON tortiously interfered with Allen’s and Peak’s Confidentiality Agreements in seeking confidential information, and that ACON misappropriated Igloo’s trade secrets by obtaining certain presentations containing purportedly proprietary information. It likewise seeks money damages and pre- and post-judgment interest.163 The proponents bear the burden of proving their claims by a preponderance of the evidence. “Proof by a preponderance of the evidence means proof that something is more likely than not.”164 Under this standard, “certain evidence, when compared to the evidence opposed to it, has the more convincing force and makes [the court] believe that something is more likely true than not.”165 Neither party met its burden of proof at trial on any claims. A. Whether Dometic Breached the Purchase Agreement ACON claims that Dometic breached earnout-related covenants in Section 1.8(c) of the Purchase Agreement.166 To prevail on its breach of contract claim, ACON must prove the existence of a contract, a breach of an obligation imposed by 162 PTO § IV.A ¶ 54. 163 Id. § IV.B ¶ 55. 164 Agilent Techs., Inc. v. Kirkland, 2010 WL 610725, at *13 (Del. Ch. Feb. 18, 2010) (quoting Del. Express Shuttle, Inc. v. Older, 2002 WL 31458243, at *17 (Del. Ch. Oct. 23, 2002)). 165 Id. 166 Pl.’s Opening Post-trial Br. 41-47. 26 that contract, and resulting damages.167 The parties agree that the Purchase Agreement is valid and binding.168 My analysis therefore hinges on the second element: whether Dometic breached it. This inquiry is guided by settled principles of contract interpretation.169 “Delaware law adheres to the objective theory of contracts,” meaning that “a contract’s construction should be that which would be understood by an objective, reasonable third party.”170 Where a contract is unambiguous, the court gives effect to the “plain meaning of the contract’s terms and provisions.”171 It must assess the contract “as a whole and . . . give each provision and term effect, so as not to render any part of the contract mere surplusage.”172 ACON claims that Dometic breached two sets of earnout-related covenants in the Purchase Agreement. The first set defined Allen’s authority to operate Igloo in the ordinary course of business and required Dometic to provide him support to do 167 See VLIW Tech., LLC v. Hewlett-Packard Co., 840 A.2d 606, 612 (Del. 2003). 168 PTO ¶ 24. 169 See Purchase Agreement § 10.9 (selecting Delaware law to govern “matters of validity, construction, effect, performance and remedies”). 170 Salamone v. Gorman, 106 A.3d 354, 367-68 (Del. 2014) (quoting Osborn ex rel. Osborn v. Kemp, 991 A.2d 1153, 1159 (Del. 2010)). 171 Osborn ex rel. Osborn v. Kemp, 991 A.2d 1153, 1159-60 (Del. 2010); see also Rhone- Poulenc Basic Chems. Co. v. Am. Motorists Ins., 616 A.2d 1192, 1195 (Del. 1992) (“Clear and unambiguous language . . . should be given its ordinary and usual meaning.”). 172 Osborn, 991 A.2d at 1159 (quoting Kuhn Constr., Inc. v. Diamond State Port Corp., 990 A.2d 393, 396-97 (Del. 2010)). 27 so (the “Ordinary Course Covenant”).173 The second prohibited Dometic from acting with the intent to avoid or reduce the earnout payment (the “No-Avoidance Covenant”).174 In ACON’s view, these covenants were intended to “freeze time,” preserving Allen’s reasonable authority and Igloo’s ability to operate in the ordinary course while prohibiting Dometic from working to deprive it of the earnout.175 ACON asserts that Dometic breached these covenants by “overruling” Igloo’s Q4 2022 plan and by “direct[ing] Allen not to implement the short-term actions Igloo management had identified to achieve Igloo’s financial targets.”176 ACON failed to prove a breach of either covenant. 1. The Ordinary Course Covenant Section 1.8(c) of the Purchase Agreement provides, in relevant part: During the Earn-Out Period, [Dometic] shall have discretion with regard to all matters relating to the operation of [Igloo], provided that: (i) [Dometic] shall procure that David Allen will have reasonable authority to run the daily operations of [Igloo] and shall conduct the business of [Igloo] in the ordinary course of business and consistent with past practices of [ACON] (subject to [Dometic’s] code of conduct and other policies). David Allen 173 Purchase Agreement § 1.8(c)(i)-(ii). 174 Id. § 1.8(c)(vi). ACON raised other allegedly breached covenants before trial but opted not to press them in post-trial briefing. Those arguments are waived. See Emerald P’rs v. Berlin, 726 A.2d 1215, 1224 (Del. 1999) (“Issues not briefed are deemed waived.”). 175 Pl.’s Opening Post-trial Br. 41. 176 Id. 28  will have reasonable authority to