Sky Blog
Elon Musk finally has his 2018 Tesla pay package back. The Delaware Supreme Court has spoken. The saga that consumed years of litigation, untold judicial energy, and more Twitter commentary than any fiduciary duty case deserves is, at least formally, …
Elon Musk can cash the largest paycheck in history, the Supreme Court of Delaware has ruled in a narrow and sensible opinion grounded in longstanding principles of equity and contract law.
To catch up: Tesla and Musk entered into an …
There have recently been three excellent working papers on the problems facing Delaware corporate law—one by Professor Charles Whitehead, one by Professors Marcel Kahan and Ed Rock, and one by practitioners Greg Varallo, Andrew Blumberg, and Ben Potts…
SEC Chairman Paul Atkins’ speech last week in Delaware sounded to many like a death knell for shareholder proposals under Rule 14a-8. In fact, it was far more strategic: the opening move to test whether Delaware corporate law even permits …
On October 15, the Delaware Supreme Court heard arguments in In re Tesla, Inc. Derivative Litigation, more commonly known as Richard J. Tornetta v. Elon Musk, et al. and Tesla, Inc., the stockholder derivative action rescinding Elon Musk’s …
Founders and early investors increasingly maintain control of companies while holding small economic stakes in them – raising fundamental questions about how Delaware courts can enforce accountability in corporate governance. In a new working paper, I challenge the courts’ …
In a recent article, I analyze the function of shareholder ratification in corporate governance and argue that understanding this function is critical to both refining shareholder-based cleansing mechanisms and appreciating their inherent limitations. Although I focus on Corwin cleansing in …
As I write this from the Tulane Corporate Law Institute’s annual conference in New Orleans, the energy is palpable. While Mardi Gras revelers have vacated the streets, they’ve been replaced by a different phalanx of uncharacteristically confrontational carousers: corporate law …
On February 20, Delaware Supreme Court Chief Justice Collins Seitz met with members of the state’s General Assembly and delivered some sobering words: “Along with our respect for your legislative judgments, I ask you to consider the importance of judicial …
In Maffei v. Palkon, the Delaware Supreme Court unanimously held that the business judgment rule applies to a corporation’s decision to change its state of incorporation, even if the move arguably favors a controlling stockholder by reducing future liability …
Last week, in Maffei v. Palkon, the Delaware Supreme Court held that the decision to change the corporate domicile of a Delaware corporation with a controlling stockholder to Nevada is subject to the business judgment rule, making stockholder challenges …
One distinctive feature of the U.S. economy over recent decades has been the rise of the entrepreneur-dominated public company. This development has derived largely from the growth of private funding available through venture capital, so that initial public offerings have …
The 2024 amendments to the Delaware General Corporation Law (“DGCL”) were born from an atypical period of acrimony and controversy among the corporate bar, stockholder advocates, and corporate law academics, including harsh public criticism of members of the Court of …
In a typical activist campaign, the activist threatens to launch a proxy fight unless the board of directors agrees to take certain actions to increase shareholder value, such as selling off company assets or replacing the CEO. Increasingly, however, there …
Recently in Kellner v. AIM ImmunoTech, Inc., the Delaware Supreme Court clarified the legal tests applicable when stockholders challenge advance notice bylaws. A key aspect of the Supreme Court’s ruling is the importance of distinguishing between a facial and …
The first half of 2024 has been a watershed moment for the development of controller law in the Delaware courts. Among the highlights, the Delaware Supreme Court reexamined and confirmed that transactions involving a conflicted controller will invoke entire fairness …
On February 23, 2024, the Delaware Court of Chancery issued its decision in West Palm Beach Firefighters’ Pension Fund v. Moelis & Company, which invalidated a stockholder agreement between Moelis & Company (the “Company”) and its founder and controlling …
In the important 2014 case of Kahn v. M & F Worldwide Corp., the Delaware Supreme Court held that freeze-out mergers, in which a controlling stockholder takes a company private, are subject to Delaware’s heightened “entire fairness” standard of …
On February 20, the Delaware Court of Chancery refused to enjoin the conversion of a Delaware corporation, TripAdvisor, Inc. (“TripAdvisor”), into a Nevada corporation but declined to dismiss claims for monetary damages against the company’s controlling stockholder in connection with …