The Delaware Supreme Court has reversed a ruling by the Chancery Court regarding TripAdvisor, stating that no fairness review is necessary for companies seeking to move their incorporation out of Delaware to states like Nevada. This decision applies the business judgment rule to reincorporation, indicating that companies can make such moves without facing liability. The ruling is seen as a significant development for businesses considering relocation, as it eases the path for companies to leave Delaware. In light of this ruling, Delaware's governor is also contemplating changes to the state's business dispute resolution processes, aiming to enhance the system based on feedback from corporate executives and legal professionals. The trend of companies relocating from Delaware to states like Nevada and Texas is increasing, with notable examples including TripAdvisor and Tesla.
https://t.co/w6xvKY7Z9J relocates headquarters from Silicon Valley to Austin https://t.co/Ql784kFCqP
https://t.co/F1iIgWRTjv announced on Thursday the relocation of its corporate headquarters to Austin, Texas from Santa Clara, Calif. https://t.co/7SuITsmO9N
I constantly have Delaware plaintiffs’ lawyers complaining that I’m scrutinizing the Chancery judges too much and you know what? They’re absolutely right. I should be scrutinizing them.