Priveterra Capital Management, LLC v. Pixium Vision, LLC

IN THE SUPERIOR COURT OF THE STATE OF DELAWARE

PRIVETERRA CAPITAL, )
MANAGEMENT, LLC, )
Plaintiff, )
)
v. ) C.A. No. N26C-03-334 PRW
) CCLD
PIXIUM VISION, LLC and )
PIXIUM VISION SA, )
Defendants. )

Submitted: March 18, 2026
Decided: April 7, 2026

Upon Defendant Pixium Vision, LLC’s
Motion to Dismiss,
GRANTED.

Upon Defendant Pixium Vision SA’s
Motion to Dismiss,
GRANTED.

MEMORANDUM OPINION AND ORDER

Peter J. Walsh, Jr., Esquire, and Tyler J. Leavengood, Esquire, POTTER ANDERSON
& CORROON LLP, Wilmington, Delaware; Wesley J. Horton, Esquire (argued), and
Jason de Bretteville, Esquire, STRADLING YOCCA CARLSON & RAUTH, P.C., Newport
Beach, California, Attorneys for Plaintiff Priveterra Capital Management, LLC.

A. Thompson Bayliss, Esquire, and Adam K. Schulman, Esquire (argued), ABRAMS
& BAYLISS LLP, Wilmington, Delaware, Attorneys for Defendant Pixium Vision,
LLC.

Kevin M. Coen, Esquire (argued), and Cassandra L. Baddorf, Esquire, MORRIS,
NICHOLS, ARSHT & TUNNELL LLP, Wilmington, Delaware, Attorneys for Defendant
Pixium Vision SA.

WALLACE, J.
This dispute arises from a Letter of Intent (“LOI”) where Plaintiff Priveterra

Capital Management, LLC, sought to acquire Defendants Pixium Vision, LLC

(“Pixium LLC”) and Pixium Vision SA (“Pixium SA”) (collectively, the

“Defendants”).1 Pixium LLC is Pixium SA’s wholly owned subsidiary. After

signing the LOI, Priveterra undertook efforts to eventually buy the Defendants. But

the deal didn’t come to fruition and Pixium SA eventually entered into French

bankruptcy proceedings. Priveterra has brought claims for: (1) breach of contract;

(2) breach of the implied covenant of good faith and fair dealing; and (3) fraudulent

inducement.2 The Defendants have moved to dismiss that complaint.

For the foregoing reasons, both motions to dismiss are GRANTED and

Priveterra’s complaint is dismissed.

I. BACKGROUND

The Court draws the following background from Priveterra’s complaint and

the documents it incorporates by reference.

A. THE PARTIES

Priveterra is a Delaware limited liability company.3

Pixium SA is a French Société Anonyme.4 Pixium LLC is its subsidiary and

1
See generally Compl. (D.I. 1).
2
See generally id.
3
Id., ¶ 2.
4
Id., ¶ 4.

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also a Delaware limited liability company.5 As to those entities’ relationship:

Pixium SA owned 100% of the share capital of its subsidiary Pixium LLC6 and was

the sole member of Pixium LLC.7

B. LOI LEAD-UP AND NEGOTIATIONS

Throughout 2023, Priveterra and the Defendants negotiated a potential

business combination whereby Priveterra would ultimately own the Defendants.8

During negotiations, individuals associated with Pixium SA referred to and used

Pixium SA and Pixium LLC interchangeably.9 The same personnel worked for the

Defendants and signed documents on behalf of both Defendants.10 The Defendants

had fully consolidated financial statements.11

In connection with the negotiations, Pixium SA CEO Lloyd Diamond assured

Priveterra personnel that he was in contact with the Defendants’ creditors and that

those creditors were willing to negotiate the terms of a financing agreement with

Pixium.12 At the same time, Mr. Diamond presented to the Defendants’ Board that

5
Id., ¶ 3.
6
Id., ¶ 15.
7
Id., ¶ 16.
8
Id., ¶ 8.
9
Id., ¶ 14.
10
Id., ¶ 22.
11
Id., ¶ 20.
12
Id., ¶ 9.

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the Pixium entities were set to run out of cash in September 2023.13 Mr. Diamond’s

assurances led Priveterra to believe that creditor negotiations were well underway.14

This would result in the Defendants rolling their debt position into equity or equity-

linked instruments upon a new transaction.15 Relying on Mr. Diamond’s assertions,

