Zync v. Porsche: Omissions in Hydrogen Bombs and Corporate Filings

Vice Chancellor Laster begins his May 26, 2026 opinion in the Zync, Inc. v. Porsche Investments Management, S.A. case with a Cold War era tale of a malfunctioning safety switch that prevented a hydrogen bomb from exploding over Goldsboro, North Carolina. He invokes this story to show the great importance some omissions can have. The opinion then goes on, however, to find that not all omissions are quite so meaningful and some omissions are insufficient to establish personal jurisdiction.

The case that provoked this evocative imagery from V.C. Laster concerns a now-defunct in-vehicle entertainment startup, Zync, Inc. In 2020, Porsche’s technology startup investment arm, Porsche Investments S.A., invested US$2.9 million in Zync in exchange for 5% equity and the right to nominate one of Zync’s three board members. An investor rights agreement also guaranteed that Zync could not take certain actions without approval of the Porsche-nominated director.

Zync now contends this investment was part of a “catch and kill” investment strategy by Porsche where Porsche would invest in startups in exchange for governance rights and then use those governance rights to block other sources of capital. Consistent with this alleged strategy, the Porsche-nominated director, Christian Knörle, repeatedly blocked Zync’s attempts to secure other sources of funding by saying he could not approve until his manager, Ulrich Thiem, approved, and Thiem’s approval never came. Eventually, without sufficient funding, Zync was forced to shut down.

Zync then filed suit against Porsche, Knörle, and Thiem. In relevant part, Zync alleged that Knörle had breached his fiduciary duties as a board member of Zync by refusing to approve necessary funding and that Thiem had aided and abetted in this breach of fiduciary duty and tortiously interfered with the failed financing arrangements. Thiem moved for dismissal based on lack of personal jurisdiction.

In response, Zync first invoked the conspiracy theory of jurisdiction which allows for jurisdiction over a defendant who is a member of a conspiracy to defraud if, among other requirements, a substantial act or substantial effect in furtherance of the conspiracy occurred in the forum state. In support, Zync identified two alleged Delaware-directed acts: (1) Thiem’s signing of agreements with Zync, which contained Delaware choice-of-law clauses and (2) Thiem’s nomination of Knörle as the Porsche director on the board of Zync, a Delaware corporation. V.C. Laster found both of these acts insufficiently directed to Delaware and, in any event, found they were both taken on behalf of Porsche, and so could not provide jurisdiction over Thiem.

Zync also argued in the alternative that personal jurisdiction was proper under Delaware’s Long-Arm Statute, which conveyed specific jurisdiction over any person who “[c]auses tortious injury in the State by an act or omission in this State” (emphasis added). Zync contended that, but for Thiem’s tortious conduct, Zync would have entered into one of the contemplated financing arrangements, which would have necessitated a filing with the Delaware Secretary of State. Thiem’s conduct caused the omission of a filing in Delaware, thereby creating personal jurisdiction.

V.C. Laster gave this argument “top marks for creativity” but ultimately rejected it because the alleged omission of a filing did not itself cause a tortious injury in Delaware. The omission was instead a “collateral effect of the alleged breach of duty,” which was insufficient to create jurisdiction.

In closing, V.C. Laster reflected on the asymmetry of this rule, which made it easier to find jurisdiction based on an act in Delaware than an omission, and acknowledged that this asymmetry may come to the fore more often in the future, given the recent proliferation of investor-level and counterparty-level blocking rights.

In addition to these closing thoughts, one other takeaway from the opinion is that, even in the arena of personal jurisdiction, novel arguments by litigants that earn “top marks for creativity” can inspire thoughtful and even evocative opinions from the Court of Chancery, even if those novel arguments are not ultimately successful.

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