Toptal, LLC v. Bloomberg L.P.

IN THE SUPERIOR COURT OF THE STATE OF DELAWARE

TOPTAL, LLC )
) C.A. No.: N25C-01-266 FJJ
)
Plaintiff, )
)
v. ) JURY TRIAL DEMANDED
)
BLOOMBERG L.P. )
)
)
Defendant. )

Submitted: July 15, 2025
Decided: July 31, 2025

OPINION AND ORDER
On Defendant’s Motion to Dismiss

GRANTED, in part, and DENIED, in part.

Brian E. Farnan and Michael J. Farnan, Esquires, Farnan LLP, Wilmington
Delaware, Megan L. Meier, Mark R. Thomson, and Devin K. Bolger, Esquires (Pro
Hac Vice) Meier Watkins Phillips Pusch LLP, Washington, D.C., Alan S. Lewis and
Madelyn K. White, Esquires (Pro Hac Vice) Carter Ledy & Milburn LLP, New York,
New York, Attorneys for Plaintiff.

James M. Yoch, Jr. and Skyler A. C. Speed, Esquires, Young Conaway Stargatt &
Taylor, LLP, Wilmington, Delaware, Thomas G. Henoff, Nicholas G. Gamse, and
Alexandra M. Gutierrez, Esquires (Pro Hac Vice), Williams & Connolly LLP,
Washington, D.C., Attorneys for Defendant.

Jones, J.
INTRODUCTION

Plaintiff Toptal, LLC (“Toptal”) brings the instant defamation action from an

article and column (collectively, the “Publications”) published by Defendant

Bloomberg L.P. (“Bloomberg). The Publications cover a prior litigation in Nevada

State Court initiated by Toptal against a former financial supporter of the company

whom the Nevada Court found liable for multiple claims. Toptal asserts inter alia

Bloomberg’s publications do not accurately or fairly report on the Nevada litigation

and make numerous false and defamatory statements impacting Toptal’s integrity as

a respected company.

BACKGROUND

A. The Parties

Toptal is a Delaware limited liability company which connects “businesses with

freelancers such as software engineers, designers, and business consultants.”1

Toptal’s sole member, Taso Du Val, founded the company in 2010.2 The company

does not have a physical office space, but it uses its Delaware address for purposes

such as issuing employee W-2s and on contracts with clients and vendors.3

Bloomberg is a Delaware limited partnership and has its principal place of

business in New York.4 Bloomberg News is a news agency headquartered in New

1
Docket Item (“D.I.”) 1 ¶¶3, 17.
2
Id.
3
Id.; D.I. 17 p.9.
4
D.I. 1 ¶19.

2
York and is a division of Bloomberg.5 Bloomberg News “disseminates articles

around the world through its website,” and other publication means.6

B. The Nevada Litigation7

The Publications write on a legal dispute between Toptal and one of its early

financial supporters, Denis Grosz (“Grosz”). 8 In 2012, Grosz gave Toptal $1

million under a Note Purchase Agreement and a Convertible Promissory Note

(collectively, “Convertible Note Agreements”) which allowed Grosz to convert his

debt into equity under certain conditions.9 Grosz had an electable option to forego

principal and interest and instead receive equity on his note.10 If the conditions were

not met when the note’s maturity date approached, Grosz was only permitted to

receive principal and interest, and his note could not convert into equity.11 Under an

Advisor Agreement, Grosz acted as an advisor to Toptal and agreed to not compete

with the company and to keep all company information confidential.12 The

conditions triggering Grosz’s note to convert into equity were never met, thus, under

the agreement, Grosz was entitled to receive only principal plus interest.13

5
Id.
6
Id.
7
See Toptal, LLC v. Grosz, CV20-00555 (Nev. 2d Dist.); D.I. 1 Exhibits (Exs.) 1-3.
8
D.I. 1 ¶3.
9
D.I. 17 p.2; D.I. 1 ¶36.
10
D.I. 1 ¶37.
11
Id. ¶40.
12
Id. ¶41.
13
D.I. 17 p.2-3.

3
Grosz and Toptal’s relationship became strained when, as Toptal alleges, Grosz

“embarked on a malicious plot” to “weaken” Toptal.14 Toptal alleges Grosz’s plan

included “a negative media campaign against Toptal” as well as a ploy “to steal

Toptal’s future business and financial prospects for himself” by forming a competing

company, Mechanism Ventures (“Mechanism”).15

As a result, in March 2020, Toptal initiated the Nevada litigation raising tort and

contractual claims against Grosz and Mechanism.16 Grosz brought a counterclaim

stating Toptal breached the Convertible Note Agreements by failing to give Grosz

equity.17 The Court dismissed the counterclaim on summary judgment.18

At trial, a jury: (1) rejected Grosz’s other counterclaims, including Toptal’s

breach of implied covenant of good faith and fair dealing; (2) found Grosz breached

the Advisor Agreement and the implied covenant of good faith and fair dealing; (3)

found Mechanism liable for intentional interference with contractual relationships;

and (4) awarded Toptal over $1.3 million in compensatory damages and $15 million

in punitive damages, stating that Mechanism acted with “malice, oppression, or

fraud.”19 The trial judge affirmed the verdict but reduced the punitive damages

14
Id. p.3.
15
D.I. 1 ¶¶ 46, 47.
16
D.I. 13 p.6.
17
D.I. 17 p.3.
18
Id.
19
D.I. 13 p.4.

4
award to $1.6 million.20 Both Grosz and Mechanism appealed the Court’s

judgements against them. The appeals are currently pending.21

C. The Publications

After the Nevada Court entered its judgment, Bloomberg published reporter

Sarah McBride’s Article entitled Battle Over Startup Leaves Early Investor With No

Equity, $2.6 Million Legal Bill (the “Article”) and columnist Matt Levine’s Column

titled The FTC Comes for Noncompetes (the “Column”) which includes Levine’s

commentary and an excerpt from the Article.22 The Article reports on Toptal’s

practice of using convertible notes to allow lenders to potentially convert their note

into equity, this practice playing out between Toptal and Grosz, and the Nevada

litigation between Toptal and Grosz and his company, Mechanism.23

Toptal contacted Bloomberg after publication, seeking revisions of statements

Toptal claimed were false. The alleged false reports included:

(1) Grosz’s “investment” – as opposed to his now proven misconduct –
“landed him on the receiving end of a lawsuit;” (2) “Grosz didn’t get
his stake” in Toptal; (3) Toptal “denied early investors a return by
refusing to switch their decade-old convertible debt commitments into
equity, tying up their holdings even as the company has flourished . . .
making their outlay worth little more than the day they invested;” and
(4) “Grosz could still see an equity conversion,” even though the court
had held the opposite.

20
Id.
21
D.I. 1 ¶76.
22
D.I. 13 p.5; D.I. 17 p.9.
23
See D.I. 1 Ex. 4, the Article.

5
In response, Bloomberg changed the title of the Article to A $1 Million Bet on a Tech

Startup Spawns Investor-Founder Fight and made several revisions concerning

Toptal’s equity and Grosz’s post-litigation chances of an equity conversion (“the

Revision”).24

Toptal alleges the Publications hurt Toptal’s reputation and prevented

prospective employees and business partners from working with Toptal.25 Toptal

points to two specific instances. The first situation involves an email sent from “a

leading candidate for a key senior role at Toptal” to Toptal’s head of recruiting. The

email included the candidate’s application withdrawal and a link to the Publications

indicating the Publications were the reason for pulling themselves out of

consideration for the position.26 The second circumstance involved a potential

business partner referencing the Revised Article as the basis for not working with

Toptal.27 Toptal further alleges that “others in the business community” have told

Du Val that the Article “has been mentioned as a source of grave concern that reflects

negatively on Toptal and dissuades them from wanting to enter into business deals

with Toptal.”28

24
See D.I. 13 Ex. 7.
25
D.I. 17 p.6-7.
26
Id. p.6 (citing D.I. 1 ¶109).
27
D.I. 17 p.6 (citing D.I. 1 ¶129).
28
D.I. 1 ¶131.

