Updates

Delaware Transactional Law Updates

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With limited exceptions, the Delaware Court of Chancery will honor provisions of alternative entity agreements that contract away the default rules of statutes, so parties should take care that they understand all the implications of such agreements

Document: Huatuco v. Satellite Healthcare, Civil Action No. 8465-VCG (Del. Ch. Dec. 9, 2013) A member of a Delaware limited liability company (the “LLC”) filed a complaint seeking to judicially dissolve the LLC under the Delaware Limited Liability Company Act (the...

Directors of Delaware corporations should be aware that common stock must be issued pursuant to a properly executed written instrument or the Court of Chancery will treat the stock as void, even if this leads to an inequitable result

Document: Boris v. Schaheen, C.A. No. 8160-VCN (Del. Ch., December 2, 2013) The purported directors and majority stockholders of Corporations A and Corporation B signed written consents removing a third director from the board, after which they filed an action...

The dissolution scheme under the Delaware General Corporation Law (the “DGCL”) does not time-bar claims by third parties against the dissolved corporation after a 10-year period, despite provisions stating that the corporation must set aside assets for claims likely to arise within 10 years

Document: Anderson v. Krafft-Murphy Co. Inc., No. 85, 2013 (Del. November 26, 2013) Tort claimants sought the appointment of a receiver for a dissolved Delaware corporation. The Court of Chancery did not appoint the receiver and the Delaware Supreme Court reversed and...