IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
CA, INC.,
Plaintiff,
v.
RICHARD S. CORDREY, in his capacity as the Delaware Secretary of Finance and the Delaware State Escheator; PATRICK T. CARTER, in his capacity as the Director of the Division of Revenue, and the DEPARTMENT OF FINANCE, DIVISION OF REVENUE FOR THE STATE OF DELAWARE,
Defendants.
:::::::::::::::
C.A. No. 4111-CC
DEFENDANTS' ANSWER
AND AFFIRMATIVE DEFENSES
Defendants Richard S. Cordrey, in his capacity as the Delaware Secretary
of Finance and the Delaware State Escheator, Patrick T. Carter, in his capacity as the
Director of the Division of Revenue, and the Department of Finance, Division of
Revenue for the State of Delaware (collectively, "the State"), by and through their
undersigned counsel, respond to the allegations of the First Amended Verified Complaint
for Equitable, Declaratory, Injunctive, and Other Relief (the "Amended Complaint") as
follows:
1. The State denies the allegations contained in sentence 1 of
paragraph 1 of the Amended Complaint, except admits that CA, Inc. ("CA") purports to
be bringing an action against the State raising the issues referenced in sentence 1. The
State also denies the allegations contained in sentence 2 of paragraph 1 of the Amended
EFiled: Jan 12 2009 5:45PM EST Transaction ID 23272352 Case No. 4111-CC
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Complaint, except admits that the State has exercised its statutory right to assess interest
and audit CA. 12 Del. C. § 1159(d); 12 Del. C. § 1155. Additionally, the State denies
the allegations contained in sentences 3 and 4 of paragraph 1 of the Amended Complaint
on the ground that they contain conclusions of law to which no response is required. To
the extent the allegations are not conclusions of law, the State denies the allegations
contained in sentences 3 and 4 of paragraph 1 of the Amended Complaint.
2. Admitted.
3. Admitted.
4. Admitted.
5. Admitted.
6. Admitted.
7. The State denies the allegations contained in paragraph 7 of the
Amended Complaint on the ground that they contain conclusions of law to which no
response is required. To the extent a response is required, the State denies the allegations
contained in paragraph 7 of the Amended Complaint because the Court lacks subject
matter jurisdiction over CA's claims.
8. The State denies the allegations contained in paragraph 8 of the
Amended Complaint on the ground that they contain conclusions of law to which no
response is required. To the extent a response is required, the State denies the allegations
contained in paragraph 8 of the Amended Complaint because the Court lacks subject
matter jurisdiction over CA's claims.
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9. The State denies the allegations contained in paragraph 9 of the
Amended Complaint, except admits that the State oversees and regulates the reporting
and processing of unclaimed and abandoned property owed to the State, including
pursuant to Delaware's Abandoned or Unclaimed Property Law, 12 Del. C. §§ 1101-1224
("Abandoned Property Law").
10. Admitted.
11. The State denies the allegations contained in paragraph 11 of the
Amended Complaint, except admits that Delaware has a Voluntary Disclosure Program
(the "VDA Program"), and respectfully refers the Court to the Division of Revenue's
Regulations (the "Regulations") for a complete and accurate description of the State's
VDA Program.
12. The State denies the allegations contained in paragraph 12 of the
Amended Complaint, and respectfully refers the Court to the Regulations for a complete
and accurate description of the State's VDA Program.
13. The State denies the allegations contained in sentence 1 of
paragraph 13 of the Amended Complaint. The State also denies the allegations contained
in sentences 2 and 3 of paragraph 13 of the Amended Complaint, except admits that Form
AP DE-1, Disclosure and Notice of Intent to Voluntarily Comply with Abandoned
Property Law (the "Notice of Intent"), and Form AP DE-2, Voluntary Self Disclosure
Agreement (the "VDA Agreement") are form documents that may be used in connection
with the VDA Program. The State respectfully refers the Court to the Notice of Intent
and the VDA Agreement for a complete and accurate description of their contents. The
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State denies the allegations contained in sentence 4 of paragraph 13 of the Amended
Complaint.
14. The State denies the allegations contained in paragraph 14 of the
Amended Complaint, except admits that on November 17, 2004, CA faxed to the State a
signed Notice of Intent, dated November 8, 2004, admitting that it had not complied with
the Abandoned Property Law for a period of at least thirteen years.