6
STANDARD OF REVIEW

Rule 12(b)(6) allows the Court to dismiss for failure to state a claim upon which

relief can be granted.29 While ruling on a motion to dismiss, the Court:

(1) accept[s] all well pleaded factual allegations as true, (2) accept[s]
even vague allegations as ‘well pleaded’ if they give the opposing party
notice of the claim, (3) draw all reasonable inferences in favor of the
non-moving party, and (4) do not affirm a dismissal unless the plaintiff
would not be entitled to recover under any reasonable conceivable set
of circumstances.30

Delaware is a notice pleading jurisdiction.31 Therefore, for a complaint to pass

the motion to dismiss stage it needs to provide only “general notice of the claim

asserted.”32 “An allegation, ‘though vague or lacking in detail’ can still be well-

pleaded so long as it puts the opposing party on notice of the claim brought against

it.”33

ANALYSIS

A. Choice of Law

The parties dispute the law applicable to this matter. Defendant claims New York

law applies. Plaintiff counters that Delaware law is applicable.

1. An Actual Conflict Exists Between New York and Delaware Defamation Laws.

29
Super. Ct. Civ. R. 12(b)(6).
30
Cent. Mortg. Co. v. Morgan Stanley Mortg. Cap. Holdings, 27 A.3d 531, 535 (Del. 2011).
31
Doe v. Cahill, 884 A.2d 451, 458 (Del. 2005).
32
Id. (quoting Ramunno v. Cawley, 705 A.2d 1029, 1034 (Del. 1998)).
33
Cahill, 884 A.2d at 458 (quoting VLIW Tech., LLC v. Hewlett-Packard Co., 840 A.2d 606, 611 (Del. 2003)).

7
The parties dispute the law applicable to this matter. Bloomberg claims New

York law applies. Toptal counters that Delaware law is applicable. 34

The preliminary query when conducting a choice of law analysis under Delaware

law is a comparison of Delaware law and “the laws of the competing jurisdiction to

determine whether the laws actually conflict on a relevant point.”35 A genuine

conflict does not exist if “application of the competing laws would yield the same

result.”36 In that instance, the Court does not need to conduct a choice of law

analysis.37

The Court finds there are genuine conflicts between New York and Delaware’s

defamation laws. First, New York’s fair-report privilege is codified, and Delaware

only recognizes the privilege in case law.38 Second, New York has codified anti-

SLAPP fee-shifting protections for publishers.39 Third, New York law requires a

showing of special damages when the challenged statements are not defamatory per

se.40 Whereas, under Delaware law, there is no such requirement to plead special

34
See D.I. 13 p.17; D.I. 17 p.7-8.
35
Vichi v. Koninklijke Philips Elecs., N.V., 85 A.3d 725, 773-74 (Del. Ch. 2014).
36
Id. at 774.
37
Id.
38
See N.Y. Civ. Rights Law § 74; see also US Dominion v. Newsmax Media, Inc., 2025 WL 211497, at *4 (Del.
Super. Ct. Jan. 16, 2025) (finding an actual conflict between New York and Colorado’s fair report privilege based on
codification).
39
See N.Y. Civ. Rights Law § 70-a.
40
Pantheon Props, Inc. v. Houston, 2021 WL 4523619, at *3 (S.D.N.Y. Sept. 30, 2021).

8
damages.41 Finally, New York defamation case law, compared to Delaware case

law, is more developed and provides broader protections.42

2. Delaware Has the Most Significant Relationship to the Occurrence and the
Parties; Therefore, the Court Applies Delaware Law.

Since an actual conflict exists, the Court proceeds to the “most significant

relationship test” as defined by the Restatement (Second) of Conflicts.43 Looking to

the Restatement, Section 150 applies the following to multistate defamation cases:

(1) The rights and liabilities that arise from defamatory matter in any
one…aggregate communication are determined by the local law of
the state which, with respect to the particular issue, has the most
significant relationship to the occurrence and the parties under the
principles stated in § 6.

***

(3) When a corporation…claims that it has been defamed by an
aggregate communication, the state of most significant relationship
will usually be the state where the corporation…had its principal
place of business at the time, if the matter complained of was
published in that state.44

An “aggregate communication” is one that is “published simultaneously in two or

more states,” including a “typical Internet publication, where access is generally

available to anyone at any time.”45

41
Cahill, 884 A.2d at 463 (citing Spence v. Funk, 396 A.2d 967, 970-71 (Del. 1978)).
42
See e.g., Delaware case law has not uniformly adopted a defamation by implication standard, whereas New York
has a stringent-well-established standard, Rappaport v. VV Publ’g Corp., 618 N.Y.S.2d 746, 748 (Sup. 1994); Henry
v. Fox News Network LLC, 629 F.Supp.3d 136, 150 (S.D.N.Y. 2022).
43
Delaware adopts and follows the Restatement (Second) of Conflicts in a choice of law analysis. See Smith v. Del.
State Univ., 47 A.3d 472, 480 (Del. 2012).
44
Restatement (Second) of Conflict of Laws § 150 (1971).
45
Aoki v. Benihana, Inc., 839 F.Supp.2d 759, 765 (D. Del. 2012).

9
Bloomberg argues New York has the most significant relationship to this case

because of both parties’ contacts with New York.46 Bloomberg bases this on

Toptal’s lack of physical headquarters and its sole member being a resident of New

York.47 Bloomberg also points out that in a federal court proceeding, Toptal

represented that “Toptal’s single member, Mr. Du Val, is a resident of New York,

and therefore Toptal itself is located in and was injured in New York.”48 Bloomberg

further supports its argument with the fact that Bloomberg’s news headquarters and

principal place of business are both in New York.49

Toptal contends Delaware has the most significant relationship. To support this

position, Toptal points to its stronger ties to Delaware than New York including (1)

forming in Delaware; (2) using its Delaware address in employee W-2s and contracts

with clients and vendors; (3) emphasizing it is a Delaware business in contracts; and

(4) deriving its largest portion of revenue from clients who are Delaware entities. 50

In the pleadings, Toptal does not claim a principal place of business. Toptal

asserts it is a “fully remote company with no physical offices or headquarters, and

its operations are dispersed all over the world,” and “its personnel typically working

46
D.I. 13 p.17.
47
Id.
48
Id. (citing Ex. 8). Bloomberg cited this quotation from Toptal’s opposition brief in a federal court case based on a
trade secret violation claim. Id. Ex. 8 p.1-3. Toptal made the statement in relation to a personal jurisdiction analysis
under New York law. Id. Ex. 8 p.16-17. The Court does not find this helpful or persuasive to this Delaware choice
of law analysis.
49
D.I. 13 p.17.
50
D.I. 17 p.9-10.

10
from their own workspaces.”51 However, Toptal maintains, based on the above

facts, “to the extent § 150 points toward any state’s law, it’s Delaware’s.”52

Considering Toptal’s contacts with Delaware and its lack of physical office space

and central operations location, the Court will refer to Delaware as Toptal’s principal

place of business for purposes of this analysis.

