Wednesday, January 15, 2014

Delaware 2013 Corporate Law Round Up

Francis G.X. Pileggi and Kevin F. Brady at Delaware Corporate & Commercial Litigation Blog closely track Chancery and Supreme Court cases out of Delaware.  Their annual Delaware round up, is always a top-notch, quick  and dirty summary of the year. If you haven't kept up with the major cases, or want a quick reference when thinking about what developments to include in your classes this spring or next fall--then this list is for you.

Here are 2 additional cases that I have found noteworthy for some combination of scholarship, teaching and practice reasons:

1.  Chevron forum selection clause enforceability

Chancellor Strine’s opinion in Boilermakers Local 154 Retirement Fund v. Chevron Corp.,et al, upheld the enforceability of a Delaware forum selection clause unilaterally adopted by corporate boards of directors of Defendants.  Plaintiffs dismissed their appeal, and moved to dismiss their remaining claims in Chancery Court leaving intact Chancellor Strine strong support of forum selection clauses.  Chevron was preceded Chevron was preceded by National Industries Group (Holding) v. Carlyle Investment Managements LLC and TC Group LLC, a 2013 Delaware Supreme Court opinion, which addressed the contractual enforceability of forum selection clauses. 

2.  Huatacu Upholding waiver of dissolution rights when not “reasonably practicable” to carry on the business of the LCC.

VC Glasscock reaffirmed Delaware’s commitment to contractual freedom in LLCs by upholding an express waiver of statutory dissolution rights for LLC members.  The case enforced an LLC operating agreement that “rejected all default provisions, and expressly limited members’ rights to those provided in the LLC Agreement.”  The Chancery Court found that dissolution rights, were waivable by LLC members, but that the members remained subject to the non-waivable duty of good faith and fair dealing.  The Chancery Court also left open the possibility that members of an LLC may not divest the Court of all of its equitable authority to order dissolution, but where the parties presented no unusual facts giving rise to such equities, the waiver is enforceable.

-Anne Tucker

Anne Tucker, Business Associations, Corporate Governance, Corporations, LLCs, Teaching, Unincorporated Entities | Permalink


Harvard Law School Forum on Corporate Governance & Financial Regulation posted their Delaware 2013 roundup, which is slightly different. It is available here:

Posted by: Anne Tucker | Feb 19, 2014 11:39:49 AM

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