Background
In March 2021, CF Finance Acquisition Corp. II (“CF II”) completed a de-SPAC merger with View Operating Corporation (“Legacy View”), after which Legacy View survived as a wholly owned subsidiary of the renamed entity, Public View, Inc. Following the merger, Public View’s audit committee disclosed an internal investigation into potential material misrepresentations in SEC filings. That investigation spawned three proceedings: a shareholder lawsuit against CF II and former officer Vidul Prakash (settled in late 2025), a stockholder derivative action against Legacy View’s and Public View’s directors and officers, and an SEC enforcement action against Prakash.
Legacy View sought coverage from its five liability insurers for defense and settlement costs arising from those proceedings. Four insurers provided coverage; only StarStone Specialty Insurance Company denied it. Legacy View then filed suit in the Delaware Superior Court. The dispute centered on a “follows form” policy StarStone had issued to Legacy View, which incorporated a primary policy’s “Company Reimbursement” provision—requiring the insurer to pay loss arising from a claim only when and to the extent the company has actually indemnified the insured person. StarStone argued it had no current obligation to advance Prakash’s defense costs because Legacy View had not yet actually reimbursed Prakash.
On March 30, 2026, the Superior Court denied StarStone’s motion for summary judgment and granted Legacy View’s motion for partial summary judgment. StarStone applied to the Superior Court to certify an interlocutory appeal under Delaware Supreme Court Rule 42. The Superior Court denied that application on April 28, 2026, finding that the summary judgment ruling involved only routine contract interpretation, raised no novel question of law, did not implicate 8 Del. C. § 145 governing statutory indemnification, and presented no irreparable harm warranting midstream appellate intervention. StarStone then filed a notice of appeal seeking interlocutory review directly in the Supreme Court.
The Court’s Holding
The Delaware Supreme Court refused the interlocutory appeal. Exercising its sound discretion under Rule 42(d)(v) and giving due weight to the Superior Court’s analysis, the Court held that the application did not meet the strict certification standards of Rule 42(b). The Court agreed with the Superior Court that no exceptional circumstances justified interlocutory review of the summary judgment ruling.
The Court further concluded that the potential benefits of interlocutory review did not outweigh the inefficiency, disruption, and probable costs that an interlocutory appeal would impose—the balancing test required under Rule 42(b)(iii). Because the summary judgment ruling resolved a case-specific question of contract interpretation rather than a novel legal issue, and because StarStone had not demonstrated irreparable harm, the Court ordered the interlocutory appeal refused.
Key Takeaways
- Delaware courts apply a strict standard for interlocutory certification; routine contract interpretation rulings, regardless of their financial stakes, generally will not satisfy Rule 42(b).
- An insurer’s dispute over the timing of its payment obligation under a “company reimbursement” D&O policy provision does not, without more, present the novelty or urgency required for midstream appellate review.
- A claimed connection to Delaware’s corporate indemnification statute (8 Del. C. § 145) will not support interlocutory certification where the trial court’s ruling rested solely on policy language and did not actually construe or apply the statute.
- Absence of an irreparable harm argument weighs heavily against granting interlocutory review under Rule 42(b)(iii) factor H.
Why It Matters
This order reinforces Delaware’s high bar for interlocutory appeals and signals that insurance carriers disputing D&O coverage obligations in the wake of de-SPAC litigation cannot use Rule 42 certification as a litigation tactic to delay adverse trial-court rulings. The Supreme Court’s terse agreement with the Superior Court’s analysis—that contract interpretation disputes lack the urgency or novelty warranting “midstream intervention”—reaffirms the principle that policy disputes, even large ones, ordinarily must await a final judgment before reaching the high court.
For practitioners, the decision is a reminder that a successful Rule 42 application requires more than significant dollars at stake or a disagreement with how the trial court read a contract. Applicants must identify a genuine novel legal question, a statutory interpretation issue ripe for settlement, or concrete irreparable harm—and the absence of any of those elements, as here, will doom an interlocutory appeal even when multiple complex proceedings are pending in parallel.