In its Reply Brief, Bloomberg cites to case law outside of Delaware courts to

argue that in situations such as this one where the company is fully-remote, the

location of “key decision-making executives” is the principal place of business.53

However, Toptal does not allege that Du Val, in his capacity as Toptal’s CEO,

primarily conducts work nor makes decisions for Toptal in New York. The

Complaint only alleges that Du Val is a resident of the State of New York.54

Comment f to Restatement Section 150 states, “the local law of the state of

plaintiff’s principal place of business will [] usually be applied, even though some

or all of the defamer’s acts of communication were done in another state, if all of the

plaintiff’s business is carried on in the former state.”55 This is also the case when

the defamatory acts occur in “a state other than that of plaintiff’s principal place of

business and when the matter complained of is published in the state of the plaintiff’s

51
Id. p.10; D.I. 1 ¶17.
52
D.I. 17 p.10.
53
See D.I. 24 p.6 (citing Paucek v. Shaulis, 2025 WL 1298457, at *18 (D.N.J. May 6, 2025); Benchmark Invs., Inc.
v. PAVmed Inc., 2021 WL 5967918, at *3 (S.D.N.Y. Dec. 16, 2021)).
54
D.I. 1 ¶ 18.
55
Restatement (Second) of Conflict of Laws § 150 cmt. f.

11
principal place of business and in one or more other states to which the plaintiff has

a substantial relationship.”56 Comment b provides the purpose for the Restatement’s

lean towards applying the law of the plaintiff’s principal place of business is to

“further[] the choice of law values of certainty, predictability and uniformity of

result and of ease in the determination and application of the applicable law.”57

Restatement Section 150 maintains the presumption that “the law of the state

where a plaintiff’s principal place of business applies unless there are significantly

sufficient considerations warranting the application of the law of a different state.”58

Other considerations the Court should take into account when determining the state

with the most significant relationship in a multistate defamation include “the state

or states where the defendant did his act or acts of communication, such as

assembling, printing and distributing a magazine or book, [] the state or states of the

defendant’s…organization and principal place of business,” and “the state where the

defamatory communication caused plaintiff the greatest injury to its reputation.”59

This last consideration is most applicable where:

(a) the plaintiff is better known in this state than in the state of its
principal place of business, as might be the case if the plaintiff does
approximately the same amount of business in this state as it does in the
state of its principal business and this state is the state of the plaintiff’s
incorporation or organization, or (b) the matter claimed to be
defamatory related to an activity of the plaintiff that is principally

56
Id.
57
Id. cmt. b.
58
US Dominion, Inc., 2025 WL 211497, at *5.
59
Id.

12
located in this state, or (c) the plaintiff suffered greater special damages
in this state than in the state of its principal place of business, or (d) the
place of principal circulation of the matter claimed to be defamatory
was in this state.60

Each of these factors must be considered “in the light of the choice of law principles

stated in § 6.”61

Analyzing these considerations, the Court does not find them to be sufficiently

significant to warrant applying New York law over the presumed Delaware law.

First, there is not one state of publication or alleged defamatory act that is more

prominent than others. While Bloomberg News is headquartered in New York, the

reporter on the Article was domiciled in California, the litigation the Publications

covered took place in Nevada, and the Publications were posted to Bloomberg.com

which is accessible worldwide. The next consideration, the states of Defendant’s

organization and principal place of business, does not add weight to either side of

the argument because Bloomberg has its principal place of business in New York

and is an entity of Delaware. Finally, the Court does not find any considerations

under state of greatest injury to favor either New York or Delaware. Toptal does not

60
Id.
61
Restatement (Second) of Conflicts of Law § 150 cmt. b. The principles laid out in § 6 include:
(a) the needs of the interstate and international systems,
(b) the relevant policies of the forum,
(c) the relevant policies of other interested states and the relative interests of those states in the
determination of the particular issue,
(d) the protection of justified expectations,
(e) the basic policies underlying the particular field of law,
(f) certainty, predictability and uniformity of result, and
(g) ease in the determination and application of the law to be applied.

13
assert that any alleged harm or injury was felt in a specific state. Bloomberg’s

argument that Toptal has the most significant relationship to New York because Du

Val is a New York resident does not tip the scale in this analysis. Toptal does not

assert that Du Val’s residence is where the majority of Toptal’s contacts are nor

where a significant portion of the company’s work is done.

Delaware case law concerning alleged defamation on internet platforms further

supports the application of Delaware law in this case.62 Moreover, the Delaware

Superior Court has held that both parties being Delaware entities is a consideration

which supports applying Delaware law.63

Therefore, the Court finds based on the presumption set forth in Restatement §

150, cited case law, and Bloomberg’s inability to assert a significantly sufficient

consideration deeming New York law more appropriate, that Delaware law applies

as it is the state with the most significant relationship to the instant action.64

B. Substantially False or Defamatory Statements

62
See e.g. U.S. Dominion, Inc., 2025 WL 211497 (finding plaintiff’s principal place of business to outweigh other
Restatement considerations in choice of law analysis); Armenta v. G/O Media Inc., 2024 WL 4433946, at *5 (Del.
Super. Oct. 7, 2024) (applying the law of plaintiff’s domicile because no other jurisdiction had a significant
relationship to the case); Schmidt v. Washington Newspaper Publ’g Co., LLC, 2019 WL 4785560 at *2 (Del. Super.
Sept. 30, 2019) (“When choosing the applicable law for a claim arising from an Internet publication, the state with
the most significant relationship will usually be the state where the person is domiciled at the time of publication.”).
63
KT4 Partners LLC v. Palantir Techs. Inc., 2021 WL 2823567, at *19 (Del. Super. June 24, 2021) (“Having been
formed in Delaware under Delaware law, the Court finds it reasonable to assume that each party has endeavored to
‘mold[] [its] conduct to conform to the requirements of’ Delaware law.”)
64
The Court bases its decision on the present record. If discovery reveals facts that suggest New York should be
applied, the parties are free to bring the issue back to the Court.

14
To properly allege defamation, a plaintiff must plead: “(1) a false and defamatory

communication concerning the plaintiff, (2) publication of the communication to

third parties, (3) understanding of the defamatory nature of the communication by

the third party, (4) fault on the part of the publisher, and (5) injury to the plaintiff.”65

When the plaintiff is a public figure, the plaintiff must also allege that (6) the

statements are false and (7) the defendant made the statement with “actual malice.”66

Statements are defamatory per se if they “malign one in a trade, business, or

profession” or “impute a crime.”67 Proof of special damages is not required for a

libel plaintiff to recover.68

The Restatement (Second) of Torts, adopted by the Delaware Courts,69 defines

defamation as “[a] communication…tend[ing] to harm the reputation of another as

to lower him in the estimation of the community or to deter third persons from

associating or dealing with him.”70 “Whether a statement is capable of bearing a

particular meaning, and whether that meaning is defamatory, is a question for the

court.”71 However, “only if the Court determines, in the first instance, that the words

65
Images Hair Sols. Med. Ctr. v. Fox News Network, LLC, 2013 WL 6917138, at *3 (Del. Super. Dec. 20,
2013)(quoting Bickling v. Kent Gen. Hosp., Inc., 872 F.Supp.1299, 1307 (D. Del. 1994)).
66
ShotSpotter Inc. v. VICE Media, LLC, 2022 WL 2373418. See D.I. 1 ¶¶ 127, 145 Toptal pleads that Bloomberg
acted with actual malice, or at least reckless disregard, in publishing false and defamatory statements.
67
Feldman v. Marks, 2024 WL 4263931, at *6 (Del. Super. Sept. 23, 2024) (quoting Spence, 396 A.2d at 970)).
68
Cahill, 884 A.2d at 463 (quoting Spence, 396 A.2d at 970).
69
See Q-Tone Broad., Co. v. Musicradio of Maryland, Inc., 1994 WL 555391, at *4 (Del. Super. Aug, 22, 1994);
Spence, 296 A.2d at 969.
70
Restatement (Second) of Torts § 559 (1977).
71
Id. The question of “whether or not a statement is defamatory is a question of law.” Cahill, 884 A.2d at 463.

