Freedom (But With Consequences): In Delaware, Absolute Litigation Privilege Inapplicable To Nullify Contractual Non-Disparagement Repurchase Trigger

The absolute litigation privilege is a long-standing legal principle that statements made during the course of a judicial proceeding by participants in the proceeding (whether parties, attorneys, witnesses, or judges) are absolutely privileged, protecting the speaker from subsequent claims of defamation or libel arising out of those statements.

The public policy objective behind the privilege is fairly straightforward. Parties to an action should be free to litigate their case—whether zealously prosecuting their claims or vigorously defending against an adversary's claims—without fear that statements made during litigation will open them up to future claims for defamation. A recursive loop of litigation (i.e. suing you because of what you said when you sued me) serves no one, least of all the courts.