My take: A Delaware newsletter makes sense of the Twitter whirlwind and Chancery Court

247
Advertisement

Chancery Court has emerged as a  hot topic in corporate law circles following the lawsuit filed by Twitter after Tesla CEO Elon Musk sped away from a $44 billion buyout.

Story after story outlined the history and significance of the court – one of our holdovers from the  English legal system. It handles civil matters ranging from guardianships to neighborhood disputes. Rulings are typically made by the chancellor or vice chancellor rather than a jury.

For a time, there was a lot of speculation about the court among out-of-town pundits, some of whom did not have the foggiest idea of how the court functions.

It was suggested that lengthy delays would come, especially when Musk’s legal team requested a February timeframe The Pundits were wrong. The proceedings get underway in  October.

After all, Chancery Court remains relevant because companies that incorporate in Delaware know disputes will be handled without major delays. The state invests heavily in the court, although hefty pay in corporate law and other factors have increased turnover.

Advertisement

The Wall Street jumped in with a  profile of Chancellor Kathaleen S.J. McCormick that those of us in the local media never got around to doing. Chancellors rarely do interviews, and this story was no exception.

We learned that McCormick works hard, has skills in sorting through complex corporate issues, and started out as a legal aid attorney. She grew up in Smyrna before graduating from Harvard and Notre Dame Law School. (She’s a Fighting Irish fan).  The S.J. initials are short for  St. Jude (the patron saint for those in need of hope). The name was given because she was born prematurely, and her mother worried about her health.

Profiles are nice, those following the Twitter case are looking for breaking developments.

They have found a reliable source in Chancery Daily, a subscription newsletter that takes a deep dive into the intricacies of Chancery Court cases and rulings.

Chancery Daily has expanded its coverage of the case via, you guessed it, Twitter.

Its increasingly popular Twitter page picked up on the flurry of subpoenas generated by the social media company’s legal team, added some links to filings, and had some fun along the way. (See above)

This week, Chancery Daily took a look at a recommendation by a Chancery Master in a specific performance case involving a little-noticed disputed land sale in the Smyrna area. The master is a member of Chancery who handles some disputed matters.

Specific performance (following through on a previous agreement) lies at the heart of the Twitter suit. Musk claims he can walk away from the signed  Twitter deal because it provided fraudulent information on “bots” that automatically tweet and inflate traffic on the site.

Does the Smyrna case that determined the buyer did not have grounds for seeking damages from the seller for delays in the deal,  have any bearing on the court’s views on specific performance?

Chancery Daily would not offer an opinion but pointed out that those following the Twitter saga will be on the lookout for clues. –Doug Rainey, chief content officer.

 

Advertisement
Advertisement