15
are capable of a defamatory meaning may a jury consider whether such meaning is

ascribed to the words.”72

When considering whether a challenged statement is defamatory, the Court asks

(1) “whether alleged defamatory statements are expressions of fact or protected

expressions of opinion;” and (2) “whether the challenged statements are capable of

a defamatory meaning.”73

Opinion statements are protected by the First Amendment and, therefore, are not

actionable under a defamation claim.74 A “pure opinion” is predicated on stated or

known facts or facts the parties assume exist.75 “Opinions based on nondefamatory

facts do not give rise to an action for libel.”76 Delaware Courts adopted a four-part

test to determine whether a statement is a fact or an opinion.77 The test includes

determining (1) “common usage or meaning of the challenged language;” (2)

“whether the statement can be objectively verified as true or false;” (3) “the full

context of the statement;” and (4) “the broader social context into which the

statement fits.”78

72
Riley v. Moyed, 529 A.2d 248, 253 (Del. 1987) (quoting Slawik v. News-Journal Co., 428 A.2d 15, 17 (Del.
1981)).
73
Cahill, 884 A.2d at 463 (quoting Riley, 529 A.2d at 251).
74
Riley, 529 A.2d at 251.
75
Id.
76
Id. at 250 (citing Restatement (Second) of Torts, §566).
77
Riley, A.2d at 251.
78
Id. (citing Ollman v. Evans, 750 F.2d 970, 979-85 (D.D.C. 1984)).

16
Delaware Courts also adopted New Jersey’s three-part test to conclude whether

a statement is capable of defamatory meaning.79 This test examines the (1) content;

(2) verifiability; and (3) context of an alleged defamatory statement.80

First looking to content of the alleged defamatory statements, “the Court must

look to the ‘fair and natural meaning which will be given it by reasonable persons of

ordinary intelligence.’”81 A party cannot be held liable for defamation if the

statement made is “substantially true.”82 The content of an alleged defamatory

statement is “substantially true” if the statements were “no more damaging to the

plaintiff’s reputation in the mind of the average reader than a truthful statement

would have been.”83 An important consideration when determining whether a

statement is “substantially true” is whether the “gist” or “sting” of the article is true,

meaning “it produces the same effect on the mind of the recipient which the precise

truth would have produced.”84

Second, evaluating verifiability of the alleged defamatory statements ensures

“dispos[al] of defamation claims arising from the expression of mere opinions.”85

79
See Q-Tone Broad., Co., 1994 WL 555391, at *4.
80
Images Hair Sols. Med. Ctr., 2013 WL 6917138, at *3.
81
Id. (quoting Q-Tone Broad., Co., 1994 WL 555391, at *5)).
82
Riley, 529 A.2d at 253 (citing Gannett Co., Inc. v. Re, 496 A.2d 553, 557 (Del. 1985)).
83
Images Hair Sols. Med. Ctr., 2013 WL 6917138, at *3 (quoting Riley, 529 A.2d at 253).
84
Riley, 529 A.2d at 254 (quoting Williams v. WCAU-TV, 555 F.Supp. 198, 202 (E.D. Pa. 1983)).
85
Images Hair Sols. Med. Ctr., 2013 WL 6917138, at *3.

17
“[U]nless a statement explicitly or implicitly rests on false facts that damage a

person’s reputation, the statement will not be actionable as defamation.”86

Finally, the Court must consider the context in which the statements were made.

“The listener’s reasonable interpretation of the statement will be based, in part, on

the context in which the speaker made the statement.” 87 The Court should evaluate

the statement “based on the words and the context in which they were published.”88

The parties’ dispute centers around the first element of defamation and concerns

whether certain statements within the Publications are false and defamatory. The

Court will go through each purported defamatory statement below. The Article and

the Column will be analyzed separately.

The Article

1. Statements Concerning Grosz’s Relationship with Toptal and the Motivator
of the Nevada Litigation

The first statement Toptal alleges is false and defamatory from the Article is

“[w]hen Denis Grosz invested in software startup Toptal LLC in 2012, he hoped the

$1 million bet could one day make him a fortune. Instead, it landed him on the

receiving end of a lawsuit…”89 Toptal asserts this statement provides two false and

86
Q-Tune Broad. Co., 1994 WL 555391, at *5.
87
Id.
88
Cahill, 884 A.2d at 463 (quoting Riley, 529 A.2d at 251).
89
D.I. 13 Ex. 5; see D.I. 1 ¶98.

18
defamatory facts: (1) that Grosz was an investor rather than a lender; and (2) that

Toptal sued Grosz due to his investment in the company.90

Bloomberg argues referring to Grosz as an investor is neither false nor

defamatory. Bloomberg reasons that a convertible noteholder can convert their note

purchase to equity; thus, it is colloquially acceptable to refer to convertible

noteholders as investors.91 Toptal characterizes Grosz’s interest in Toptal as a

lender, and eventually the holder of a matured note, and contrasts this with the

definition of investor, “a person or organization that buys securities or property in

order to receive a profit.”92 Further, Toptal asserts that use of “investor” within the

context of the Article “communicates that Grosz paid money for equity, thereby

blaming Toptal for the fact that Grosz never received equity.”93

The Complaint alleges that the above statement is false because it suggests that

Grosz’s “bet” of $1 million led to the Nevada litigation rather than Grosz’s bad faith

conduct and contractual violations.94 Bloomberg contends it is not “substantially

false” for the Article to suggest that Grosz’s investment resulted in the Nevada

litigation.95 Bloomberg maintains that the Article includes “substantial detail into

90
D.I. 17 p.14.
91
D.I. 13 p. 21-22 [citing Ramco Asset Mgmt., LLC v. USA Rare Earth, LLC, 2024 WL 1716399, at *1 (Del. Ch.
Apr. 22, 2024) (“invested…through the purchase of convertible notes”); Valhalla Partners II, L.P. v. Vistar Media,
Inc., 2024 WL 5039563 (Del. Ch. Dec. 9, 2024) (using investor and noteholder interchangeably)].
92
D.I. 17 p.14 (quoting Investor, Collins Dictionary, collingsdictionary.com/us/dictionary/English/investor). See
also D.I. 17 p.15. n.3 (citing to Gotham Partners, L.P. v. Hallwood Realty Partners, L.P., which distinguishes an
equity investor from a lender “seeking return on a debt” 855 A.2d 1059, 1077 n.35 (Del. Ch. 2003)).
93
D.I. 17 p.15.
94
D.I. 1 ¶98.
95
D.I. 13 p.22.

19
the parties’ dispute” such that the average reader would understand that the Nevada

litigation was a result of the parties’ declining relationship.96 Further, the Article

recounts the litigation and its result.97

Finally, Toptal responds to Bloomberg’s assertion that the statement is not

defamation per se by arguing the statement “falsely charges Toptal with suing an

early investor” to evade equity conversion on Grosz’s note.98 Toptal suggests this

“maligns Toptal in its business – as demonstrated by the prospective employees and

business partners who have cited Bloomberg’s reporting as a reason for not engaging

with Toptal.”99 To support this argument, Toptal cites to several Delaware cases. In

two of these cases, the Court explicitly finds that statements directly impacting the

defamed party in their professional capacity are defamatory per se.100 Toptal also

cites to Jacques-Scott v. Sears Holding Corp. where, in contrast to the other cases,

the Court granted dismissal for failure to state a claim because the alleged

defamatory statements “merely show[ed] opinions and dislike of plaintiff” by

insulting and name-calling the plaintiff.101

96
Id.
97
D.I. 13 Ex. 5 p.1.
98
D.I. 17 p.17.
99
Id.
100
Feldman, 2024 WL 4263931, at *2, 6 (holding defendant’s statements, which were knowingly false when sent to
publication media, constituted defamation per se because the statements alleged plaintiff “schemed” and “cheated”
in his professional capacity); Meades v. Wilmington Hous. Auth., 2006 WL1174005, at * (Del. Super. Apr. 28, 2006)
(finding statements accusing plaintiff of “mishandling…funds” and “misappropriating...property” in his employment
position established defamation per se.”)
101
Jacques-Scott v. Sears Holding Corp., 2011 WL 1059704, at *8 (D. Del. 2011).

