Del. Ruling Clarifies Public Benefit Corp. Fiduciary Duties
August 27, 2026
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In Drakes Landing Associates LP v. Tilden Park Capital Management LP, the Delaware Court of Chancery provided landmark guidance for practitioners and directors of Delaware public benefit corporations on the fiduciary duties owed by PBC directors and the statutory protections applicable to their decisions.
The July 29 decision squarely addressed, for the first time in a written decision, the fiduciary duties and standards of review applicable to PBC directors in a change-of-control transaction, holding that they are not subject to traditional Revlon duties — derived from the Delaware Supreme Court’s 1986 ruling in Revlon Inc. v. MacAndrews & Forbes Holdings Inc. — and are instead obligated to consider a broader set of constituencies beyond the stockholder value.
The decision also provided guidance on the scope of protections offered by Delaware’s new statutory safe harbor in amended Section 144 of the Delaware General Corporation Law, or DGCL, in change-of-control transactions, with relevance expanding beyond the PBC context.