Key Delaware Corporate & Commercial Decisions Of 2025

This is the 21st edition of Francis Pileggi's Annual Review of Key Delaware Corporate and Commercial Decisions of the Delaware Supreme Court and the Delaware Court of Chancery. This list does not attempt to include all important decisions of those courts that were rendered in 2025, and it eschews selected cases already extensively discussed by the mainstream press or legal trade publications.

Below, we highlight 23 of the notable decisions that will be of widespread interest to those involved in corporate and commercial litigation or those who follow the latest developments in this area of Delaware law. Some decisions provide useful practice tips about the nuances of procedural rules, and other rulings provide deep insights into the public policy and doctrinal underpinnings of important concepts, such as fiduciary duties and statutory summary proceedings seeking corporate dissolution or a determination of proper board membership.

Each title below links to a longer summary for each case, including a link to the actual decision, on Mr. Pileggi's Delaware Corporate and Commercial Litigation Blog.

Delaware Supreme Court Reinstates Musk's Tesla Compensation Package

The Delaware Supreme Court recently reinstated the compensation package that Tesla awarded to Elon Musk and that the Delaware Court of Chancery invalidated in two separate prior rulings, in the matter styled In re Tesla, Inc. Derivative Litigation, No. 534, 2024 (Del. Dec. 19, 2025). As one might expect, commentary about this ruling has already been extensive in the short time since the decision was handed down. A representative sample of the many articles in legal publications and the mainstream press is a recent Wall Street Journal editorial.

I typically eschew writing about decisions that have already been the subject of voluminous public discussion, so for this opinion I will simply provide my pithy insights regarding what I think are its most noteworthy attributes.

The most consequential aspect of this decision is the result, as compared to the reasoning. Delaware's High Court did not find that the Chancellor was wrong in deciding that the compensation package did not satisfy the standard of review for alleged breaches of fiduciary duty called the entire fairness test. Instead, the Court found it would be "inequitable" not to pay Musk for the six years covered by the compensation package during which he performed the work required of him.

The most notable part of the Supreme Court's reasoning was that rescission was not an appropriate remedy because the parties could not be returned to their respective positions as they existed before the litigation started—if the compensation package was denied to Musk. For example, the period of time that the compensation package covered had already expired.

Delaware Supreme Court Clarifies Requirements for Aiding and Abetting Claim

This Delaware Supreme Court decision addressing the nuances and subtleties of a claim for aiding and abetting a breach of fiduciary duty is required reading for corporate and commercial litigators. In the matter styled In re Columbia Pipeline Group, Inc. Merger Litigation, No. 281, 2024 (Del. June 17, 2025), the en banc High Court, in a 100-page decision, analyzed the multi-faceted aspects of a challenged transaction.

Delaware Supreme Court Addresses Fraudulent Concealment and Indemnification in Post-Closing Dispute

The Delaware Supreme Court provided useful clarification regarding when a fraudulent concealment claim tolls the statute of limitations for indemnification claims, in LGM Holdings, LLC v. Gideon Schurder, et al., No. 314, 2024 (Del. Apr. 22, 2025).

The High Court explained that when contract interpretation is at issue, the trial court may not grant a motion to dismiss when there is more than one reasonable interpretation.

The Supreme Court also instructed that when additional support for a key argument made at the trial level is presented for the first time on appeal, that additional support is not waived even if not presented to the trial court.

Delaware High Court: Suit Over TripAdvisor's Del.-to-Nev. Charter Move Should Have Been Dismissed

The Delaware Supreme Court reversed a Chancery decision to let shareholders of TripAdvisor Inc. and its parent continue their suit against their directors over their boards' reincorporation of the world's largest travel guidance purveyor in Nevada—which offers directors a higher level of protection from investor suits than Delaware, in Maffei v. Palkon, No. 125, 2024 (Del. Feb. 4, 2025).

Justice Karen Valihura, writing for the en banc court, said the increased protection from breach-of-duty charges the directors and officers received through the conversion's charter change did not give them a unique "non-ratable" benefit that could have skewed their objective judgment and made the board's decision reviewable under the enhanced scrutiny of entire fairness—as the Court of Chancery had ruled in allowing the plaintiffs to press their suit.

