Category Archives: Commentary

Will the Loss of the Electric Vehicle Tax Credit Lead to the Demise of Tesla?

In a blog post written for the Delaware Journal of Corporate Law, DJCL Staff Member, Ryan Messina, discusses Tesla’s business challenges that result from a combination of the loss of the $7,500 electric vehicle tax credit, a civil investigation by the Securities and Exchange Commission, a shareholder derivative action alleging breach of the fiduciary duty of loyalty, and its mountain of long-term debt.  Time will tell how these challenges will impact Tesla as one of the world’s most innovative companies, in executing its goals and remaining viable.

Read Ryan’s post on the DJCL Blog.

Discovery Facilitators

Delaware courts should consider requiring parties to use discovery facilitators to streamline the ligation process.  Recently, the Delaware Court of Chancery opted to do so. In a blog post written for the Delaware Journal of Corporate Law, DJCL Staff member, Alexandria Crouthamel, explains that this person is often a special master who is a lawyer that specializes in the area of law being litigated, but currently, there is no rule in Delaware stating who can or should be a discovery facilitator.  An issue to resolve is who will bear the cost for discovery facilitators, but given the heavy caseloads in the courts, this may be a viable option to help streamline the litigation process.

Read Alexandria’s post on the DJCL Blog.


Annual Review of Key Delaware Corporate and Commercial Decisions

In a blog post written for the Delaware Journal of Corporate Law, Francis Pileggi, graduate of Widener University Delaware Law School, former Internal Managing Editor of the Delaware Journal of Corporate Law, and presently the managing member of the Wilmington, Delaware office of Eckert Seamans Cherin & Mellot, LLC, provides his twelfth annual list of key Delaware corporate and commercial decisions by selecting and reviewing eleven cases he considers to be of widespread interest to those who engage in corporate and commercial litigation in Delaware, or to those who follow the latest developments in this area of law.

Read Mr. Pileggi’s post on the DJCL Blog.

Does the Equitable Mootness Doctrine Apply to Appeals from Chapter 7 Liquidations?

In a blog post written for the Delaware Journal of Corporate Law, DJCL Articles Editor Jennifer Penberthy Buckley discusses In re Nica, from the United States Court of Appeals for the Eleventh Circuit, which assessed an equitable mootness claim in the context of an appeal from a Chapter 7 liquidation. Given the traditional use of equitable mootness in the context of an appeal from confirmation of a Chapter 11 plan, the Court acknowledged that the applicability of equitable mootness to Chapter 7 appeals is questionable. This post briefly examines the policy justifications for the equitable mootness doctrine and argues that it could apply to Chapter 7 appeals in some cases.

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Section 141(k) Mandatory Prohibition of For-Cause Removal of a Declassified Board

In a blog post written for the Delaware Journal of Corporate Law, DJCL Staff Member Kendra Rodwell discusses the Delaware Court of Chancery ruling that Delaware corporations with provisions in their corporation’s bylaws and charters directly conflicting with Delaware law would be stuck down.  In In re Vaalco Energy Shareholder Litigation, the Court of Chancery was asked to determine whether the Vaalco Energy’s provision that made directors of a non-classified board removable only for cause was valid in light of DJCL section 141(k) that required non-classified boards to be removed without cause.


One of These Things is Not Like the Other: Student Bar Loan Distinguished from Traditionally Nondischargeable Student Loan Debt

In a blog post written for the Delaware Journal of Corporate Law, DJCL Articles Editor Kaitlin E. Maloney analyzes a recent decision from the U.S. Bankruptcy Court for the Eastern District of New York.  In Campbell v. Citibank, the court distinguished a law school graduate’s bar loan from other nondischargeable student loan debt, and ruled that the bar loan was dischargeable in bankruptcy.  Though some believe that this will discourage lending institutions from extending bar loans to law students, Kaitlin argues that is unlikely due to the relatively low risk these loans present to lenders.


Applying Omnicare and Protecting Investors Under § 11 of the ‘33 Act

In a blog post written for the Delaware Journal of Corporate Law, DJCL Senior Staff Member Nicholas D. Picollelli, Jr. discusses how the Second Circuit’s recent decision in Tongue v. Sanofi is the most recent attempt to apply the U.S. Supreme Court’s Omnicare standard regarding § 11 of the Securities Act of 1933. Under specific circumstances, Omnicare expands § 11 liability to include omissions of fact relating to statements of opinion in a registration statement. The Omnicare standard and the Second Circuit’s application present issuers with a unique choice – costly drafting fees or potentially extravagant litigation.


EZCorp Deems Entire Fairness Standard Appropriate When Controlling Shareholder Receives Non-Ratable Benefits

In In re EZCorp, the Court of Chancery grappled with the appropriate standard of review for business transactions between a company and a controlling shareholder.  In a blog post written for the Delaware Journal of Corporate Law, DJCL Senior Staff member Helene Episcopo explains that the court  determined that the entire fairness standard of review was appropriate, and that it declined to apply Aronson beyond the demand futility context.


In Re Trulia, Inc. Stockholder Litigation: End to Disclosure Settlements?

In a blog post written for the Delaware Journal of Corporate Law, DJCL Senior Staff Member Erin Rogers discusses the Court of Chancery’s recent decision in In Re Trulia, Inc. Stockholder Litigation, and the effect decision will have on the future quantity of disclosure settlements and merger related litigation.  She argues that while the heightened standard for disclosure settlements set out in Trulia will certainly decrease the number of disclosure settlements and decrease the amount of merger related litigation, the extent of the decrease will depend on a number of factors discussed in the article.


Puerto Rican Debt Crisis: A Proposal to Amend Federal Bankruptcy Law

Puerto Rico owes approximately 72 billion dollars to its creditors. Although the island is a United States territory, it is not considered a state for purposes of filing for Chapter 9 municipal bankruptcy. Although there have been several proposals to try to help Puerto Rico climb out of its debt, without amending the federal bankruptcy law to include Puerto Rico as a state for purposes of Chapter 9, the United States territory will collapse. In a blog written for the Delaware Journal of Corporate Law, DJCL Copy Editor Ashley DiLiberto argues that Puerto Rico deserves equal protection of the laws enjoyed by the several states; to hold otherwise reeks of discrimination and bias to our island brothers and sisters.