Dear Friends, 

As more companies leave Delaware – such as TransPerfect did, amid years of abuse from Delaware’s Chancery Court – Delaware Vice Chancellor Travis Laster said that while Delaware’s Chancery Court could block companies from leaving, he noted that it’s an “extreme” measure to stand in their way. 

Laster called it extreme and not warranted in the TripAdvisor case, as the story below says, which shows Laster isn’t dumb enough to get his court caught up in such legal quicksand of not letting companies leave if they want.

As I see it, folks, the Chancery Court bullies companies and their directors, while protecting their own, at the expense of company shareholders. Who can blame Elon Musk and other large, successful companies from leaving to incorporate outside of Delaware? Anywhere but Delaware is where companies are much more likely to be treated fairly and not fighting against a crooked Chancery Court, full of cronies looking out for each other, while neglecting company shareholders, which is where their focus should be. That’s why companies are leaving America’s First State, it is quite clear to me.

Please share your feedback on this, folks. It is always welcome and appreciated. 

Respectfully Yours, 

JUDSON Bennett–Coastal Network 


TripAdvisor can ditch Delaware in case Elon Musk highlighted

By Jody Godoy

Feb 20 (Reuters) – TripAdvisor can proceed with its planned move to Nevada but shareholders can seek damages, a Delaware judge ruled on Tuesday in a case billionaire Elon Musk highlighted as an attempt to “lock the doors” on firms leaving the state.

Two shareholders had sued directors at TripAdvisor and its parent company last year and asked the court to block the move, claiming it was designed to benefit Greg Maffei, CEO of parent company Liberty TripAdvisor, at their expense.

Delaware Vice Chancellor Travis Laster wrote that while Delaware’s Chancery Court has the power to block companies from reincorporating elsewhere, he called it an “extreme” measure not warranted in the case.

While Laster said the move can go forward, he found that it will be subject to a review for “entire fairness” to shareholders, which he called the “most onerous standard” under Delaware law.

The judge suggested that shareholders may seek damages if TripAdvisor’s stock sinks on its reincorporation.

But the directors can also try to show that Nevada law does not benefit Maffei as shareholders claim, he said.

Attorneys for the shareholders declined to comment. A TripAdvisor spokesperson did not immediately reply to a request for comment.

The case has gotten publicity from Musk, who has blasted Delaware after a judge there ruled to invalidate his $56 billion pay package from Tesla (TSLA.O), opens new tab.

The carmaker’s CEO has said on social media that companies should leave Delaware, which is home to much of corporate America, “before they lock the doors, as they just did with Tripadvisor.”