20
Concerning the Article’s use of the terms “investor” and “bet,” the Court must

interpret these words “in their plain and natural meaning and understand them as

would a person of average intelligence and perception.”102 In Ramunno v. Cawley,

the Delaware Supreme Court reversed the Superior Court’s decision to sidestep an

interpretive debate and instead rule on the pleadings that the “gist of [the] description

was accurate.”103 The Ramunno Court acknowledged that its duty to draw

reasonable inferences in favor of the non-moving party in congruence with the rule

of interpretation stated above did not warrant dismissal on the pleadings.104 The

interpretative debate in Ramunno centered around whether stating that “some”

houses were occupied by tenants was a false way to describe only one house being

occupied, or if it was merely an immaterial error of an otherwise true statement.105

The statement at issue must be read in the framework of the whole Article as well

as in the context of the Nevada litigation because a statement that is defamatory

based solely on its content could be found incapable of defamatory meaning in light

of its context.106 A portion of the Article details the Nevada litigation. It mentions

the claims Toptal brought against Grosz and Mechanism, the affirmative defenses

raised by Grosz and Mechanism, the jury’s verdict, and finalized damages owed by

102
Ramunno, 705 A.2d at 1035-36.
103
Id. at 1035.
104
Id. at 1035-26.
105
Id.
106
See e.g., Images Hair Sols Med. Ctr., 2013 WL 6917138, at *4-5.

21
Grosz and Mechanism.107 The final section of the Article discusses Grosz’s conduct

which led to Toptal’s initiation of the Nevada lawsuit, including Grosz’s pitch to

“The Information,” a news platform, to run an article in hopes the “bad press would

drive away customers.”108

It is also pertinent to consider the Article’s use of “investor” in relation to the full

Article. The Article characterizes Grosz’s “investments” as a “form of debt – a

convertible note that converts to equity when a startup raises more cash.” 109 It also

explains the equity conversion as occurring “when Toptal convert[s] from a limited

liability company to a corporation”110

The Court finds this statement survives dismissal. First, Toptal alleges

characterizing Grosz as an “investor” is false. In accordance with Ramunno, the

Court acknowledges its duty to draw a reasonable inference in favor of Toptal in

determining how the reasonable reader would interpret “investor.” Second, Toptal

adequately pleads the statement is substantially false because it could suggest to the

reasonable reader that Grosz’s “bet,” and not his misconduct, led to the Nevada

litigation. Finally, Toptal sufficiently pleads defamation per se by alleging the

statement maligned its business by conveying the idea to prospective colleagues that

Toptal sued Grosz to avoid an equity conversion. Additionally, to support its

107
D.I. 13 Ex. 5 p.1.
108
Id. Ex. 5 p.4.
109
Id. Ex. 5 p.2.
110
Id. Ex. 5 p.1.

22
defamation per se claim, Toptal specifically pled to two occasions in which a

colleague cut ties with Toptal because of the Publications.111 On its face, the

Complaint does not suggest this statement is merely expressing an opinion or dislike.

2. Investor Outlay Statements

The next statement Toptal finds false and defamatory from the Article is “the

startup [Toptal] has denied early investors a return by refusing to switch their

decade-old convertible debt commitments into equity, tying up their holdings even

as the company has flourished. Without equity, they can’t sell their interest in

Toptal, making their outlay worth little more than the day they invested.” 112 The

Revision, only impacting the second portion, states “[w]ithout equity, their outlay is

worth little more than the day they invested.”113 Toptal raises concerns that this

statement (1) falsely represents that Toptal was to blame for early investor’s holdings

being “tied up” in the company and (2) incorrectly reports the amount that Grosz

made back from his note.114

Bloomberg argues the first portion of the statement is “substantially accurate”

because the noteholders’ convertible debt instruments “were not otherwise available

to invest.”115 Bloomberg further contends the statement, if not provable, is certainly

111
See D.I. 1 ¶¶ 109, 129-30.
112
D.I. 17 p.18 (citing D.I. 1 ¶100, Ex. 6).
113
D.I. 1 Ex. 6.
114
Id. p.18-19; D.I. 1 ¶ 100.
115
D.I. 13 p.23-24.

23
not defamatory because it “simply reflects the Notes’ contractual requirements.”116

Toptal responds that the statement “falsely blames” Toptal for Grosz’s decisions to

lend money to Toptal, to not convert his note to equity before the option lapsed, and

to not accept Toptal’s tender of principal and interest. Toptal also contends it was

false for Bloomberg to report that Grosz “can’t sell [his] interest in Toptal,” because

Grosz did not have an interest in Toptal. 117

The Court finds the Complaint adequately pleads the defamatory nature of this

statement. Toptal alleges the statement’s false representation that Grosz had an

interest in Toptal to sell.118 Further, Toptal pleads the statement would cause a

reasonable reader to hold Toptal accountable for Grosz’s independent decisions

which left Grosz with no equity conversion nor principal and interest on his note.119

These allegations are sufficient to support the statement’s Rule 12(b)(6) survival.

Bloomberg asserts reading the statement “worth little more” with context

demonstrates that the 4% annual interest that Toptal offered Grosz is in fact “worth

little” when compared to the $100 million Grosz could have received in equity with

Toptal estimated to be worth $1 billion.120 Bloomberg argues if it had reported in a

more straight-forward fashion “that Grosz was disappointed to receive $336,000

116
Id.
117
D.I. 17 p.19.
118
D.I. 1 ¶ 97.
119
Id. ¶ 100.
120
D.I. 13 p.24.

24
instead of $100 million” the statement’s impact on the reader would not change. 121

Bloomberg can establish this statement is “substantially true” if it can show that

tweaking the statement to provide “precise truth” does not change the average’s

reader’s interpretation of the original statement.122 Toptal disputes this because,

according to Toptal, $1,336,000 is a 34% profit on Grosz’s note and that “reasonable

people” could find this to be a significant profit rather than “worth little more” than

Grosz’s initial note.123

Bloomberg argues that the statement “worth little more” is an unactionable

opinion.124 Citing to Ramunno, Toptal disputes this claim arguing that Bloomberg

failed to disclose all facts necessary for the average reader to appreciate the truth

behind its “worth little more” statement.”125

In Ramunno, the Delaware Supreme Court reversed the dismissal of a defamation

action by the lower court holding that it “failed to recognize the potentially

defamatory factual basis imbedded in the statement,” and reasoned that,

[A]n opinion may often imply an assertion of objective fact and, if the
implied fact may be found to be false the trier of fact may find the
plaintiff to have been libeled….Even if the speaker states the facts upon
which he bases his opinion, if those facts are either incorrect or
incomplete, or if his assessment of them is erroneous, the statement may

121
Id.
122
See Riley, 529 A.2d at 253-54 (holding the article’s suggestion that plaintiff-politician was using “golf outings” to
discuss future projects with developers was “substantially true,” despite not being precisely accurate, because
plaintiff conceded to attending meals with interested parties to discuss projects).
123
D.I. 17 p.20.
124
D.I. 13 p.25.
125
D.I. 17 p.20.

