Recent Developments to Delaware LLC and LP Acts
Delaware limited liability companies (“LLCs”) and Delaware limited partnerships (“LPs”) are increasingly common vehicles used in connection with a diverse range of business applications in the real estate world. Such broad range of applications is buttressed by the Delaware legislature’s emphasis on the primary of freedom of contract for LLCs and LPs and the resulting flexibility…
2024 Proposed Amendments to the General Corporation Law of the State of Delaware
Legislation proposing to amend the General Corporation Law of the State of Delaware (the “DGCL”) has been approved by the Council of the Corporation Law Section of the Delaware State Bar Association and is expected to be introduced to the Delaware General Assembly for consideration during its 2024 regular session. If enacted, the 2024 amendments will,…
Recent Developments in Delaware Corporate Law
125 Years of Helping Clients Navigate the Intricacies of Delaware Corporate Law Richards, Layton & Finger has been defining Delaware law since 1899. Continuing our long tradition of providing insight into the evolution of our state’s influential laws, this publication highlights recent Delaware corporate and alternative entity cases as well as statutory developments in our state.Our…
Grabski v. Andreessen: Court of Chancery Addresses Brophy Claims Against Officers and Directors in a Direct Listing
In Grabski v. Andreessen, C.A. No. 2023-0464-KSJM (Del. Ch. Feb. 1, 2024), the Delaware Court of Chancery declined to dismiss fiduciary claims against officers and directors of Coinbase Global, Inc. who sold shares in a going-public transaction. In the opinion, the court, which has in recent years decided a number of cases involving companies going public…
Delaware Limited Partnership Law Update
Cantor Fitzgerald, L.P. v. Ainslie: Delaware Supreme Court Upholds Validity of Forfeiture-for-Competition Provisions in Limited Partnership Agreement Based on Freedom of Contract Principles In Cantor Fitzgerald, L.P. v. Ainslie, C.A. No. 9436 (Del. Jan. 29, 2024), the Delaware Supreme Court reversed a prior ruling by the Delaware Court of Chancery and found that provisions of a…
Cantor Fitzgerald, L.P. v. Ainslie: Delaware Supreme Court Upholds Validity of Forfeiture-for-Competition Provisions in Limited Partnership Agreement Based on Freedom of Contract Principles
In Cantor Fitzgerald, L.P. v. Ainslie, C.A. No. 9436 (Del. Jan. 29, 2024), the Delaware Supreme Court reversed a prior ruling by the Delaware Court of Chancery and found that provisions of a limited partnership agreement authorizing a partnership to withhold distributions otherwise owed to former partners who compete with the partnership (forfeiture-for-competition provisions) are enforceable. …
Whitestone v. Pillarstone: Delaware Court of Chancery Holds Adoption of Poison Pill Breaches Implied Covenant of Good Faith and Fair Dealing
In Whitestone REIT Operating Partnership, L.P. v. Pillarstone Capital REIT, C.A. 2022-0607-LWW (Del. Ch. Jan. 25. 2024), the Delaware Court of Chancery held that the general partner of a limited partnership breached the implied covenant of good faith and fair dealing when it adopted a shareholder rights plan (the “Rights Plan”) that effectively thwarted a limited…
Department of Labor Announces Final Rule on Employee or Independent Contractor Classification Under the FLSA
On January 10, 2024, the U.S. Department of Labor (“DOL”) published a final rule, effective March 11, 2024, that revises the DOL’s guidance on how to analyze whether an individual providing services is an employee or independent contractor under the Fair Labor Standards Act (“FLSA”). Under the new rule, the ultimate inquiry is whether the worker…
Delaware Laws & Programs Affecting Business – 2024 Edition
Delaware Laws & Programs Affecting Business presents an introduction to Delaware and an overview of the laws and programs relating to doing business in the state. Our economy is diverse, and our legal framework is intentionally crafted to foster robust business activity. Our widely copied business laws lead the nation in clarity and predictability. Government…
Court of Chancery Enforces Certain Advance Notice Bylaws, While Invalidating Others, in Upholding Board’s Rejection of Dissidents’ Nominees
In Kellner v. AIM ImmunoTech Inc., C.A. 2023-0879-LWW (Del. Ch. Dec. 28, 2023), the Delaware Court of Chancery upheld an incumbent board’s rejection of a group of dissidents’ nominees for a corporation’s 2023 annual meeting, finding that the dissidents failed to comply with the requirements of the corporation’s advance notice bylaws. Despite upholding the rejection of…