Massachusetts: A Compelling Alternative for Public Companies Considering Dexit

Delaware is the most common jurisdiction for public corporations and benefits from well-developed case law and a legislature that annually revises the corporate statute. The Delaware Chancery Court, however, often appears to view plaintiff firms as a constituency. A company may spend considerable time and money bogged down in frivolous litigation related to a transaction that is clearly in shareholder interest or may settle weak claims to avoid the cost of defense. Furthermore, a few recent Delaware decisions have included impractical or questionable substantive conclusions. Several corporations have migrated out of Delaware, and a number of others are evaluating that step. Many companies evaluate Nevada or Texas, although case law in their business courts is relatively limited. This memorandum, however, outlines factors relevant to considering Massachusetts as a potential jurisdiction. Massachusetts lacks a reputation as a “zero liability” regime. Such a reputation, whether or not valid, informs some stockholder antipathy toward Nevada and Texas.

Real the full memo.