Gallagher
MONTH-IN-BRIEF (Jun 2026)
Court of Chancery Interprets Delaware APA’s Forum Selection Clause Containing Both Mandatory and Permissive Language
By Lisa R. Stark, Hirschler Fleischer
In a recent decision, Kelly Roofing Holdings, LLC v. Flores, C.A. No. 2025-1049-BWD (Del. Ch. June 4, 2026), the Court of Chancery enforced a Delaware forum selection provision contained in an asset purchase agreement, finding the forum selection clause to be mandatory rather than permissive. The forum selection clause stated that an action arising out of the asset purchase agreement or the transactions contemplated thereby “may be instituted” in a Delaware federal or state court, and each party “irrevocably submits to the exclusive jurisdiction of such courts in any such” action.
On January 15, 2025, plaintiffs entered into an Asset Purchase Agreement (“APA”) under which defendants agreed to sell to plaintiffs the assets of Integrity Roofing and Gutters, Inc., a Florida corporation that repairs roofs and gutters for commercial and residential buildings. After executing the APA, plaintiffs allegedly discovered that defendants failed to disclose material liabilities, litigation, contracts and a fraudulent invoicing, bribery, and kickback scheme. At the same time as entering into the APA, plaintiffs entered into an employment agreement with defendant Chantelle A. Flores to govern the terms of Flores’s employment as president of the acquired business after the transaction. Thereafter, plaintiffs sued individual defendant Flores under the employment agreement in Florida and then brought this action in Delaware for, among other things, fraudulent inducement with respect to the APA.
