In the decision of Harrison Metal Capital III, L.P., v. Mathé, et al., C.A. No. 2022-0261-PAF (Del. Ch. Mar. 27, 2024), the Delaware Court of Chancery considered whether plaintiff adequately plead demand futility under Rule 23.1 in its suit
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Chancery Orders Advancement Under Indemnification Agreements of Cancelled Company
By Carl D. Neff
In the decision OrbiMed Advisors LLC v. Symbiomix Therapeutics, LLC, et al., C.A. No. 2023-0769-MTZ, 2024 WL 747567 (Del. Ch. Feb. 23, 2024), the Delaware Court of Chancery considered an advancement dispute. The Court determined that the defendant was obligated…
Delaware Court of Chancery Rescinds Musk’s $55.8B Tesla Stock Option Grant in Key Decision on Corporate Transactions with Controlling Stockholders
By Carl D. Neff
On January 30, 2024, the Delaware Court of Chancery rescinded Tesla, Inc. (“Tesla”)’s January 2018 grant to CEO Elon Musk of performance-based stock options with a potential $55.8 billion maximum value and a $2.6 billion grant date fair value (the…
Court of Chancery Rejects LLC Member’s Overbroad Books and Records Demand
By Carl D. Neff
In Barry Leistner v. Red Mud Enterprises LLC, C.A. No. 2023-0503-SEM (Del. Ch. Dec. 8, 2023), the Delaware Court of Chancery addressed Plaintiff Barry Leistner’s exceptions to a Magistrate’s Final Report that denied his books and records request regarding…
Summary of 2023 Amendments to the Delaware General Corporation Law
By Carl D. Neff
On August 1, 2023, amendments to the Delaware General Corporation Law (“DGCL”) went into effect, simplifying processes for Delaware corporations to take specific corporate actions. The changes focus on authorizing certain stock splits and altering a corporation’s authorized shares.
Key…
Section 225 Board Composition Action Analyzed by Court of Chancery
By Carl D. Neff
In the decision of Barbey v. Cerego, Inc., C.A. No. 2022-0107-PAF (Del. Ch., Sept. 29, 2023), the Delaware Court of Chancery considered the proper constitution of a Delaware corporation’s board of directors under Section 225 of the Delaware General Corporation Law…
Delaware Supreme Court Rejects Confidentiality Restrictions of Section 220 Demand Inspection
By Carl D. Neff
In the decision of James Rivest v. Hauppauge Digital, Inc., No. 442, 2022 (Del. July 10, 2023), the Delaware Supreme Court considered the extent to which a Delaware corporation’s production of books and records under Section 220 of the…
Section 220 Inspection Demand to Investigate Merger Process Granted
By Carl D. Neff
Books and records inspection demands commonly arise in connection with a major transaction of a Delaware corporation, including a merger. The decision of Kosinski v. GGP, Inc., C.A. No. 2018-0540-KSJM (Del. Ch. Aug. 29, 2019) involved such a demand to…
Confidentiality Order Requirement in Delaware Books and Records Actions Clarified by Supreme Court
By Carl D. Neff
A question often arises as to whether a party making a books and records demand under 8 Del. C. § 220 must enter into a confidentiality agreement in order to inspect responsive documents of the corporation.
The Delaware Supreme Court,…
Delaware Courts Are Striking Overly Broad Non-Competes — Even In the Sale of a Business
By Carl D. Neff
Delaware, long viewed to be one of the most business-friendly jurisdictions in the country, has joined the ever-expanding list of jurisdictions that no longer give businesses the benefit of the doubt when it comes to restrictive covenants.
Partners Christina Bost…