15. The State denies the allegations contained in paragraph 15 of the
Amended Complaint, except admits that on November 17, 2004, CA faxed to the State a
signed Notice of Intent, dated November 8, 2004, where CA admitted that it had not
complied with the Abandoned Property Law for a period of at least thirteen years. The
State respectfully refers the Court to the document referred to in paragraph 15 of the
Amended Complaint for a complete and accurate description of its contents.
16. The State denies the allegations contained in paragraph 16 of the
Amended Complaint, except admits that the Notice of Intent imposes certain
requirements on a holder, and respectfully refers the Court to the document referred to in
paragraph 16 of the Amended Complaint for a complete and accurate description of its
contents.
17. Denied.
18. Denied.
19. The State denies the allegations contained in paragraph 19 of the
Amended Complaint, and respectfully refers the Court to the Form AP DE-2 referred to
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in paragraph 19 of the Amended Complaint for a complete and accurate description of its
contents.
20. The State denies the allegations contained in paragraph 20 of the
Amended Complaint, and respectfully refers the Court to the Regulations and the
documents referred to in paragraph 20 of the Amended Complaint for a complete and
accurate description of their contents.
21. Denied.
22. The State lacks the knowledge or information sufficient to form a
belief as to the truth of the allegations contained in paragraph 22 of the Amended
Complaint and denies them on that basis, except admits that CA retained Abandoned
Property Services LLC to conduct CA's self-audit.
23. The State lacks the knowledge or information sufficient to form a
belief as to the truth of the allegations contained in paragraph 23 of the Amended
Complaint and denies them on that basis.
24. The State lacks the knowledge or information sufficient to form a
belief as to the truth of the allegations contained in paragraph 24 of the Amended
Complaint and denies them on that basis.
25. The State denies the allegations contained in paragraph 25 of the
Amended Complaint, except admits that on May 16, 2005, CA requested additional time
to complete its self-audit, which the State provided with the understanding that the matter
would be resolved promptly.
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26. The State denies the allegations contained in paragraph 26 of the
Amended Complaint, except admits that on July 28, 2005, APS met with the State to
identify the amount that CA claimed it owed the State for the more than thirteen years it
violated the Abandoned Property Law.
27. The State denies the allegations contained in paragraph 27 of the
Amended Complaint, except admits that the State requested additional information and/or
materials from CA, and that CA did not comply with that request.
28. Denied.
29. The State denies the allegations contained in paragraph 29 of the
Amended Complaint, except admits that the State's Audit Manager, as well as other State
personnel, reviewed CA's submissions.
30. The State denies the allegations contained in paragraph 30 of the
Amended Complaint, and respectfully refers the Court to the April 18, 2006,
correspondence sent by the State to CA that is referred to in paragraph 30 of the
Amended Complaint for a complete and accurate description of its contents.
31. The State denies the allegations contained in paragraph 31 of the
Amended Complaint, except admits that on August 7, 2007, CA sent the State a revised
liability amount of $2,323,880.08, an increase of $1,639,844.14 over its original July
2005 report of liability.
32. The State denies the allegations contained in paragraph 32 of the
Amended Complaint, except admits that on August 7, 2007, CA sent the State a revised
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liability amount of $2,323,880.08, an increase of $1,639,844.14 over its original July
2005 report of liability.
33. The State denies the allegations contained in paragraph 33 of the
Amended Complaint, except admits that the State continued to request additional
information from CA concerning, among other things, CA's accounts receivable and
acquisitions, which CA had not provided to the State.
34. Denied.
35. The State denies the allegations contained in paragraph 35 of the
Amended Complaint, and respectfully refers the Court to the documents referred to in
paragraph 35 of the Amended Complaint for a complete and accurate description of their
contents.
36. The State denies the allegations contained in paragraph 36 of the
Amended Complaint, and respectfully refers the Court to the document referred to in
paragraph 36 of the Amended Complaint for a complete and accurate description of its
contents.
37. The State denies the allegations contained in paragraph 37 of the
Amended Complaint, except admits that the State had not yet issued a formal request for
payment or a formal request for an audit review, and respectfully refers the Court to the
Regulations and the documents referred to in paragraph 37 for a complete and accurate
description of their contents.
38. The State denies the allegations contained in paragraph 38 of the
Amended Complaint, and respectfully refers the Court to the documents referred to in
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paragraph 38 of the Amended Complaint for a complete and accurate description of their
contents.
