I left for a week-long vacation in the summer of 2022, not knowing I was in my final days before a disproportionately large part of my beat would be taken over by a certain chronically online billionaire.
Two days into that vacation, the social media company formerly known as Twitter sued Elon Musk. Maybe someday there will again be a year in which Musk is not at the center of a major case pending in the Delaware courts, but 2025 is not that year.
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Delaware ended 2024 with some litigation cliffhangers, leaving corporate attorneys seeking answers from the Delaware Supreme Court on several issues that were addressed in the Court of Chancery.
One area of Delaware law that came up frequently in 2024 and is expected to continue to be closely watched as more case law is established is that of conflicted controller transactions, specifically what exactly constitutes such a transaction and how judicial scrutiny can be applied to one.
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It’s been 14 months since the Second Circuit Court of Appeals laid the groundwork for defendants to raise price-impact defenses in securities litigation in Arkansas Teacher Retirement System v. Goldman Sachs Group Inc. In recent talks with securities litigators, I’ve asked how many cases they are seeing that cite the Goldman Sachs case.
The answer I’ve heard across the board is that when it comes to event-driven securities litigation that makes it to the class certification stage, just about everyone on the defense side cites Goldman Sachs.
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In the months leading up to argument over the Boy Scouts of America’s reorganization plan before the Third Circuit, questions about third-party releases in bankruptcy have been addressed by a handful of other courts.
While it’s not the only issue in play on appeal, those opposed to the confirmed Chapter 11 plan that’s been effective since April 2023—specifically, a subset of sexual abuse accusets whose compensation is a key part of the plan and a group of Boy Scout insurers—have spent years challenging the opt-out third-party releases that were part of a global settlement within the plan, confirmed by Delaware Bankruptcy Court Judge Laurie Selber Silverstein and upheld by U.S District Court Judge Richard G. Andrews.
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Texas has a new system of business courts up and running on the heels of an ongoing conversation about Delaware’s corporate primacy.
While Texas attorneys have been upfront with their hope that the state’s newest courts will help raise Texas’ corporate law to Delaware’s level, corporate attorneys across the country are all but unanimous: Delaware remains the champ, and that’s not changing, at least not any time soon.
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The first handful of cases have been filed in Texas’ business courts, and Texas attorneys are looking forward to seeing how their dockets continue to unfold.
Many are optimistic about the courts’ potential but expect it will take at least a year to build up the jurisprudence that could make them a reliable venue for business litigation.
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Two weeks ago, Delaware enacted a series of amendments to its corporation law, as it does every summer.
Unlike every other summer, two weeks after the amendments went into effect, those who watch the Court of Chancery closely are still offering public critique. But alongside that discussion, a secondary debate has broken out about when judges on the Court of Chancery, with its signature decorum, should and should not weigh in on laws they will later apply to Delaware’s corporate franchise.
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Amendments to the Delaware General Corporation Law approved by the legislature and Gov. John Carney become effective Aug. 1, generally addressing three areas of corporate governance in response to three Court of Chancery decisions issued within the past year.
The latest batch of changes has seen less unanimous support from the corporate bar than the amendment process usually does, with one area in particular drawing criticism: In response to Moelis & Co. shareholder litigation decided in February, Section 122 will now allow corporate boards to use their discretion to sign agreements giving governance rights to shareholders they previously could not have under Section 141(a).
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On average, jurists who serve on the highest state courts in the country are paid a little more than $200,000 per year.
That’s at the low end of what the biggest firms are currently paying their first-year associates, according to a report on National Law Journal 500 firms.
Those who have served on their states’ courts of last resort say that while judges have always known the move into a public service role from other positions in the legal field comes with a pay cut, they’re worried that that gap is widening to the point of turning away attorneys who have the potential to serve their state well and decreasing retention on the bench.
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A judicial report was recently released detailing steps that have been taken in the past two years to increase diversity on Delaware’s bench and bar, the bulk of which involve creating a pipeline of future Delaware attorneys through increased access to education and bar admission.
That has included lowering the bar cut score by two points, cutting back on essay questions, reducing the length of clerkships required, narrowing the checklist of legal proceedings prospective attorneys need to sit in on and lowering late application fees.
Those involved with the bar admissions process say more time is needed to say for sure whether the changes will lead to more attorneys practicing in Delaware, but that early signs have been promising.
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