WILMINGTON, DE — The Delaware Court of Chancery has rejected a $127 million damages claim against Dometic Corp., ruling that the company did not violate its acquisition agreement with cooler manufacturer Igloo’s former owner and eliminating a potential financial liability stemming from the $677 million acquisition completed in 2021.
In a September 30 ruling, the court found that ACON Igloo Holdings LLC failed to prove that Dometic breached contractual obligations governing Igloo’s operations after the acquisition.
The dispute centered on an earnout provision that would have required an additional payment to ACON if Igloo achieved specified financial targets following the October 2021 transaction.
ACON, an affiliate of private equity firm ACON Investments, alleged that Dometic interfered with Igloo’s operations during the earnout period, preventing the company from reaching the financial threshold required for payment.
The lawsuit accused Dometic of violating ordinary-course operating requirements and contractual provisions prohibiting actions intended to avoid the earnout obligation.
The court rejected those claims and awarded ACON no damages.
The decision followed a trial in March 2026 and post-trial arguments in June.
A significant evidentiary dispute arose in 2024, when Dometic’s attorneys sought communications among ACON, its outside counsel at King & Spalding, and Igloo executives.
ACON had withheld the communications under a claim of common-interest privilege. Dometic argued that including Igloo executives in the exchanges waived that protection because the executives shared a financial interest with ACON rather than a common legal interest.
The court agreed and ordered production of hundreds of emails and text messages.
According to Dometic’s litigation counsel, the communications demonstrated coordination between ACON and Igloo executives over efforts to achieve the earnout target.
The communications figured prominently in the court’s opinion, which characterized certain efforts to meet the financial threshold as tactical measures rather than actions consistent with Igloo’s ordinary business practices.
“The court’s ruling against ACON’s $127 million claim confirms what we have maintained for the past four years: Dometic never breached the purchase agreement,” said Carly Kligler, a partner at Hilgers PLLC who represented Dometic.
The litigation illustrates the contractual risks associated with acquisition earnouts, which link additional payments to a business’s performance after ownership changes.
Hilgers attorneys Alec H. Schultz, Carly A. Kligler, Michael Burns and Sarah G. Perryman represented Dometic alongside Bruce E. Jameson and John G. Day of Prickett, Jones & Elliott PA.
The case is ACON Igloo Holdings, LLC v. Dometic Corp., C.A. No. 2022-1057-LWW, in the Delaware Court of Chancery.
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