39. The State denies the allegations contained in paragraph 39 of the
Amended Complaint, and respectfully refers the Court to the document referred to in
paragraph 39 of the Amended Complaint for a complete and accurate description of its
contents.
40. The State denies the allegations contained in paragraph 40 of the
Amended Complaint, and respectfully refers the Court to the documents referred to in
paragraph 40 of the Amended Complaint for a complete and accurate description of their
contents.
41. The State denies the allegations contained in paragraph 41 of the
Amended Complaint on the ground that it lacks the knowledge or information sufficient
to form a belief as to the truth of the allegations and denies them on that basis, except
admits that CA purports to dispute the State's use of estimates in the calculation of CA's
abandoned property liability.
42. Denied.
43. The State denies the allegations contained in paragraph 43 of the
Amended Complaint on the ground that they contain conclusions of law to which no
response is required. To the extent a response is required, the allegations are denied.
Moreover, the State lacks the knowledge or information sufficient to form a belief as to
the truth of the allegation about "the remaining amounts" referenced in paragraph 43 of
the Amended Complaint, and further denies that allegation on that basis.
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44. Denied.
45. The State denies the allegations contained in paragraph 45 of the
Amended Complaint, except admits that CA has refused to pay the abandoned property it
owes to the State.
46. The State denies the allegations contained in paragraph 46 of the
Amended Complaint, except admits that on June 3, 2008, the State made a formal request
to CA for payment of $6,794,539.20 in past-due liability and $1,423,880.26 in interest
accrued as of that date, for a total of $8,218,410.46. The State respectfully refers the
Court to the document referred to in paragraph 46 of the Amended Complaint for a
complete and accurate description of its contents.
47. The State denies the allegations contained in paragraph 47 of the
Amended Complaint, and respectfully refers the Court to the communication referenced
in that paragraph for a complete and accurate description of its contents.
48. The State denies the allegations contained in paragraph 48 of the
Amended Complaint, except admits that the State calculated the amount CA owes to the
State based on its review of the information provided to the State by APS on CA's behalf.
49. The State denies the allegations contained in paragraph 49 of the
Amended Complaint, except admits that the State had not yet issued a formal request for
an audit review at this time.
50. The State denies the allegations contained in paragraph 50 of the
Amended Complaint, except admits that the State's June 3, 2008 letter included a formal
request for $1,423,880.26 in interest pursuant to 12 Del. C. § 1159(d). The State
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respectfully refers the Court to the document referred to in paragraph 50 of the Amended
Complaint for a complete and accurate description of its contents.
51. The State denies the allegations contained in paragraph 51 of the
Amended Complaint, except admits that the State's June 3, 2008 letter does not expressly
cite to the Regulations, and respectfully refers the Court to the Regulations and the
document referred to in paragraph 51 of the Amended Complaint for a complete and
accurate description of their contents.
52. The State denies the allegations contained in paragraph 52 of the
Amended Complaint, and respectfully refers the Court to the document referred to in
paragraph 52 of the Amended Complaint for a complete and accurate description of its
contents.
53. The State denies the allegations contained in paragraph 53 of the
Amended Complaint, except admits that the State's June 3, 2008 letter does not expressly
cite to the Regulations, and respectfully refers the Court to the Regulations and the
document referred to in paragraph 53 of the Amended Complaint for a complete and
accurate description of their contents.
54. The State denies the allegations contained in paragraph 54 of the
Amended Complaint, except admits that the State did not request additional information
from CA in the referenced correspondence, and respectfully refers the Court to the
document referred to in paragraph 54 of the Amended Complaint for a complete and
accurate description of its contents.
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55. The State denies the allegations contained in paragraph 55 of the
Amended Complaint, except admits that the State did not request additional information
from CA in the referenced correspondence, and respectfully refers the Court to the
document referred to in paragraph 55 of the Amended Complaint for a complete and
accurate description of its contents.
56. The State denies the allegations contained in paragraph 56 of the
Amended Complaint, except admits that on June 26, 2008, CA sent a letter purporting to
dispute the State's formal request for payment, and refusing to make payment of the
amount requested by the State. The State respectfully refers the Court to the document
referred to in paragraph 56 of the Amended Complaint for a complete and accurate
description of its contents.
57. The State denies the allegations contained in paragraph 57 of the
Amended Complaint, and respectfully refers the Court to the document referred to in
paragraph 57 of the Amended Complaint for a complete and accurate description of its
contents.
