In the guest post, John discusses the recurring issues that have led high-profile companies in Delaware to take steps to reincorporate in other states over perceived unfairness in Chancery Court decisions. John highlights “hybrid direct/derivative actions, “Caremark claims,” “corporate indemnification for derivative settlements,” and “proposed legislative curbs to plaintiff attorneys’ fees” as recurring issues that have frustrated D&O insurers who insure D&O Chancery Court litigation.

John also emphasizes that newly formed companies still have an incentive to incorporate in Delaware given then state “confers a kind of imprimatur of quality and consistency that new companies seek to convey to their shareholders,” but more mature companies who have established themselves “no longer need the Delaware imprimatur to attract investors and trading partners” and have begun to perceive the Chancery Court’s jurisprudence as “imposing increasingly constrictive leashes” on the ability to “take advantage of complex or creative business opportunities.” Read the article.