Priveterra signed the LOI.16

C. RELEVANT LOI PROVISIONS

Section 5 of the LOI reads:

Except as set forth in the Term Sheet or in any Definitive Agreements
entered into by the Parties, each of the Parties will pay its own costs
and expenses (including legal, financial advisory, consulting and
accounting fees and expenses) incurred at any time in connection with
pursuing or consummating the Proposed Transaction; provided that if
this LOI is terminated by the Company pursuant to paragraph 6(c)
below (provided the Public Entity (or, prior to assignment of this LOI
in accordance with Section 10, Priveterra) has used commercially
reasonable efforts in negotiating definitive documentation), the
Company will, subject to a cap of $1.8 million, reimburse Priveterra or
its designee (including the Public Entity) for the fees, costs and
expenses actually and reasonably incurred in connection with (x) the
acquisition by Priveterra of the Public Entity, (y) payments made into
the Trust Account in order to secure an extension of the life of the
Public Entity, or (z) in pursuit of the transactions contemplated by the
Definitive Agreement.17

Section 6(c) allows the Defendants to terminate the LOI following the Exclusivity

13
Id., ¶ 10.
14
Id., ¶ 11.
15
Id., ¶ 11.
16
Id., ¶ 12.
17
See id., ¶ 27; Compl., Ex. 1 (the “LOI”) § 5 (underlining in original).

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Period’s expiration, upon giving written notice to the parties.18 The Exclusivity

Period is the sixty days after Priveterra’s LOI assignment.19 Priveterra and Pixium

SA agreed to raise Section 5’s reimbursement requirement to $2 million.20

Additionally, LOI Section 10 states:

None of the Parties shall be entitled to assign this LOI without the
consent of the other Parties; provided, that Priveterra shall be entitled
to assign this LOI to the Public Entity immediately upon the closing of
the direct or indirect acquisition of the Public Entity (including through
an acquisition of the control of Tastemaker Sponsor LLC, the Public
Entity’s sponsor).
D. PRIVETERRA’S EFFORTS TO CLOSE THE DEAL

From June through September 2023, Priveterra consistently engaged with the

Defendants and the Defendants’ advisors to develop documentation for the Proposed

Transaction.21 Priveterra spent over $2 million in connection with the Proposed

Transaction.22 In September, upon Priveterra discovering that the Defendants were

struggling to secure financing to continue operations, Priveterra offered to provide

18
Compl., ¶ 28; LOI § 6:
In consideration of the time, effort and expense to be undertaken by the Parties
in connection with the Proposed Transaction, upon assignment of this LOI by
Priveterra to the Public Entity in accordance with paragraph 10, each of the
Public Entity and the Company agrees that, during the sixty (60) day period
(which may be extended by mutual consent of the parties) following such
assignment (the “Exclusivity Period”) . . . .
19
LOI § 4.
20
Compl., ¶ 30.
21
Id., ¶ 32–37.
22
Id., ¶ 35.

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the Defendants with capital.23 The Defendants declined.24

Ultimately, the Defendants ran out of financing.25 In October 2023, Pixium

SA entered safeguard proceedings in the Commercial Court of Paris.26 Upon

discovering these proceedings, Priveterra notified the Defendants of their

responsibility to pay $2 million to Priveterra under LOI Section 5.27 The Defendants

refused to pay, and this litigation commenced.28

E. PROCEDURAL HISTORY

Priveterra initially filed this action in the Court of Chancery purportedly under

that Court’s statutory jurisdiction pursuant to 8 Del. C. § 111(a)(2).29 Except that

subsection applies to corporations, not limited liability companies. And Priveterra

23
Id., ¶ 37.
24
Id., ¶ 39.
25
Id., ¶ 38.
26
Id., ¶ 41.
27
Id., ¶ 44.
28
Id., ¶ 45.
29
That subsection states that the Court of Chancery has jurisdiction to interpret, apply, or
determine the validity of:
[a]ny instrument, document or agreement (i) by which a corporation creates or
sells, or offers to create or sell, any of its stock, or any rights or options
respecting its stock, or (ii) to which a corporation and 1 or more holders of its
stock are parties, and pursuant to which any such holder or holders sell or offer
to sell any of such stock, or (iii) by which a corporation agrees to sell, lease or
exchange any of its property or assets, and which by its terms provides that 1
or more holders of its stock approve of or consent to such sale, lease or
exchange.
DEL. CODE ANN. tit. 8, § 111(a)(2) (2026).