58. Denied.
59. Denied.
60. Denied.
61. The State denies the allegations contained in paragraph 61 of the
Amended Complaint, except admits that CA has failed to make payment to the State in
compliance with the Abandoned Property Law.
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62. The State denies the allegations contained in paragraph 62 of the
Amended Complaint, except admits that it exercised its statutory right to formally request
an audit of CA pursuant to 12 Del. C. § 1155. The State respectfully refers the Court to
the document referred to in paragraph 62 of the Amended Complaint for a complete and
accurate description of its contents.
63. The State denies the allegations contained in paragraph 63 of the
Amended Complaint, and respectfully refers the Court to the document referred to in
paragraph 63 of the Amended Complaint for a complete and accurate description of its
contents.
64. The State denies the allegations contained in paragraph 64 of the
Amended Complaint, and respectfully refers the Court to the Regulations and the
document referred to in paragraph 64 of the Amended Complaint for a complete and
accurate description of their contents.
65. Denied.
66. Denied.
67. Denied.
68. The State lacks the knowledge or information sufficient to form a
belief as to the truth of the allegations contained in paragraph 68 of the Amended
Complaint and denies them on that basis. To the extent a response is required, the State
denies the allegations contained in paragraph 68 of the Amended Complaint.
69. The State lacks the knowledge or information sufficient to form a
belief as to the truth of the allegations contained in paragraph 69 of the Amended
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Complaint and denies them on that basis. To the extent a response is required, the State
denies the allegations contained in paragraph 69 of the Amended Complaint.
70. The State lacks the knowledge or information sufficient to form a
belief as to the truth of the allegations contained in paragraph 70 of the Amended
Complaint and denies them on that basis. To the extent a response is required, the State
denies the allegations contained in paragraph 70 of the Amended Complaint.
71. The State lacks the knowledge or information sufficient to form a
belief as to the truth of the allegations contained in paragraph 71 of the Amended
Complaint and denies them on that basis. To the extent a response is required, the State
denies the allegations contained in paragraph 71 of the Amended Complaint.
72. The State lacks the knowledge or information sufficient to form a
belief as to the truth of the allegations contained in paragraph 72 of the Amended
Complaint and denies them on that basis. To the extent a response is required, the State
denies the allegations contained in paragraph 72 of the Amended Complaint.
73. Denied.
74. The State denies the allegations contained in paragraph 74 of the
Amended Complaint, except admits that the State has not accepted the conditional
payment offered by CA, which is substantially less than the amount determined by the
State that CA owes, and that the State exercised its statutory authority pursuant to 12 Del.
C. § 1159(d) to assess interest.
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75. The State denies the allegations contained in paragraph 75 of the
Amended Complaint, except admits that a VDA Agreement was never executed by either
CA or the State.
76. Denied.
77. Denied.
78. Denied.
79. Denied.
80. The State denies the allegations contained in paragraph 80 of the
Amended Complaint, except admits that on June 3, 2008, the State made a formal request
to CA for payment of $6,794,539.20 in past-due liability and $1,423,880.26 in interest
accrued as of that date, for a total of $8,218,410.46. The State respectfully refers the
Court to the document referred to in paragraph 80 of the Amended Complaint for a
complete and accurate description of its contents.
81. The State denies the allegations contained in paragraph 81 of the
Amended Complaint, except admits that on June 26, 2008, CA sent a letter disputing the
State's formal request for payment, and claiming that it owed $3,585,978 for all
abandoned property liability for the periods 1991-2001. The State respectfully refers the
Court to the document referred to in paragraph 81 of the Amended Complaint for a
complete and accurate description of its contents.
82. The State denies the allegations contained in paragraph 82 of the
Amended Complaint, except admits that there is a difference of $4,632,432.46 between
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the State's June 3, 2008 request for payment (inclusive of interest) and the amount CA
claims it owes.
83. The State denies the allegations contained in paragraph 83 of the
Amended Complaint on the ground that they contain conclusions of law to which no
response is required.
84. The State denies the allegations contained in paragraph 84 of the
Amended Complaint on the ground that they contain conclusions of law to which no
response is required.
85. Denied.
86. The State denies the allegations in paragraph 86 of the Amended
Complaint on the ground that they contain conclusions of law to which no response is
required.
87. The State denies the allegations contained in paragraph 87 of the
Amended Complaint on the ground that they contain conclusions of law to which no
response is required. To the extent the allegations are not conclusions of law, the State
denies the allegations contained in paragraph 87 of the Amended Complaint.
