In corporate law, Delaware is kind of like the movie gunslinger that "every piss-ant prairie punk who thought he could shoot a gun would ride into town to try out." And like that gunslinger, Delaware "must have killed more [states] than Cecil B. DeMille." (Bonus points for spotting the source of the quotations.)
Most recently, North Dakota tried. I predicted that effort would fail. It did.
Bloomberg reports that now Wyoming's going to try:
Wyoming is looking to compete with Delaware as a corporate-friendly destination by creating a specialized court that offers lower fees and speedy dispute resolutions.
The proposals are part of a broader push by Wyoming lawmakers to make the state that invented the limited liability company (LLC) into a fintech friendly “Delaware of the West.”
Separate bills planned for the Wyoming state legislative session that started this week would use blockchain technology for commercial filings and business registrations and create a special purpose state-chartered depository bank intended to serve the blockchain industry.
Good luck with that.
A proponent of Wyoming's effort told Bloomberg that “when you go to other competing jurisdictions, a lot of times they have specialty courts that can deal with those specific issues.” It's true that the Delaware Chancery Court specializes in corporate law. But what that overlooks is that Delaware has a 100+ year head start. What matters is not having a specialized court, but having a huge volume of case law. What transactional lawyers (who advise their clients on where to incorporate) want is predictability and certainty. The vast volume of Delaware decisional law makes it possible, in most cases, to write an opinion letter with confidence. Wyoming's new court will be starting from scratch.
As for the much ballyhooed blockchain laws, Delaware's legislature is an expert at spotting new trends and incorporating them into its law. On the blockchain front, Delaware has already moved and doubtless will be evaluating what Wyoming does. If need be, Delaware will copy (and likely improve) the Wyoming laws.
So I fully expect Wyoming to join North Dakota, Nevada, Pennsylvania, etc... who "finally found a home under the boot hill grave that bears [their] name."
