News & Analysis as of

Fiduciary Duty Delaware

Troutman Pepper Locke

Delaware Court of Chancery Allows Amendment of LLC Agreement to Permit Disparate Consideration Where Amendment Provisions Were...

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In Faiz Khan and Ralph Finger v. Warburg Pincus, LLC et al., the Delaware Court of Chancery held that the implied covenant of good faith and fair dealing was not applicable to a private equity sponsor’s amendment of a limited...more

Ballard Spahr LLP

DE Chancery Court Curbs Inspection to Investigate Alleged Fraud

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In Scaramellino v. Arencibia Holdco, LLC, Delaware’s Chancery Court recently approved a limited liability company’s narrow production in response to a broad books and records inspection demand, despite the petitioner’s...more

Morris James LLP

Chancery Rejects Attempt to Disguise Breach of Fiduciary Duty Claim Where LLC Agreement Waived All Traditional Fiduciary Duties

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Delaware permits the elimination of fiduciary duties in limited liability company agreements. Notwithstanding, and just like in any other contract, parties to a limited liability company agreement are still subject to the...more

Hogan Lovells

Solak v. Mountain Crest Capital: fiduciary duties claims abound for SPAC sponsors and directors

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In Solak v. Mountain Crest Capital, the Delaware Court of Chancery found that a stockholder plaintiff pleaded a viable breach of fiduciary duty claim based on an alleged failure of the board of directors of a SPAC to disclose...more

Allen Matkins

Nevada Legislature Approves Amendments To The State's Corporate Law

Allen Matkins on

In prior posts, I have discussed some the changes that AB 239 would make to Nevada's corporate law.  Last week, I testified in my individual capacity in support of the bill before the Senate Judiciary Committee.  On Wednesday...more

King & Spalding

Delaware Bankruptcy Court Sides with Trustee in Two Related Orders in $500 Million Fraudulent Transfer Action Arising out of...

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In related orders in an action to recover over $500 million in alleged fraudulent transfers arising out of the bankruptcy of an education technology company, the U.S. Bankruptcy Court for the District of Delaware denied...more

Fenwick & West LLP

Delaware Amends General Corporation Law to Stanch Company Exodus

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On March 25, Delaware adopted significant amendments to §§ 144 and 220 of the Delaware General Corporation Law which aim to provide greater clarity and predictability to corporate fiduciaries in light of certain recent...more

Allen Matkins

This Texas Case Illustrates Why Delaware Corporations Are Choosing Nevada

Allen Matkins on

Bright-eyed Athena, the goddess of wisdom, was not birthed of a woman.  Rather, she sprang from the head of Zeus after he swallowed Metis, the pre-Olympian goddess of wisdom...more

Vinson & Elkins LLP

Delaware Court of Chancery Dismisses Claims Relating to Sale of Company Against Private Equity Majority Owner

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In the latest instance of a private equity seller vindicating contractual rights in the Delaware Court of Chancery, on April 30, Vice Chancellor Lori W. Will rejected attempts by minority LLC members in urgent care provider...more

DLA Piper

Amendments to Delaware General Corporation Law Expand Safe Harbor for Controlling Stockholder Transactions and Circumscribe Books...

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The Governor of Delaware has signed into law Senate Bill 21 (SB 21), which amends certain sections of the Delaware General Corporation Law (DGCL) governing controlling stockholder transactions under DGCL Section 144 and...more

Mayer Brown

Delaware Law Alert: Chancery Court Dismisses Challenge to Elimination of Tag-Along Rights in Private Equity-Backed Healthcare...

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A recent Delaware Chancery Court decision provides important guidance for private equity sponsors, minority investors, and deal professionals regarding the enforceability of contractual waivers and the limits of the implied...more

Woodruff Sawyer

Derivative Suit Exposure: More Art Than Science

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Derivative suits are a topic of discussion that continues to challenge directors, officers, and insurers alike. The issue is particularly fraught for individual directors and officers because Delaware-incorporated companies...more

ArentFox Schiff

Delaware’s New Approach To Interested Director and Minority Stockholder Protections

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On March 25, Delaware governor, Matt Meyer, signed into law Substitute 1 to Senate Bill 21 (SB 21), following its rapid approval by the Delaware state legislature. This legislative measure aims to counter the current trend of...more