88. The State denies the allegations contained in paragraph 88 of the
Amended Complaint on the ground that they contain conclusions of law to which no
response is required. To the extent the allegations are not conclusions of law, the State
denies the allegations contained in paragraph 88 of the Amended Complaint.
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COUNT I
Statutory Cause of Action – 12 Del. C. § 1156(b)
89. The State reasserts and incorporates by reference herein all
responses to the preceding paragraphs.
90. The State denies the allegations contained in paragraph 90 of the
Amended Complaint on the ground that they contain conclusions of law to which no
response is required. The State respectfully refers the Court to 12 Del. C. § 1156(b) for a
complete and accurate description of its contents.
91. Denied.
92. Denied.
93. Denied.
94. The State denies the allegations contained in paragraph 94 of the
Amended Complaint, except admits that it exercised its statutory right under 12 Del. C.
§ 1159(d) to assess interest.
95. Denied.
96. Denied.
97. Denied.
COUNT II
Declaratory Relief Pursuant to 10 Del. C. § 6501 et seq.
98. The State reasserts and incorporates by reference herein all
responses to the preceding paragraphs.
99. Denied.
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100. Denied.
101. Denied.
102. Denied.
103. Denied.
104. Denied.
105. Denied.
106. Denied.
107. Denied.
108. Denied.
109. Denied.
110. Denied.
111. Denied.
112. The State denies the allegations contained in paragraph 112 of the
Amended Complaint, and CA's request for relief should be denied.
113. The State denies the allegations contained in paragraph 113 of the
Amended Complaint, and the subparts thereof, and CA's request for relief should be
denied.
COUNT III
Injunctive Relief
114. The State reasserts and incorporates by reference herein all
responses to the preceding paragraphs.
115. Denied.
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116. Denied.
117. Denied.
118. The State denies the allegations contained in paragraph 118 of the
Amended Complaint, and respectfully refers the Court to the Regulations for a complete
and accurate description of the State's VDA Program.
119. Denied.
120. Denied.
121. The State denies the allegations contained in paragraph 121 of the
Amended Complaint, except admits that the State concluded its review of the information
provided by CA, and, based on that information, determined that CA understated its
liability and owes a substantially larger amount to the State.
122. Denied.
123. Denied.
124. Denied.
125. Denied.
126. The State lacks the knowledge or information sufficient to form a
belief as to the truth of the allegations contained in paragraph 126 of the Amended
Complaint and denies them on that basis. To the extent a response is required, the State
denies the allegations contained in paragraph 126 of the Amended Complaint.
127. The State denies the allegations contained in paragraph 127 of the
Amended Complaint on the ground that they contain conclusions of law to which no
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response is required. To the extent a response is required, the State denies the allegations
contained in paragraph 127, and CA's request for relief should be denied.
128. Denied.
129. The State denies the allegations contained in paragraph 129 of the
Amended Complaint, and CA's request for relief should be denied.
COUNT IV
Specific Performance
130. The State reasserts and incorporates by reference herein all
responses to the preceding paragraphs.
131. Denied.
132. The State denies the allegations contained in paragraph 132 of the
Amended Complaint, and respectfully refers the Court to the Regulations and the
documents referred to in paragraph 132 of the Amended Complaint for a complete and
accurate description of their contents.
133. The State denies the allegations contained in paragraph 133 of the
Amended Complaint, except admits that the Notice of Intent imposes certain
requirements on a holder, and respectfully refers the Court to the Regulations and the
documents referred to in paragraph 133 of the Amended Complaint for a complete and
accurate description of their contents.
134. The State denies the allegations contained in paragraph 134 of the
Amended Complaint, and respectfully refers the Court to the Regulations and the
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documents referred to in paragraph 134 of the Amended Complaint for a complete and
accurate description of their contents.
135. The State denies the allegations contained in paragraph 135 of the
Amended Complaint, except admits that CA retained an outside auditor, provided a
limited number of documents to the State regarding the self-audit, continually changed its
estimates of the amount owed to the State, and never paid the State the money it owes for
the more than thirteen years it violated the Abandoned Property Law.
136. Denied.
137. The State denies the allegations contained in paragraph 137 of the
Amended Complaint, and CA's request for relief should be denied.
138. Denied.
COUNT V
Promissory Estoppel
139. The State reasserts and incorporates by reference herein all
responses to the preceding paragraphs.
