September 16, 2019

September 16, 2019

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Was 2018 The Apogee Of Delaware's Corporate Hegemony?

Professor Mohsen Manesh cites two developments in 2018 as a possible turning point for the internal affairs doctrine: California's enactment of a board gender quota law and Vice Chancellor Laster's ruling in Sciabacucchi v. Salzberg, C.A. 2017-0931 JTL (Del. Ch. Dec. 19, 2018).  He finds:

"Although seemingly unrelated, both events share at their core a challenge to the internal affairs doctrine—a doctrine that is at the foundation of the state-based system of corporate law in the United States."

The Contested Edges of Internal Affairs (forthcoming).  Professor Manesh concludes with this less than sanguinary prognostication of the future of Delaware's hegemony:

"But recent events suggest that this unrivaled power may be unraveling at the edges. The boundaries of the internal affairs doctrine are now the subject of dispute, and additional challenges are likely to surface.  As other states seek to contest the scope of the internal affairs doctrine, restricting and expanding its reach, Delaware confronts a new threat to its lucrative regulatory domain, and corporate America faces a fundamentally altered regulatory landscape."

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About this Author

Keith Paul Bishop, Corporate Transactions Lawyer, finance securities attorney, Allen Matkins Law Firm
Partner

Keith Paul Bishop is a partner in Allen Matkins' Corporate and Securities practice group, and works out of the Orange County office. He represents clients in a wide range of corporate transactions, including public and private securities offerings of debt and equity, mergers and acquisitions, proxy contests and tender offers, corporate governance matters and federal and state securities laws (including the Sarbanes-Oxley Act of 2002 and the Dodd-Frank Act), investment adviser, financial services regulation, and California administrative law. He regularly advises clients...

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