Morris James LLP

Court of Chancery Applies the American Rule and Denies Attorneys’ Fees Despite Fiduciary Breach

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In re Straight Path Commc’ns Inc. Consol. S’holder Litig., C.A. No. 2017-0486-SG (Del. Ch. Oct. 29, 2024) - The Court of Chancery in this stockholder class action refused to award attorneys’ fees where the Court found the...more

Davies Ward Phillips & Vineberg LLP

Governance Insights: Dual Fiduciaries – A Cautionary Tale for Nominee Directors

The latest edition of Davies’ Governance Insights is now available. In this issue, we review the Manti Holdings decision from Delaware. For boards, nominees and nominating shareholders, the decision is a reminder of the...more

Cadwalader, Wickersham & Taft LLP

The Impact of In re 301 W N. Ave., LLC on the Enforcement of Bankruptcy-Remote Protections

Executive Summary - The recent decision In re 301 W N. Ave., LLC, 666 B.R. 583 (Bankr. N.D. Ill. 2025) represents a significant development at the intersection of corporate governance, commercial real estate, and...more

Morris James LLP

Chancery Finds Merger Validly Amended LLC Agreement and Effectively Removed the LLC’s Manager

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Campus Eye Management Holdings LLC v. DiDonato, C.A. No. 2024-0121-LWW (Del. Ch. Aug. 30, 2024) - This case arose out of a dispute between an optometrist who sold a majority stake in his company to a private equity buyer,...more

Seyfarth Shaw LLP

Delaware General Corporation Law 2025 Amendments--Interested Person/Control Person Transactions and Inspection Rights

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The State of Delaware, home to a majority of the so-called “Fortune 500” corporations, has been the subject of a variety of criticisms relating to corporate governance, director and officer litigation risk, controlling...more

Perkins Coie

After Threat of Exodus, Delaware Lawmakers Swiftly Respond: Six Things To Know About Recent Amendments to the DGCL

Perkins Coie on

Several recent decisions in Delaware courts have driven a variety of companies to publicly initiate actual or threatened reincorporation out of Delaware. After fallout from these cases and corporate actions, Delaware...more

Patterson Belknap Webb & Tyler LLP

Delaware Enacts Changes to the Delaware General Corporation Law

On March 25, 2025, the Delaware Governor, Matthew Meyer, signed into law Senate Bill 21 (“SB 21”) which amends Sections 144 and 220 of the Delaware General Corporation Law (the “DGCL”). SB 21 codifies (a) the process to...more

Nelson Mullins Riley & Scarborough LLP

Reincorporating a Delaware Entity Elsewhere: Could This Be the Next Great DExodus?

Amidst a flurry of recent reincorporations—conveniently coined “DExits”—of major corporations such as Dropbox, Tesla, and potentially Meta, Delaware’s future as a corporate safe-haven faces uncertainty. Delaware has long been...more

Perkins Coie

Delaware Significantly Narrows Scope of Stockholder Inspection of Corporate Books and Records

Perkins Coie on

Delaware Governor Matt Meyer signed into law substantive amendments to Section 220 of the Delaware General Corporation Law (Section 220), the statute that allows stockholders of corporations organized under Delaware law to...more

Mintz Edge

The Delaware Empire Strikes Back to Protect its Turf!

Mintz Edge on

On March 2025, a sweeping reform of the Delaware General Corporation Law (DGCL) took effect. SB 21 codifies safe harbors for conflicted transactions, clarifies director independence standards, and significantly tightens...more

Alston & Bird

Delaware Legislators Swiftly Enact Proposed Changes to Corporate Code

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Our Securities Litigation and Securities Groups discuss the final version of Delaware’s SB 21 that brings the most impactful changes to Delaware corporate law in decades....more

Vorys, Sater, Seymour and Pease LLP

Significant Amendments to Delaware General Corporation Law Enacted

On March 25, 2025, the Governor of Delaware signed into law Senate Bill 21 (SB 21) which amends Sections 144 and 220 of the Delaware General Corporation Law (DGCL) to codify and clarify safe harbors for transactions involving...more

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