25
still imply a false assertion of fact. Simply couching such statements in
terms of opinion does not dispel these implications.126

As discussed above, the Delaware Supreme Court in Riley v. Moyed adopted the

four-part test in Ollman v. Evans used to determine whether a statement is fact or

opinion.

First, the Court looks to the common usage or meaning of the statement “worth

little more.” While the phrase is generally understood to indicate a small comparison

of value, what that value is could be dependent on the reader’s perspective. The

parties’ dispute demonstrates this: Bloomberg perceives “worth little more” as

relating to Grosz’s 4% annual interest compared to what a 10% equity interest in

$100 million would be; whereas Toptal takes the phrase to refer to the 34% return

Grosz received on his note which would be comparing a $336,000 profit to the

original $1,000,000 Grosz gave. The plain language of the whole statement suggests

the phrase could be interpreted either way because the statement mentions Grosz’s

return “without equity” and compares his initial “outlay” with his return.

Second, the Court analyzes whether the statement “worth little more” can be

objectively verified as true or false. Considering both parties provided concrete

numbers in their briefing, it seems that an objective comparison can be made.

However, as displayed by the parties’ contradictions, there are different

126
Ramunno, 705 A.2d at 1036-37.

26
interpretations on what “worth little more” is referring to and if that value is actually

“worth little more.”

Finally, the Court considers the context of the statement “worth little more”

within the entire Article as well as the social context surrounding the statement. As

previously discussed, the context of the Article and the Nevada litigation provides

necessary insight into the challenged statements. Considering the parties’

interpretative dispute and the Court’s duty to accept reasonable inferences in favor

of Toptal, the Court currently finds this statement actionable.

Bloomberg contends the above statements are not defamatory per se because they

merely report on “a corporation successfully enforce[ing] the terms of its note

agreements.”127 Bloomberg cites to Danias v. Fakis to support its assertion that even

if the statement is “untrue, it is not libelous per se to have charged [Toptal] with

doing nothing more than an act [it] could properly and lawfully do.”128 In Danias,

the Court held it was not defamatory per se for the defendant to spread a false rumor

that the plaintiff informed Federal Immigration Authorities that a third person was

illegally residing in the country.129 The Court reasoned informing authorities of the

presence of an illegal immigrant is not “unlawful or improper conduct.”130 Toptal

opposes this argument and contends that the statement attacks Toptal’s “integrity

127
D.I. 13 p.25.
128
Id. (citing Danias v. Fakis, 261 A.2d 529, 531 (Del. Super. 1969)).
129
Danias, 261 A.2d at 531.
130
Id.

27
and fitness” by accusing it of “withholding funds from investors and failing to pay

the return it owes.”131 Toptal asserts this is clearly defamation per se.132

The Court finds that the statement on its face could suggest more to a reasonable

reader than merely a report that Toptal was acting lawfully and properly by

complying with the Convertible Note Agreements. The Court in Danias held the

specific conduct purported in the alleged defamatory statement could not be

defamatory per se because it was lawful conduct. The same is not true here. A facial

reading of the statement does not make it clear to the Court that the Article simply

suggests Toptal sees its contracts through. As previously discussed, the Complaint

also alleges specific circumstances in which professionals in Toptal’s field cited to

the Article as the basis for not working with Toptal. For these reasons, the Court

finds Toptal adequately pleads defamation per se as to these statements.

3. Equity Rights Statements

Toptal also alleges the following statements from the Article are false and

defamatory, “Grosz’s deal included rights to around 10% of the company after its

first equity financing. But Grosz didn’t get his stake: Toptal never raised more

equity, and a conversion never happened.”133 The Revision changed the second

sentence to: “But Grosz didn’t get that stake: a conversion never happened.”134

131
D.I. 17 p.21-22.
132
Id.
133
Id. p.22 (citing D.I. 1 ¶102).
134
D.I. 1 Ex. 6.

28
The Complaint alleges stating that Grosz and Toptal had a “deal” to give Grosz

“rights to 10% in equity in Toptal” is false because the Nevada Court held that Grosz

“never acquired a right to obtain equity in Toptal.”135 In response, Bloomberg urges

review of the statement in its entirety maintaining it relays to the reader that Grosz’s

rights were triggered only “after [Toptal]’s first equity financing,” the first equity

financing did not occur, and, thus, “conversion never happened.”136 Toptal asserts,

if that is what Bloomberg was intending to relay, it should have also reported that

“the note agreement expressly authorized everything Toptal did” and that Grosz’s

conversion rights expired in 2014.137

Bloomberg argues that the statement simply conveys that Toptal “enforced its

contract, particularly in an Article that expressly stated that it defeated a breach claim

brought by its counterparty.”138 However, the parties dispute whether the Article’s

context refers to the breach of contract claim pertaining to the Advisor Agreement,139

or the Convertible Note Agreements.140 The Article states, “in affirmative defenses

against Toptal, Grosz and Mechanism alleged…breach of contract of his advisory

agreement. Toptal was not found liable.”141 This is the Article context Toptal relies

on in maintaining that this does not support Bloomberg’s argument because the

135
D.I. 1 ¶102.
136
D.I. 13 p.26.
137
D.I. 17 p.23-24.
138
D.I. 13 p.26-27.
139
D.I. 17 p.24.
140
D.I. 24 p. 17 n.6.
141
D.I. 13 Ex. 5.

29
breach claim in the Nevada litigation concerned Grosz’s Advisor Agreement, not the

Convertible Note Agreements.142 The Court agrees this statement would do little to

support Bloomberg’s argument.

Meanwhile, Bloomberg asserts it is clear from the context of the statement, “the

judge made an additional ruling in October on a pre-trial motion filed by Toptal:

Grosz’s ability to demand any equity stake had expired when his convertible notes

hit their maturity date in 2014,” that the Article conveys that Toptal did not breach

its Convertible Note Agreements with Grosz.143 This statement imparts to the reader

the Nevada Court’s ruling that Toptal did not owe equity to Grosz at the time of

litigation. However, it does not affirmatively support the notion that Toptal enforced

the Convertible Note Agreements. To the Court, this is another example of an

interpretative dispute which must be weighed in favor of Toptal at the motion to

dismiss stage.

It appears to the Court that this statement withstands the instant Rule 12(b)(6)

Motion. Toptal properly alleges the falsity of the statement’s representation that

Grosz and Toptal had a “deal” giving Grosz “rights to 10%.” Further, the Court

finds it is reasonably conceivable from Toptal’s pleadings that the average reader

could interpret the statement to propose that Toptal failed a duty to Grosz under the

142
D.I. 17 p.24.
143
D.I. 24 p.17 n.6.

30
Convertible Note Agreements to raise more equity. For these reasons, the Court

finds Toptal’s Complaint adequately pleads another false and defamatory statement.

4. Potential Conversion Statements

Finally, Toptal alleges the following statement from the Article is false and

defamatory, “Grosz could still see an equity conversion – Toptal raising more money

would trigger one.”144 Toptal contends the statement is false because the Nevada

court held “Grosz chose not to exercise his option before it expired, meaning the

equity provisions in his agreement ceased to operate and could no longer be

triggered.”145

The Revision rewrites this statement as: “Grosz cannot currently expect an equity

conversion, unless his ongoing appeal to overturn part of the court’s decision is

successful.”146 Bloomberg contends the Revision does not make the original

statement false and “at most conveys a ‘minor inaccurac[y]’” of a substantially true

statement.147 Bloomberg emphasizes that the Revision is a clarification of the

original statement “both communicat[ing] that Grosz could only receive equity in

Toptal subject to a condition precedent.”148 Bloomberg further argues the context

of the entire Article relays to the reasonable reader that the Nevada Court’s ruling

144
D.I. 17 p.24 (citing D.I. 1 ¶104).
145
D.I. 17 p. 24.
146
D.I. 1 Ex. 6.
147
D.I 13 p.27 (citing Masson v. New Yorker Magazine, Inc., 501 U.S. 496, 517 (1991) (“The common law of libel
takes but one approach to the question of falsity, regardless of the form of communication. It overlooks minor
inaccuracies and concentrates upon substantial truth.”) (emphasis added)).
148
D.I. 13 p.28.

