Golden Rule Financial Corporation v. Shareholder Representative Services LLC

── Golden Rule Financial Corporation v. Shareholder Representative Services LLC ── Court: Court of Chancery of Delaware Date: April 30, 2026 Category: General IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE GOLDEN RULE FINANCIAL ) CORPORATION, ) ) Plaintiff, ) ) v. ) C.A. No. 2022-0065-PAF ) SHAREHOLDER ) REPRESENTATIVE SERVICES ) LLC, ) ) Defendant. ) MEMORANDUM OPINION Date Submitted: August 4, 2025 Date Decided: April 30, 2026 Joseph C. Schoell, Oderah C. Nwaeze, Renée M. Dudek, FAEGRE DRINKER BIDDLE & REATH LLP, Wilmington, Delaware; Randall E. Kahnke, Peter C. Magnuson, Michael J. Kaupa, Hannah M. Leiendecker, Anderson C. Tuggle, FAEGRE DRINKER BIDDLE & REATH LLP, Minneapolis, Minnesota; Attorneys for Plaintiff Golden Rule Financial Corporation David E. Ross, ROSS ARONSTAM & MORITZ LLP, Wilmington, Delaware; Erin C. Johnston, Kasdin M. Mitchell, Yaffa A. Meeran, Austin J. Del Priore, KIRKLAND & ELLIS LLP, Washington, D.C.; Mary T. Reale, KIRKLAND & ELLIS LLP, New York, New York; Attorneys for Defendant Shareholder Representative Services LLC FIORAVANTI, Vice Chancellor  This post-trial decision resolves claims for breach of representations and warranties in a merger agreement. The buyer alleges the seller misrepresented that its financial statements were accurate and in compliance with generally accepted accounting principles. Specifically, the buyer contends that the seller represented that it had adopted an accounting standard (ASC 606), which dictates how certain revenue is recognized, but misapplied that standard. As a result, the buyer claims it suffered an indemnifiable loss of more than $38 million, which it was required to pay to the seller in a post-closing purchase price adjustment dispute. The seller contends that the buyer has not established a breach of contract on the merits and that the buyer’s claims are barred under the doctrine of res judicata and the merger agreement’s indemnification limitations. The court concludes that the buyer’s claims are not barred under either of the seller’s theories and that the buyer has prevailed on its breach of contract claims. I. BACKGROUND These are the facts as the court finds them after trial.1 1 Other factual findings are contained in the analysis of the claims. Deposition testimony is cited as “(Surname) Dep.”; trial exhibits are cited as “JX”; stipulated facts in the pre- trial order are cited as “PTO”; and references to the docket are cited as “Dkt.,” with each followed by the docket number and the relevant section, page, paragraph, or exhibit. Citations to testimony presented at trial are in the form “Tr. # (X),” with “X” representing the name or surname of the speaker. Citations to the transcript of post-trial oral argument (Dkt. 161) are in the form of “Post-Trial Arg.” After being identified initially, individuals are referenced herein by their surnames. Unless otherwise indicated, citations to the  A. The Parties and the Merger Agreement Golden Rule Financial Corporation (“Golden Rule” or the “Plaintiff”), a Delaware corporation, is a health-insurance provider and an indirect, wholly owned subsidiary of UnitedHealth Group, Incorporated (“UHG”).2 USHEALTH Group, Inc. (“USHEALTH” or the “Company”), a Delaware corporation, directly or indirectly owns several insurance companies and other entities.3 NEXT Investors USHG, LLC (“NEXT”), a private equity investment fund, was USHEALTH’s controlling stockholder. 4 parties’ briefs are to post-trial briefs. When resolving factual disputes, this decision generally gives more weight to contemporaneous evidence. See Lynch v. Gonzalez, 2020 WL 4381604, at *5 (Del. Ch. July 31, 2020) (“The relative weight