140. Denied.
141. Denied.
142. Denied.
143. Denied.
144. Denied.
145. The State denies the allegations contained in paragraph 145 of the
Amended Complaint, and CA's request for relief should be denied.
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COUNT VI
Breach of Agreement
146. The State reasserts and incorporates by reference herein all
responses to the preceding paragraphs.
147. Denied.
148. Denied.
149. The State denies the allegations contained in paragraph 149 of the
Amended Complaint, except admits that the Notice of Intent imposes certain
requirements on a holder, and respectfully refers the Court to the Regulations and the
documents referred to in paragraph 149 of the Amended Complaint for a complete and
accurate description of their contents.
150. The State denies the allegations contained in paragraph 150 of the
Amended Complaint, and respectfully refers the Court to the Regulations and the
documents referred to in paragraph 150 of the Amended Complaint for a complete and
accurate description of their contents.
151. Denied.
152. Denied.
153. Denied.
COUNT VII
Breach of Agreement Through Breach of the Implied Covenant of Good Faith and Fair Dealing
154. The State reasserts and incorporates by reference herein all
responses to the preceding paragraphs.
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155. Denied.
156. The State denies the allegations contained in paragraph 156 of the
Amended Complaint on the ground that they contain conclusions of law to which no
response is required. To the extent a response is required, the State denies the allegations,
and respectfully refers the Court to the Regulations and the documents referred to in
paragraph 156 of the Amended Complaint for a complete and accurate description of
their contents.
157. Denied.
158. Denied.
COUNT VIII
Declaratory Judgment – Unconstitutionality of 29 Del. C. § 10161 and Title 12,Chapter 11 of the Delaware Code as to Individual Defendants
159. The State reasserts and incorporates by reference herein all
responses to the preceding paragraphs.
160. The State denies the allegations contained in paragraph 160 of the
Amended Complaint on the ground that the State's attempt to collect abandoned property
from CA pursuant to the Abandoned Property Law does not deprive CA of due process of
law.
161. The State denies the allegations contained in paragraph 161 of the
Amended Complaint on the ground that the State's attempt to collect abandoned property
from CA pursuant to the Abandoned Property Law does not deprive CA of due process of
law.
162. Denied.
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163. Denied.
164. The State denies the allegations contained in paragraph 164 of the
Amended Complaint on the ground that the State's attempt to collect abandoned property
from CA pursuant to the Abandoned Property Law does not deprive CA of due process of
law.
165. The State denies the allegations contained in paragraph 165 of the
Amended Complaint on the ground that the State's attempt to collect abandoned property
from CA pursuant to the Abandoned Property Law does not deprive CA of due process of
law.
166. Denied.
167. Denied.
168. Denied.
169. Denied.
170. Denied.
171. Denied.
172. Denied.
173. The State denies the allegations contained in paragraph 173 of the
Amended Complaint on the ground that they contain conclusions of law to which no
response is required. To the extent an answer is required, the State denies the allegation
that the State has waived sovereign immunity.
174. The State denies the allegations contained in paragraph 174 of the
Amended Complaint on the ground that the State's attempt to collect abandoned property
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from CA pursuant to the Abandoned Property Law does not deprive CA of due process of
law, and CA's request for relief should be denied.
COUNT IX
Injunctive Relief – Unconstitutionality of 29 Del. C. § 10161 and Title 12,Chapter 11 of the Delaware Code as to Individual Defendants
175. The State reasserts and incorporates by reference herein all
responses to the preceding paragraphs.
176. The State denies the allegations contained in paragraph 176 of the
Amended Complaint on the ground that the State's attempt to collect abandoned property
from CA pursuant to the Abandoned Property Law does not deprive CA of due process of
law.
177. The State denies the allegations contained in paragraph 177 of the
Amended Complaint on the ground that the State's attempt to collect abandoned property
from CA pursuant to the Abandoned Property Law does not deprive CA of due process of
law.
178. Denied.
179. Denied.
180. The State denies the allegations contained in paragraph 180 of the
Amended Complaint on the ground that the State's attempt to collect abandoned property
from CA pursuant to the Abandoned Property Law does not deprive CA of due process of
law.
181. The State denies the allegations contained in paragraph 181 of the
Amended Complaint on the ground that the State's attempt to collect abandoned property
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from CA pursuant to the Abandoned Property Law does not deprive CA of due process of
law.