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doesn’t seek any equitable relief that might divest the Superior Court of subject

matter jurisdiction.30 As a result, the case was transferred to this Court.31 Still, for

efficiency’s sake, the undersigned heard arguments on the Rule 12(b)(6) aspects of

the motions to dismiss at oral argument, with all knowing then that the case would

be transferred.32 Now with the case is in the proper court, and arguments having

been heard, the motions to dismiss are ripe for a decision.

II. PARTIES’ CONTENTIONS33

A. THE DEFENDANTS

Pixium SA avers that Priveterra’s causes of action fail to state a claim.34 For

the breach-of-contract claim, Pixium SA insists that there is no breach, as it did not

have a duty to reimburse fees.35 For the good-faith-and-fair-dealing claim, Pixium

highlights that Priveterra has not shown an implied condition—so no breach.36 For

the fraud claim, Pixium maintains that the elements of fraud are not satisfied, and

30
See generally Compl.
31
D.I. 2 Ex. A (Stipulation and Order); See Massachusetts Mut. Life Ins. Co. v. Certain
Underwriters at Lloyd’s of London, 2010 WL 3724745, at *2 (Del. Ch. Sept. 24, 2010) (“If this
Court lacks jurisdiction, the case can be transferred to an appropriate Delaware court.”).
32
See generally Hr’g Tr. (D.I. 9).
33
Again, for the sake of efficiency, the parties transferred their briefing as-is from the Chancery
action. And now, since the subject matter jurisdiction issue is resolved, the Court need not re-
summarize those arguments from the briefing.
34
See generally Def. Pixium Vision SA’s Op. Br. in Supp of Mot. to Dismiss Compl. [hereinafter
“Pixium SA Op. Br.”] (D.I. 4).
35
Pixium SA Op. Br. at 11–14 (D.I. 4).
36
Id. at 15.

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Priveterra does not allege distinct damages to overcome the Bootstrap Doctrine.37

Pixium SA also claims that French bankruptcy law bars Priveterra’s suit because

Priveterra did not declare its claims in the safeguard proceeding.38

Pixium LLC contends that Priveterra has failed to state a claim against it for

breach of contract or breach of the implied covenant of good faith since Pixium LLC

did not sign the LOI and did not adopt the LOI.39

B. PRIVETERRA

In reply, Priveterra maintains that it has adequately pled its claims against the

Defendants.40 For the breach of contract, Priveterra suggests that the Defendants are

contractually bound to reimburse Priveterra and, alternatively, Priveterra has

submitted a reasonable interpretation to a survive motion to dismiss.41 On the

implied covenant and fraud claims, Priveterra posits that those claims are not

duplicative of the breach-of-contract claim and otherwise are well-pled to surmount

the motion-to-dismiss stage.42 Priveterra also argues that it was not required to

37
Id. at 16–21.
38
Id. at 21–23.
39
Defendant Pixium Vision, LLC’s Op. Br. in Supp of Mot. to Dismiss the Verified Second
Amended Compl. [hereinafter “Pixium LLC Op. Br.”] at 5–10 (D.I. 7).
40
Pl.’s Answering Br. in Opp’n to Defs.’ Motions to Dismiss the Verified Second Amended
Compl. [hereinafter “Answer Br.”] at 8–17. (D.I. 10).
41
Id. at 8–11.
42
Id. at 11–17.

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submit a claim in the French safeguard proceedings.43 Lastly, Priveterra claims that

it has adequately pled that Pixium LLC adopted the LOI and adequately alleged an

alter-ego theory of liability.44

III. STANDARD OF REVIEW

The Defendants seek dismissal under Rule 12(b)(6) for failure to state a claim

upon which relief can be granted. The governing standard requires the Court to “(1)

accept all well pleaded factual allegations as true, (2) accept even vague allegations

as ‘well pleaded’ if they give the opposing party notice of the claim, [and] (3) draw

all reasonable inferences in favor of the non-moving party.”45 The Court need not