31
hindered Grosz’s ability to demand equity.149 Toptal maintains that the Revision is

“conclusive proof of falsity” because the Revision contradicts the original

statement.150

The Nevada Court, in granting summary judgment as to Grosz’s breach of

contract claim against Toptal, held the Convertible Note Agreements did not provide

Grosz with a “perpetual option” to convert to equity. 151 The Nevada Opinion

reasoned that Grosz did not elect to convert before the maturity date; therefore,

Toptal did not breach the Convertible Note Agreements by refusing to perform in

response to Grosz’s post-maturity date elections.152 The Article states this ruling

and that it is under appeal.153

The pleadings show that, in the Nevada litigation, Grosz raised on appeal the

issue of equity conversion after the maturity date.154 The Revision conveys that

Grosz’s ability to convert is contingent on the ongoing appeal.155 The parties dispute

over whether both the original and Revised statement convey the same message to

the reasonable reader – if Grosz could still see an equity conversion.

149
D.I. 17 p. 27 (citing D.I. 1 Ex. 6 (“[T]he judge made an additional ruling in October on a pre-trial motion filed by
Toptal: Grosz’s ability to demand any equity stake had expired when his convertible notes hit their maturity date in
2014.”)
150
Id. p.25.
151
D.I. 1 Ex. 1 p.6.
152
Id. Ex. 1 p.6-7.
153
D.I. 13 Ex.5.
154
See D.I. 13 Ex. 4 p.11 (A principal issue Grosz raises on appeal is “[w]hether the District Court erred in concluding
that an optional conversion right in a Convertible Note providing the noteholder with the option to convert his
investment to equity “[a]t any time on or after the fifteenth (15th) day prior to the Maturity Date” expires on the
Maturity Date.”)
155
D.I. 1 Ex. 6.

32
Whether the context discussed above relays to the average reader the likelihood

of Grosz receiving equity in Toptal is a question for a later day. At this stage, the

Court finds that Toptal has adequately pled the false and defamatory nature of both

the original statement and the Revision.

As to the above challenged statements, the Court finds that Toptal has more

adequately pled false and defamatory statements than the cases in Delaware courts

whose defamation claims have been dismissed at this early stage of litigation.156

Moreover, Toptal alleges several circumstances of the Article resulting in Toptal’s

injured reputation.157 Whether changes to the Article would have the same effect on

readers and if the “gist” of the Publications are substantially true are issues that still

stand and should be considered with a more developed record of the case.

The Column

Unlike the Article, Levine’s commentary in the Column is not defamatory. The

Complaint alleges the Column is false and defamatory for several reasons: (1) it

repeated defamatory statements from the Article; (2) it is titled The FTC Comes for

Noncompetes, yet the Article does not concern noncompetes; and (3) it includes that

156
Page v. Oath Inc., 270 A.3d 833, 836 (Del. 2022) (affirming Superior Court’s dismissal because the article was
“substantially true”); Owens v. Lead Stories, LLC, 2021 WL 3076686, at *12-13 (Del. Super. July 20, 2021) (holding
challenged statements “do not convey facts that are untrue or capable of a defamatory meaning because they do not
injure the plaintiff’s reputation); Holmes v. News-Journal Co., 2015 WL 1893150, at *2 (Del. Super. Apr. 20, 2015)
(holding the article was substantially true); Images Hair Sols. Med. Ctr., 2013 WL 6917138, at *4 (holding the
challenged statements did not surpass the Ward three-part test evaluating the statements’ content, verifiability, and
context); Riley, 529 A.2d 148 (finding the challenged statements were not defamatory because they were either
expressions of opinion or “substantially true”).
157
D.I. 1 ¶¶ 109, 129-31.

33
“Grosz ‘rejected’ the attempt to pay him an amount equal to principal and accrued

interest” without informing the reader of the Nevada Court’s ruling that Toptal did

not breach the Convertible Note Agreements.158

As to the first point, the Column’s use of the Article’s alleged defamatory

statements does not automatically make the Column defamatory. Just as the Court

did for the Article, it considers the challenged statements in the context of the entire

Column.159 In Ramada Inns v. Dow Jones & Co, the Court held excerpts from a

prior article were protected because they were “minimal references which merely

provide[d] context.”160 Similarly, the Column utilizes excerpts from the Article as

a “fact pattern” to distinguish the standard convertible-debt payout scenario.161

Second, the title of the Column does not make the statements on Toptal

defamatory. The Column goes through several topics in addition to noncompetes –

convertible bonds being one of them.162

Finally, the Column does not indicate that Toptal breached the parties’

agreement. In fact, the Column states that Toptal’s attempt to pay Grosz back his

principal plus interest and Grosz’s choice to reject that was “reasonable, on both

sides.”163 Further, the Column maintains that Toptal keeping Grosz’s convertible

158
D.I. 1 ¶¶ 111-14.
159
Ramada Inns, Inc. v. Dow Jones & Co., Inc., 543 A.2d 313, 327 (Del. Super. Sept. 30, 1987).
160
Id. at 328.
161
D.I. 13 Ex. 6 p.8 (“…but I have never seen this fact pattern before:”) (original emphasis).
162
See Id. Ex. 6.
163
Id Ex. 6 p.9.

34
bond outstanding is “another entirely possible upside case,” and includes that Toptal

had a “choice” to keep the outstanding convertible bond or convert it to equity.164

Therefore, there was no need for the Column to bring up the Nevada litigation’s

outcome.

The Column dedicates a very small portion to discussing Toptal. Besides the

Article excerpts, the entire section is three paragraphs of Levine’s commentary on

convertible-bonds and the Grosz-Toptal scenario.165 Levine’s commentary never

calls Grosz an investor nor implies that Grosz’s “bet” landed him on the receiving

end of a lawsuit. The commentary does not say or imply that Toptal denied early

investors a return by refusing to switch their convertible debt into equity nor does it

comment on the value of Grosz’s bond.

In contrast to the Article, the Column does the following: (1) accurately conveys

the relationship of the parties; (2) spells out the terms of the parties’ agreement; (3)

makes clear that Grosz was not entitled to an equity stake unless Toptal sought out

more investor cash; and (4) clearly sets forth the parties’ rights and obligations to

each other under the deal.

164
Id. Ex. 6 p.8-9.
165
See Id. Ex. 6 p.8-9.

35
Applying Ramunno leads to but one conclusion: the Column includes only

Levine’s opinion which is rooted in objective fact.166 Therefore, the Column is not

false nor defamatory.

