TransPerfect’s owners took a couple of parting shots in formally announcing that the company will change its incorporation to Nevada.
The change from Delaware incorporation status became effective on Aug. 6.
The company’s headquarters will remain in New York City. TransPerfect has no physical presence in Delaware. Total employment is 4,000.
Owners of TransPerfect were locked in a nearly four-year-long legal battle over control of the company, with former couple Phil Shaw owning 49 percent, his mother Shirley Shawe owning 1 percent and Elizabeth Elting having a 50 percent stake.
Price tag of the dispute for a company with less than $650 million a year in sales was estimated by one source at a quarter of a billion dollars.
The release stated that “Phil Shawe was forced to compete in an auction to retain the company he co-founded and co-owned, while simultaneously contesting its legality and constitutionality. Shawe prevailed in that auction and successfully gained ownership and full control of the company, allowing it to move forward under its existing and unified management team. However, the litigation was protracted, disruptive to TransPerfect employees, and costly to both the company and its co-founders. Many believe that the unprecedented manner in which the Chancery Court handled the case was a key factor in Delaware plummeting from its #1 ranking in the U.S. Chamber of Commerce business litigation survey to #11.”
Phil Shawe offered the following in the release. “For many years, most companies, including ours, considered Delaware the default option for incorporation. But times and circumstances have changed. Other states, Nevada chief among them, now represent compelling alternatives.”
“The expense burden some jurisdictions place on resident companies through overly high litigation costs is simply staggering; our situation in Delaware was a perfect example,” Shirley Shawe stated in the press release. “Without significant legislative reform, I would not be surprised if TransPerfect’s ‘Dexit’ becomes part of a larger trend.” She went on to say, “Nevada has a reputation for a rational and predictable judiciary, as well as one that operates with lower litigation costs and promotes settlements.”