“accept every strained interpretation of [Priveterra’s] allegations”46 or conclusory

statements “unsupported by allegations of specific facts.”47 Dismissal is appropriate

only if Priveterra “would not be entitled to recover under any reasonably conceivable

set of circumstances susceptible of proof.”48

To resolve a contractual question of law at this stage, the motion to dismiss

43
Id. at 17–18.
44
Id. at 17–23.
45
Cent. Mortg. Co. v. Morgan Stanley Mortg. Cap. Hldgs. LLC, 27 A.3d 531, 535 (Del. 2011)
(citing Savor, Inc. v. FMR Corp., 812 A.2d 894, 896–97 (Del. 2002)).
46
Gen. Motors (Hughes) S’holder Litig., 897 A.2d 162, 168 (quoting Malpiede v. Townson, 780
A.2d 1075, 1083 (Del. 2001)).
47
In re Lukens Inc. S’holders Litig., 757 A.2d 720, 727 (Del. Ch. 1999), aff’d sub nom., Walker
v. Lukens, Inc., 757 A.2d 1278 (Del. 2000).
48
Savor, Inc. v. FMR Corp., 812 A.2d 894, 896–97 (Del. 2002).

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must be supported by unambiguous contract terms.49 To dismiss, the movant’s

interpretation must be “the only reasonable construction as a matter of law.”50 But

absent ambiguity, Delaware courts will not destroy or twist the contract’s language

under the guise of construing it.51

IV. DISCUSSION

The Court finds that Priveterra’s claims aren’t well pled. For its breach-of-

contract claim, the LOI’s clear and unambiguous language provides that there wasn’t

a breach as there was no assignment to trigger the Exclusivity Period. On the implied

covenant cause of action, Priveterra fails to identify a gap to be filled or a specific

breach other than a vague overarching duty of good faith. Lastly, Priveterra doesn’t

state a claim for fraudulent inducement as there was no false misrepresentation by

Mr. Diamond.

Since Priveterra’s causes of action are not well-pled, the Court doesn’t reach

the issues of French bankruptcy law’s impact on this action or if Pixium LLC

adopted the LOI.

A. PRIVETERRA HASN’T STATED A BREACH-OF-CONTRACT CLAIM.

To prevail on a breach-of-contract claim, one must show: (1) a contractual

49
Blue Cube Spinco LLC v. Dow Chem. Co., 2021 WL 4453460, at *7 (Del. Super. Ct. Sept. 29,
2021).
50
Id. (quoting VLIW Tech., LLC v. Hewlett-Packard Co., 840 A.2d 606, 615 (Del. 2003)).
51
Id.

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obligation; (2) a breach of that obligation; and (3) resulting damages.52 A court

generally gives priority to the parties’ intentions contained in the four corners of the

contract.53 “In upholding the intentions of the parties, a court must construe the

agreement as a whole, giving effect to all provisions therein.”54 “The meaning

inferred from a particular provision cannot control the meaning of the entire

agreement if such an inference conflicts with the agreement’s overall scheme or

plan.”55 “Specific language in a contract controls over general language, and where

specific and general provisions conflict, the specific provision ordinarily qualifies

the meaning of the general one.”56 “When construing a contract, and unless a

contrary intent appears, [courts] will give words their ordinary meaning.”57

Where the contract’s language is plain and unambiguous, it must be enforced

as written.58 “If a writing is plain and clear on its face, i.e., its language conveys an

unmistakable meaning, the writing itself is the sole source for gaining an

52
See VLIW Tech., LLC v. Hewlett-Packard, Co., 840 A.2d 606, 612 (Del. 2003).
53
Paul v. Deloitte & Touche, LLP, 974 A.2d 140, 145 (Del. 2009).
54
E.I. du Pont de Nemours and Co., Inc. v. Shell Oil Co., 498 A.2d 1108, 1113 (Del. 1985).
55
Riverbend Community, LLC v. Green Stone Engr., LLC, 55 A.3d 330, 334 (Del. 2012) (citation
omitted).
56
Brinckerhoff v. Enbridge Energy Co., Inc., 159 A.3d 242, 256 (Del. 2017), as revised (Mar.
28, 2017) (quoting DCV Holdings, Inc. v. ConAgra, Inc., 889 A.2d 954, 961 (Del. 2005)).
57
Citadel Hldg. Corp. v. Roven, 603 A.2d 818, 824 (Del. 1992).
58
Lorillard Tobacco Co. v. Am. Legacy Found., 903 A.2d 728, 740 (Del. 2006).

