Shifting the Focus: Let the Courts Decide
Bank and Corporate Governance Law Reporter, Volume 53, Number 5, 2015
5 Pages Posted: 15 Mar 2015
Date Written: January 1, 2015
The frenzy over fee-shifting bylaws and charter provisions is no surprise. Anything that addresses the economics of the game so directly is cause for either alarm or implementation, depending on the side of the caption. And in a world where intracorporate litigation is ubiquitous, and very profitable even though far more derivative and class suits lose than win, no change in substantive law would have quite the bite. In our view, however, the calls to resolve the fee-shifting debate by legislative fiat are misguided. The Delaware courts should be allowed to do what only they can: address the propriety of fee-shifting provisions carefully, contextually, and incrementally.
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