A plea to Delaware jurists: Chancellor McCormick's Tornetta v. Musk opinion raises an important issue. I edit a widely used casebook on corporate law. I need to keep keep blocks of reading to about 20 pages if I want students to read it. How the heck am I supposed to trim a 200…
— Steve Bainbridge (@PrawfBainbridge) February 1, 2024
If we assume founders and managers have an incentive to minimize their cost of capital, they will prefer to incorporate in a state that ensures investor protection. By demonstrating that Delaware will hold even one of the richest CEOs in the world to account, the Chancellor…
— Steve Bainbridge (@PrawfBainbridge) February 1, 2024
In re the proper standard for reviewing controlling shareholder transactions, see also:
— Steve Bainbridge (@PrawfBainbridge) January 31, 2024
As Delaware contemplates the https://t.co/CJZRDylwyu case, the court should acknowledge that not all controlling shareholder transactions should require cleansing.https://t.co/iijBk1N9Tg
In Tornetta v. Musk, Chancellor McCormick states that "Delaware's most onerous standard of review, entire fairness, applies because [Musk's compensation plan] was a conflicted-controller transaction." But do all controller transactions involve a conflict? I think not.
— Steve Bainbridge (@PrawfBainbridge) January 31, 2024
Reading Tornetta v. Musk,my initial reaction is that Chancellor McCormick is trying a little too hard to be funny. The Star Trek reference, for example.
— Steve Bainbridge (@PrawfBainbridge) January 31, 2024