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understanding of intent.”59

Pixium SA and Priveterra spar over Sections 5 and 6 of the LOI. In the LOI,

“Company” is Pixium SA.60 The convoluted, relevant language of Section 5, with

Pixium SA inserted and the disputed parenthetical highlighted, reads as follows:

[E]ach of the Parties will pay its own costs and expenses (including legal,
financial advisory, consulting and accounting fees and expenses)
incurred at any time in connection with pursuing or consummating the
Proposed Transaction; provided, that if this LOI is terminated by [Pixium
SA] pursuant to paragraph 6(c) below (provided the Public Entity (or,
prior to assignment of this LOI in accordance with Section 10, Priveterra)
has used commercially reasonable efforts in negotiating definitive
documentation), [Pixium SA] will, subject to a cap of $1.8 million,
reimburse Priveterra or its designee (including the Public Entity) for the
fees, costs and expenses actually and reasonably incurred . . . .

Section 6(c) provides that Pixium SA can terminate the LOI after expiration of the

Exclusionary Period by written notice to the other parties.61 The Exclusivity Period

is the sixty days after Priveterra assigns the LOI.62 There has been neither an

assignment by Priveterra, nor a written termination notice by Pixium SA. Priveterra

argues that Section 5 entitles it to reimbursement before assignment based on the

parenthetical “prior to assignment of this LOI in accordance with Section 10.”63

Not so.

59
City Investing Co. Liquidating Tr. v. Cont’l Cas. Co., 624 A.2d 1191, 1198 (Del. 1993).
60
LOI at 1.
61
Id., § 6.
62
Id., § 5.
63
Id.

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Reading Section 5 in a light most favorable to Priveterra, it allows Priveterra

to recover expenses only if Pixium SA terminates under Section 6(c) (provided that,

prior to assignment, Priveterra used commercially reasonable efforts before

assignment). Thus, for Priveterra to obtain reimbursement:

1. Pixium SA had to terminate pursuant to 6(c); AND

2. the Public Entity used reasonable efforts OR Priveterra used
reasonable efforts before assignment under Section 10.

Priveterra had to use reasonable efforts before the assignment. This is a condition

Priveterra had to satisfy—in addition to—Pixium SA’s termination under section

6(c) to trigger a right to reimbursement.64 Pixium SA still had to terminate the LOI

after the Exclusivity Period and give written notice. Neither occurred. And it’s not

ambiguous what must happen for Priveterra to obtain reimbursement. Even if the

safeguard proceedings satisfied the written-notice requirement, there is still no

assignment to start the Exclusivity Period.

Priveterra suggests the Court should isolate the clause “(or, prior to

assignment of this LOI in accordance with Section 10, Priveterra)”65 and find that

this tends to show that Priveterra could obtain reimbursement without an

64
See ITG Brands, LLC v. Reynolds Am., Inc., 2017 WL 5903355, at *8 (Del. Ch. Nov. 30, 2017)
(interpreting the word “provided” as a proviso that conditions the principal matter that it qualifies).
Here, the term “provided that” in the parenthetical qualifies the reasonable-efforts condition.
65
LOI § 5.

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assignment.66 But Delaware law instructs the Court to give each provision and term

effect; to avoid rendering any part of the contract mere surplusage.67 And a

contract’s single clause or paragraph cannot be read in isolation—it must be read in

context.68 Here, the parenthetical clause merely required Priveterra to use reasonable

efforts if it wanted to obtain a reimbursement in the event was a 6(c) termination.69

One more thing—the LOI isn’t contradictory. Priveterra says it has shown a

contradictory reading since Section 10 allows Priveterra to assign the LOI to the

Public Entity “immediately upon the closing of the direct or indirect acquisition of

the Public Entity.”70 Section 10 doesn’t contradict Section 5; it just provides for

when Priveterra could make the assignment. Again, Priveterra never assigned.

