February 10, 2026
A Secretariat expert team, led by Dr. Richard Manning, provided key damages calculations and expert testimony in the precedent-setting Delaware Court of Chancery decision that secured an approximately $811 million award for Fortis Advisors, representative of Auris Health’s former stockholders, in a post-closing earnout dispute with Johnson & Johnson (J&J).
Selendy Gay retained Dr. Manning to serve as their damages expert in this high-stakes case, which centered on J&J’s alleged breach of its 2019 merger agreement to acquire Auris Health, Inc.—a deal that hinged on the development of Auris’ innovative robotic surgery technology. In his role as an expert witness for Fortis, Dr. Manning evaluated and put forth damages under several alternative legal theories.
Following a ten-day trial in September 2024, Vice Chancellor Lori W. Will of the Delaware Court of Chancery issued a decision that awarded more than $1 billion in damages for J&J’s breach of contract, breach of implied covenant, and fraud. The Court ruled that J&J had intentionally delayed achieving key milestones to avoid paying a significant earnout payment to Auris’ stockholders. Additionally, the Court found that J&J’s actions constituted fraud, particularly in undermining Auris’ progress on critical technologies essential to the deal.
The Court adopted Dr. Manning’s approach to damages in rendering its decision, noting they “can reasonably measure what Auris expected to gain using the probability-weighted milestone values assigned by the parties.”1 Additionally, the Court determined the defense’s rebuttal expert’s points were not persuasive in critiquing Dr. Manning’s approach. The Chancery Court’s 2024 decision in full can be read here.
Following the Chancery Court’s decision, the case was brought before the Delaware Supreme Court on J&J’s appeal. On January 12, 2026, the Delaware Supreme Court issued an opinion that affirmed the judgment of the Chancery Court as to breach of contract and fraud, reversed as to the implied covenant, and remanded to the lower court for a recalculation of damages.2 In their opinion, the Delaware Supreme Court affirmed the validity of Dr. Manning’s calculations, noting, “we also uphold the [Chancery Court’s] damages methodology.”3 The Delaware Supreme Court’s opinion can be read in full here.
On January 26, 2026, the Chancery Court delivered a final stipulated judgment of nearly $811 million in damages for J&J’s breach of contract and fraud, which constitutes the largest award in Delaware history in an earnout case.
“I am pleased to have been able to work with a talented team of colleagues at Secretariat on this complex and interesting matter,” notes Dr. Manning. “I am gratified that we were able to provide the economic analysis and testimony to help both the Delaware Chancery Court and the State Supreme court reach their determinations.”
The Secretariat team working on the engagement with Dr. Manning included Dr. Richard Brady, Dr. Kira Stearns, and Jacob Miller. Further details on the case were covered in a Selendy Gay news release.
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