The next question is whether the Column’s hyperlink to the Article constitutes an

actionable republication. The Court is unable to find Delaware cases applying

Delaware law to the question of republication.167 In Perlman v. Vox Media, the

Court of Chancery, applying California law, denied a motion to dismiss.168 After

Perlman was transferred to this Court, Judge Wallace, applying California law,

concluded that there was no republican by hyperlink because “to find that a

publication constitutes a new edition due to its new audience, the publication itself

must be altered, not its marketing.”169 This decision follows the body of case law

that stands for the proposition that liability for republication depends on the

republished article containing independent defamatory statements or that the

republished article restated the prior defamatory statements.170

I find that, beyond the link, the Column did not restate the prior defamatory

statements. Given that I have concluded that the Column does not contain any

166
Ramunno, 705 A.2d at 1036-37.
167
Incyte Corp. v. Flexus Biosciences, Inc, 2017 WL 7803923, at n.39 (Del. Super 2017).
168
Perlman, et. al. v. Vox Media, Inc., 2015 WL 5724838, at *20 (Del. Ch. Sept. 30, 2015).
169
Perlman v. Vox Media, Inc., 2020 WL 47303406, at *2 (Del. Super. Aug. 14, 2020).
170
See Lokhov v. Halper, 995 F.3d 134, 142 (4th Cir 2021); In Re Phila. Newspapers, CCL, 69 F.3d 161 (3rd Cir 2012);
Mirage Entm’t, Inc v. FEG Entretenimientos S.A., 326 F.Supp.3d 26 (S.D.N.Y. 2018).

36
independent defamatory statements, there is no liability related to the Column

merely because the Article was hyperlinked to it.

Toptal’s claims against the Column are DISMISSED.

C. Defamation by Implication

Much of Bloomberg’s brief addressing defamation by implication applies New

York’s heightened standard. Because the Court has already addressed that New

York law does not apply, the Court will not address this portion of Bloomberg’s

argument.

Delaware case law lacks a developed defamation by implication standard.

However, this Court has applied a Third-Circuit standard which acts to heighten the

actual malice standard applicable in a public figure case.171 The standard holds that

when alleging defamation by implication, the plaintiffs must “show something that

establishes defendants’ intent to communicate the defamatory meaning,” or

“reckless disregard for the defamatory meaning of a statement.”172

While Toptal’s Complaint alleges Bloomberg acted with actual malice, the

parties’ briefing does not mention whether Toptal is a public figure. The Complaint

alleges that Bloomberg “knew, or at least recklessly disregarded” the falsity of the

published statements because “the false allegations are contradicted by publicly filed

171
ShotSpotter Inc., 2022 WL 2373418, at *14 (“The standard for malice is heightened in a defamation by
implication case.”)
172
Id. (quoting Kendall v. Daily News Pub. Co., 716 F.3d 82, 90 (3d. Cir. 2013)).

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court documents in the Nevada court case, many of which Du Val had directly

provided to McBride.”173

If at a later date the Court finds the actual malice standard is applicable, it will

apply the heightened standard discussed above and required by a defamation by

implication allegation under Delaware law. At this time, the Court finds Toptal has

adequately pled Bloomberg’s intent to defame or reckless disregard to the

statements’ defamatory meanings.

D. Fair-Report Privilege

The fair-report privilege safeguards media outlets from liability for publishing

“an accurate and fair abridgment of a judicial proceeding.”174 An accurate account

means the reporting “conveys to the persons who read it a substantially correct

account of the proceedings.175 To remain fair, the publication must ensure “nothing

be omitted or misplaced in such a manner as to convey an erroneous impression to

those who hear or read it.”176 The privilege only applies to “reports about

proceedings, not the underlying facts.”177 The justification for this privilege is the

“interest of the public in having information made available to it of what occurs in

173
D.I. 1 ¶145.
174
Read v. News-Journal Co., 474 A.2d 119, 121 (Del. 1984) (citing Restatement (Second) of Torts §611 (1976)).
175
Restatement (Second) of Torts § 611 cmt. f.
176
Id.
177
U.S. Dominion, Inc. v. Fox News Network, LLC, 293 A.3d 1002, 1060 (Del. Super. Mar. 31, 2023).

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such proceedings.”178 Examples in Delaware case law demonstrate application of

the fair-report privilege.179

Bloomberg argues that the Publications give a “substantially accurate”

description of the Nevada litigation and, therefore, the fair-report privilege

immunizes the Publications from suit.180 Bloomberg points specifically to the

Publications’ recitation of “the jury verdicts, quoted emails ‘shown in court,’ and

‘cit[ing] a February 2024 docketing statement that Grosz filed with Nevada’s

Supreme Court.”181 Moreover, Bloomberg – citing to the Nevada Litigation’s

Complaint, Grosz’s countersuit, and Grosz’s appeal statement – asserts the

Publications accurately report the records of the Nevada litigation.182

Toptal contends the fair-report privilege does not apply because the challenged

statements were not reporting on the Nevada litigation’s proceedings.183 Toptal

asserts that merely mentioning the Nevada litigation is not enough to invoke the

privilege.184

178
Read, 474 A.2d at 121.
179
See Brisco v. Delaware State Police, 2024 WL 1575105, at *3-4 (Del. Super. Apr. 11, 2024) (finding the news
publication was a fair and accurate reporting of the police report it was writing on, even though the information in
the police report was incorrect);Read, 474 A.2d at 121 (holding “a comparison of the news article with the Opinion
being reported fail[ed] to disclose an unfairness or inaccuracy sufficient to overcome defendants’ fair report
privilege.” (citing Restatement (Second) of Torts § 611 (1976))).
180
D.I. 13 p.36.
181
Id. p.35.
182
Id.
183
D.I. 17 p. 31.
184
Id.

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While a portion of the Article recounts the judicial proceedings of the Nevada

litigation, the challenged statements concern underlying facts – the nature of Grosz

and Toptal’s relationship and their Convertible Note Agreements.

In Delaware, the fair-report privilege is generally applied where either the sole

focus of the publication is the privileged proceeding or the challenged statements are

directly reporting on it.185 The Publications do more than just report on the Nevada

litigation. They discuss underlying facts and provide commentary.

The only challenged statement that could be considered a direct account of the

litigation is that “Grosz cannot currently expect an equity conversion, unless his

ongoing appeal to overturn part of the court’s decision is successful.” The Nevada

Court ruled on summary judgment that Grosz’s ability to convert had lapsed.186 The

appeal referred to in the above challenged statement is Grosz’s appeal from this

summary judgment decision.187 However, this statement is a revision.188 As stated

above, Toptal expresses concern with the original statement which is entirely

underlying fact and does not reference the Nevada litigation.189

185
See Brisco, 2024 WL 1575105, at *2-4 (the challenged statement came directly from the report issued by
Delaware State Police); Page, 2021 WL 52472, at *3-4, aff’d, 270 A.3d 833 (applying the fair-report privilege to an
article reporting on a government investigation); Read, 474 A.2d at 120 (“The Complaint shows on its face that the
news article was privileged and that the privilege was not abused.”)
186
Id. p.27 (citing D.I. 1 Ex. 1, Nevada Court’s Order Granting, in part, Toptal, LLC’s Motion for Summary
Judgment).
187
D.I. 13 p. 7 (citing D.I. 13 Ex. 4, Grosz’s Civil Appeal Docket Statement).
188
D.I. 1 ¶ 122.
189
D.I. 17 p.24-26; see D.I. 1 ¶ 104.

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At this point, Bloomberg has not shown the Court that the challenged statements

are “fair and accurate” accounts of the Nevada litigation such that the fair-report

privilege immunizes Bloomberg from this suit.

CONCLUSION

The Court finds, in consideration of the above contentions and relevant Delaware

case law, Toptal pleads sufficient allegations of defamation and defamation per se

as to the alleged false and defamatory statements in the Publications.

For the above reasons, the Court DENIES Bloomberg’s Motion to Dismiss as to

the Article and GRANTS Bloomberg’s Motion to Dismiss as to the Column.

IT IS SO ORDERED.

/s/ Francis J. Jones, Jr.
Francis J. Jones, Jr., Judge

cc: Counsel of Record via File&ServeXpress

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