Accordingly, Priveterra has failed to state a breach-of-contract claim since there has

been no breach.71

66
Answer Br. at 8–11.
67
Sunline Commercial Carriers, Inc. v. CITGO Petroleum Corp., 206 A.3d 836, 839 (Del. 2019);
Kuhn Constr., Inc. v. Diamond State Port Corp., 990 A.2d 393, 396–97 (Del. 2010).
68
Stonewall Ins. Co. v. E.I. du Pont de Nemours & Co., 996 A.2d 1254, 1260 (Del. 2010).
69
See SeaWorld Entm’t, Inc. v. Andrews, 2023 WL 3563047, at *5–6 (Del. Ch. May 19, 2023)
(declining to read a parenthetical clause in isolation to create ambiguity in a contract where none
existed).
70
LOI § 10.
71
Because there is no well-pled breach-of-contract claim—the anti-bootstrapping doctrine
argument is inapplicable to Priveterra’s fraud claim. See Levy Family Inv’rs, LLC v. Oars + Alps
LLC, 2022 WL 245543, at *8 (Del. Ch. Jan. 27, 2022) (“Thus, the anti-bootstrapping rule does not
prevent parties from bringing a fraud claim if . . . the breach of contract claim is not well-pled such
that there is no breach claim on which to bootstrap the fraud claim.”) (quotations omitted). With
that, the Court does not discuss the anti-bootstrapping doctrine in its fraud analysis.

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B. PRIVETERRA FAILS TO STATE A CLAIM FOR BREACH OF
THE IMPLIED COVENANT.

It is well-understood that every contract contains an implied covenant of good

faith and fair dealing. The implied covenant requires “‘a party in a contractual

relationship to refrain from arbitrary or unreasonable conduct which has the effect

of preventing the other party to the contract from receiving the fruits’ of the

bargain.”72 “Beyond its gap filling function, the implied covenant applies ‘when a

party to the contract is given discretion to act as to a certain subject and it is argued

that the discretion has been used in a way that is impliedly proscribed by the

contract’s express terms.’”73 “Although contracts often grant wide—if not

unfettered—discretion to one party, ‘the law presumes that parties never accept the

risk that their counterparties will exercise their contractual discretion in bad faith.’”74

Courts will not infer that an obligation exists, that “contradicts a clear exercise

of an express contractual right.”75 Express contractual language is more persuasive

than a party’s actions implementing a contract.76 Courts will infer an obligation

72
Dunlap v. State Farm Fire & Cas. Co., 878 A.2d 434, 442 (Del. 2005) (quoting Wilgus v. Salt
Pond Inv. Co., 498 A.2d 151, 159 (Del. Ch. 1985)).
73
SerVaas v. Ford Smart Mobility LLC, 2021 WL 3779559, at *10 (Del. Ch. Aug. 25, 2021)
(quoting Oxbow Carbon & Mins. Hldgs., Inc. v. Crestview-Oxbow Acq., LLC, 202 A.3d 482, 504
n.93 (Del. 2019)).
74
Id. (quoting Amirsaleh v. Bd. of Trade of City of New York, Inc., 2008 WL 4182998, at *1 (Del.
Ch. Sept. 11, 2008)).
75
Nemec v. Shrader, 991 A.2d 1120, 1127 (Del. 2010).
76
Id. at 1126.

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“when the express terms of the contract indicate that the parties would have agreed

to the obligation had they negotiated the issue, [so] the plaintiff must advance

provisions of the agreement that support this finding in order to allege sufficiently a

specific implied contractual obligation.”77

Our Supreme Court has warned that deploying the implied covenant of good

faith and fair dealing:

Involves a cautious enterprise, inferring contractual terms to handle
developments or contractual gaps that the asserting party pleads neither
party anticipated. One generally cannot base a claim for breach of the
implied covenant on conduct authorized by the agreement. We will
only imply contract terms when the party asserting the implied
covenant proves that the other party has acted arbitrarily or
unreasonably, thereby frustrating the fruits of the bargain that the
asserting party reasonably expected.78

The covenant will not allow mere “post contractual rebalancing of the economic

benefits flowing to the contracting parties.”79 Rather, the covenant applies “only in

that narrow band of cases where the contract as a whole speaks sufficiently to

suggest an obligation and point to a result, but does not speak directly enough to

provide an explicit answer. In the Venn diagram of contract cases, the area of

overlap is quite small.”80

77
Cantor Fitzgerald, L.P. v. Cantor, et al., 1998 WL 842316, at *1 (Del. Ch. Nov. 10, 1998)
(footnote omitted).
78
Nemec, 991 A.2d at 1125–26 (internal citations and quotations omitted).
79
Id. at 1127–28.
80
Airborne Health, Inc. v. Squid Soap, LP, 984 A.2d 126, 146 (Del. Ch. 2009).