182. Denied.
183. Denied.
184. The State denies the allegations contained in paragraph 184 of the
Amended Complaint on the ground that the State's attempt to collect abandoned property
from CA pursuant to the Abandoned Property Law does not deprive CA of due process of
law.
185. Denied.
186. The State lacks the knowledge or information sufficient to form a
belief as to the truth of the allegations contained in paragraph 186 of the Amended
Complaint and denies them on that basis. To the extent a response is required, the State
denies the allegations contained in paragraph 186 of the Amended Complaint.
187. The State denies the allegations contained in paragraph 187 of the
Amended Complaint on the ground that they contain conclusions of law to which no
response is required. To the extent a response is required, the State denies the allegations
contained in paragraph 187, and CA's request for relief should be denied.
188. The State denies the allegations contained in paragraph 188 of the
Amended Complaint, and CA's request for relief should be denied.
189. The State denies the allegations contained in paragraph 189 of the
Amended Complaint, and CA's request for relief should be denied.
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26
AFFIRMATIVE DEFENSES
FIRST AFFIRMATIVE DEFENSE
CA's claims are barred by the doctrine of sovereign immunity.
SECOND AFFIRMATIVE DEFENSE
The Court of Chancery lacks subject matter jurisdiction.
THIRD AFFIRMATIVE DEFENSE
The Plaintiff lacks standing to pursue its claims.
FOURTH AFFIRMATIVE DEFENSE
The Amended Complaint fails to state a claim upon which relief can be
granted.
FIFTH AFFIRMATIVE DEFENSE
CA has violated Delaware's Abandoned Property Law, including 12 Del.
C. §§ 1101-1224.
SIXTH AFFIRMATIVE DEFENSE
CA's refusal to comply with Delaware law was the cause of injury, loss, or
damage complained of by CA.
SEVENTH AFFIRMATIVE DEFENSE
CA's claims are barred by the doctrine of unclean hands.
EIGHTH AFFIRMATIVE DEFENSE
Some or all of CA's equitable claims, including estoppel, and equitable
defenses may not be asserted against the State.
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27
NINTH AFFIRMATIVE DEFENSE
CA is not entitled to the relief requested in the Amended Complaint.
TENTH AFFIRMATIVE DEFENSE
The Amended Complaint is redundant and should be dismissed because it
duplicates the allegations made as a counterclaim in the State's Action entitled Cordrey v.
CA, Inc., C.A. No. 4195-CC, creating unnecessary burden and cost for the parties and the
Court.
ELEVENTH AFFIRMATIVE DEFENSE
CA has not been denied due process of law.
TWELFTH AFFIRMATIVE DEFENSE
The State affirmatively raises and reserves all applicable equitable
defenses.
THIRTEENTH AFFIRMATIVE DEFENSE
At this time, the Amended Complaint does not describe the claims made
against the State with sufficient particularity to allow the State to determine all the
defenses, and the State therefore lacks sufficient knowledge to form a belief as to the
existence and availability of additional affirmative defenses. The State reserves the right
to assert additional affirmative defenses as it discovers them through discovery and other
investigation.
FOURTEENTH AFFIRMATIVE DEFENSE
At all relevant times, the State acted in good faith and with justification.
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28
561572-Wilmington Server 1A - MSW
FIFTEENTH AFFIRMATIVE DEFENSE
At all times, the State acted in accordance with the Abandoned Property
Law, the Regulations and the other applicable laws of the State.
WHEREFORE, the State respectfully requests the Court to enter an order:
a. Dismissing the Amended Complaint with prejudice;
b. Awarding the State its reasonable attorneys' and professionals' fees,
expenses and costs; and
c. Awarding such other relief as the Court deems just and proper.
/s/ Lawrence W. Lewis
Lawrence W. Lewis (I.D. No. 2539) State Solicitor John S. McDaniel (I.D. No. 2477) Deputy Attorney General Delaware Dept. of Justice 820 N. French St. Wilmington, Delaware 19801 Tel.: (302) 577-8400
DATED: January 12, 2009
Respectfully submitted,
/s/ Edward B. Micheletti
Edward P. Welch (I.D. No. 671) Edward B. Micheletti (I.D. No. 3794) Rachel J. Barnett (I.D. No. 4876)SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP One Rodney Square P.O. Box 636 Wilmington, Delaware 19899-0636 Tel.: (302) 651-3000
Attorneys for Defendants Richard S. Cordrey,
Patrick T. Carter, and the Department of
Finance, Division of Revenue for the State of
Delaware
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