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Here, Priveterra claims that the Defendants breached the implied covenant of

good faith and fair dealing by rejecting Priveterra’s offer to supply funding and

entering safeguard proceedings.81 But Priveterra doesn’t point to an implied,

breached obligation. Instead, Priveterra vaguely suggests that the Defendants

breached the good-faith covenant by entering into safeguard proceedings when there

were other options on the table.82 That’s not enough.

General allegations of bad-faith conduct are insufficient to state a breach of

the implied covenant of good faith and fair dealing.83 And the duty of good faith

and fair dealing isn’t an equitable remedy for rebalancing economic interests after

events that could have been anticipated but were not.84

Recall, the parties had crafted a specific LOI provision with set conditions to

allow for the type of reimbursement now sought. Priveterra knew that the

Defendants were in talks with creditors and that the Proposed Transaction could have

gone belly-up. Faced with this, Priveterra doesn’t identify an unanticipated gap for

the implied covenant of good faith and fair dealing to fill.85 Accordingly, Priveterra

81
Compl., ¶ 54.
82
See Compl., ¶¶ 53–55.
83
Kuroda v. SPJS Holdings, L.L.C., 971 A.2d 872, 888 (Del. Ch. 2009).
84
Lonergan v. EPE Holdings, LLC, 5 A.3d 1008, 1019 (Del. Ch. 2010).
85
Wal-Mart Stores, Inc. v. AIG Life Ins. Co., 901 A.2d 106, 116 (Del. 2006) (“Nor has Wal-Mart
identified any implied contract term that it would have the trial court read into the contract.
Accordingly, this count fails to state a claim upon which relief may be granted.”).

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has failed to state a claim for breach of the implied covenant of good faith and fair

dealing.

C. PRIVETERRA’S FRAUDULENT INDUCEMENT CLAIM FAILS.

Fraud consists of the following elements:

(1) a false representation, usually one of fact, made by the defendant;
(2) the defendant’s knowledge or belief that the representation was
false, or was made with reckless indifference to the truth; (3) an intent
to induce the plaintiff to act or to refrain from acting; (4) the plaintiff’s
action or inaction taken in justifiable reliance upon the representation;
and (5) damage to the plaintiff as a result of such reliance.86

There is no elemental difference between fraud and fraud in the inducement.87

In the norm, optimistic statements extolling one’s own skills, experience, and

resources are mere puffery that cannot form the basis of a fraud claim.88 And

fraudulent inducement generally requires a misrepresentation of present facts rather

than a statement of future intent.89

What’s more, to state a claim for fraud, a complainant must plead its elements

with particularity as required by Rule 9(b).90 But the state of mind and knowledge

86
Stephenson v. Capano Dev., Inc., 462 A.2d 1069, 1074 (Del. 1983) (cleaned up).
87
Trifecta Multimedia Holdings Inc. v. WCG Clinical Servs. LLC, 318 A.3d 450, 463 n.34 (Del.
Ch. 2024).
88
Id. at 463 (citing Solow v. Aspect Res., LLC, 2004 WL 2694916, at *3 (Del. Ch. Oct. 19, 2004)).
89
Cercacor Labs., Inc. v. Metronom Health, Inc., 2025 WL 1180186, at *9 (Del. Super. Ct. Apr.
23, 2025).
90
Surf’s Up Legacy P’rs, LLC v. Virgin Fest, LLC, 2021 WL 117036, at *12 (Del. Super. Ct.
Jan. 13, 2021) (“The claimant must allege: (1) the time, place, and contents of the false
representation, (2) the identity of the person making the representation; and (3) what the person
intended to gain by making the representation. When the necessary facts are within the opposing
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elements of a fraud claim can be alleged more generally because any attempt to

require specificity in pleading a condition of mind would be unworkable and

undesirable.91

Here, Priveterra avers that Mr. Diamond intimated that negotiations with

creditors were well underway and these negotiations would allow the Defendants to

stay solvent.92 At the same time, according to Priveterra, Mr. Diamond and the

Defendants knew that they could likely be insolvent by September 2023.93

Priveterra’s fraud claim fails here because there was no false representation—

all agree the Pixium entities were in negotiations with creditors and seemed hopeful

of the outcome.94 The fact that the Pixium parties could likely run out of money in

party’s control, however, less particularity is required.” (cleaned up)).
91
Abry P’rs V, L.P. v. F&W Acq. LLC, 891 A.2d 1032, 1050 (Del. Ch. 2006) (quoting Desert
Equities, Inc. v. Morgan Stanley Leveraged Equity Fund, II, L.P., 624 A.2d 1199, 1208 (Del.
1993)).
92
Compl., ¶ 58.
93
Id.
94
See Hr’g Tr. at 45–46:
The Court: Your friend said that you have all but conceded that the defendants
were, in fact, in negotiations with their creditors. Do you agree with
that?
Plaintiff’s
Counsel: We do agree that—well as far as we know, Your Honor, they were
in negotiations. As Your Honor is aware, we don’t have discovery.
We haven’t been afforded the opportunity to understand that
exactly. However, even if they were in negotiations, the fact that he
was—that Mr. Diamond was recounting specifics, was recounting
false specifics of those negotiations, that is the false statement . . . .

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September 2023 is undoubtedly why the negotiations were occurring in the first

place. Priveterra doesn’t allege in its complaint that these negotiations never

happened or that the Pixium parties had no intention on obtaining financing.

To the extent that Priveterra argues that there were specific misrepresentations

made by Mr. Diamond concerning the creditors, and discovery will reveal these

misrepresentations, the Complaint is devoid of any specific details about what these

misstatements are.95 So Rule 9 isn’t satisfied; there is no information about the

contents of those alleged false statements made—something Priveterra clearly has

without discovery—in Priveterra’s complaint.96 Discovery isn’t a crutch for

plaintiffs to lean on as support of an ill-pled fraud claim that lacks the minimal

specifics.97 Priveterra hasn’t alleged an actual false misrepresentation to ground its

fraud claim. Thus, that claim, too, must be dismissed.

95
See id.
96
See Valley Joist BD Holdings, LLC v. EBSCO Indus., Inc., 269 A.3d 984, 988 (Del. 2021)
(“The factual circumstances that must be stated with particularity refer to the time, place, and
contents of the false representations; the facts misrepresented; the identity of the person(s) making
the misrepresentation; and what that person(s) gained from making the misrepresentation.”).
97
See Airborne Health, 984 A.2d at 142 (“[T]he plaintiff should be able to say when he was lied
to, or what specifically was said to him that was materially misleading by omission. The lack of
prior discovery poses no impediment to a plaintiff’s ability to plead ‘the circumstances constituting
fraud.’ After all, the plaintiff was there.”); Crescent/Mach I Partners, L.P. v. Turner, 846 A.2d
963, 988 (Del. Ch. 2000) (“Moreover, plaintiffs’ suggestion that their allegations cannot be fully
articulated in the absence of discovery belies the fraud-based pleading standard. I know of no
Delaware precedent that permits a conclusory allegation to proceed on the basis that later discovery
will fill in the purported gaps if only the pleading is allowed to survive a motion to dismiss.”).

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V. CONCLUSION

Priveterra relies heavily on the reasonable conceivability standard the Court

employs at the motion-to-dismiss stage. But that standard is applied to causes of

action that are buttressed by sufficient and well-pled factual allegations98 and

reasonable reads of operative agreements.99 In this instance, Priveterra has failed to

plead a base of facts that allow it to recover under any reasonably conceivable set of

circumstances and its attempt to insert language or conditions into the LOI cannot

be countenanced.

The Court, therefore, GRANTS the Defendants’ Motions to Dismiss as to all

three of Priveterra’s counts in its Complaint.

IT IS SO ORDERED.

/s/ Paul R. Wallace
______________________________
Paul R. Wallace, Judge

98
See Dollard v. Callery, 185 A.3d 694, 703 (Del. Super. Ct. 2018) (“Delaware’s pleading
standard under a 12(b)(6) motion to dismiss is minimal, but not meaningless.”); see also IMO
the LW & T of Hurley, 2014 WL 1088913, at *1 (Del. Ch. Mar. 20, 2014) (“Although
Delaware’s ‘reasonable conceivability’ pleading standard is minimal, it is not meaningless,
and it does not excuse a plaintiff from alleging sufficient factual allegations that, if proven,
would entitle the plaintiff to relief.”).
99
See Intermec IP Corp. v. TransCore, LP, 2021 WL 3620435, at *9 (Del. Super. Ct. Aug.
16, 2021) (“As a question of law, a contract’s proper interpretation can be resolved on a
pleadings-stage . . . [and] to succeed, the movant’s interpretation must be the only reasonable
construction as a matter of law.”)(cleaned up).

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