Delaware Supreme Court Suggests that Some Forfeiture-for-Competition Provisions May be Reviewed for Reasonableness

In LKQ Corp. v. Rutledge, 337 A.3d 1215 (Del. 2024), the Delaware Supreme Court responded to questions certified by the United States Court of Appeals for the Seventh Circuit by confirming that the Delaware High Court's ruling in Cantor Fitzgerald, L.P. v. Ainslie, 312 A.3d 674 (Del. 2024)—that forfeiture-for-competition provisions are not reviewed for reasonableness—was not limited to provisions in limited partnership agreements. While the Court's decision itself may not be surprising, it is notable for two reasons.

First, the Supreme Court held that "[i]t may be the case that a forfeiture-for-competition provision which required a claw back is so extreme in duration and financial hardship that it precludes employee choice by an unsophisticated party and should be reviewed for reasonableness," thus leaving open the possibility that Ainslie may not apply to every forfeiture-for-competition provision. The Supreme Court did not expand on its holding, citing Court rules which limit responses to certified questions to addressing "issues of law based on stipulated facts."

Second, the LKQ decision provided a helpful and concise summary of the current state of forfeiture-for-compensation provisions.

Chancery Recites Fundamental Case Management Principles

For those litigators who toil in the vineyards of pre-trial disputes over case management and positioning issues for trial, a recent Chancery ruling is a useful tool that deserves a place in the litigator's toolbox. The letter ruling, captioned as In re Northwest Biotherapeutics, Inc. Stockholder Litigation, Cons. C.A. No. 2022-0193-JTL (Del. Ch. Feb. 14, 2025), addresses fundamental principles that govern all litigation and pre-trial proceedings to ensure that litigation is guided by the most efficient procedures to present the issues in a manner that minimizes unnecessary delay and expense. This decision also provides citations to authorities and learned commentary that provide guideposts and standards that can be applied in almost every case.

Chancery Assesses Damages for Unfair Valuation

This Delaware Court of Chancery decision is a treasure trove of first principles applicable to corporate litigation. In Ban v. Manheim, C.A. No. 2022-0768-JTL (Del. Ch. May 19, 2025), the 69-page post-trial opinion applies an exemplary legal analysis to a complex web of entities controlled by one person, to explain why the valuation of a minority interest failed the entire fairness test—and what the applicable measure of damages requires in the form of a remedy.

The Court begins by explaining that DGCL § 202(b) bars the restriction of shares without the consent of the shareholder. For this reason, the attempted restrictions via a bylaw amendment on shares was a statutorily invalid act. The Court emphasized that DGCL § 109, which provides for authority to amend bylaws, does not supersede the condition to imposing a restriction on shares in Section 202(b).

Chancery Stings with Finding of Breach of the Fiduciary Duty of Candor—A Cautionary Tale

This Delaware Court of Chancery decision is noteworthy for its deep dive into the doctrinal underpinnings of the various aspects of fiduciary duties, as well as the difference between the standard of conduct and the standard of review. But my favorite part of the opinion is its discussion of the nuances of the duty of candor. This core duty receives less attention in most corporate decisions than the other aspects of fiduciary duty. In Leo Investments Hong Kong Limited v. Tomales Bay Capital Anduril III, L.P., C.A. No 2022-0175-JTL (Del. Ch. June 30, 2025), the Court determined that even though there was a breach of the fiduciary duty of candor, because no damages were proven, nominal damages of $1 were awarded.

The real damage done to the defendant was reputational harm based on the Court's finding, and I paraphrase, that the defendant fund manager was not forthright with his investment partner. The Court even went so far as to suggest, and I paraphrase, that because of his "callous" conduct in this case, future investors should "think twice" about future investments with the defendant fund manager. Ouch.

Chancery Declines to Appoint Receiver for Dissolved LLC

The Delaware Court of Chancery provided a nuanced analysis to explain its reasoning for not appointing a receiver for a cancelled LLC, in PXP Producing Co. LLC v. MitEnergy Upstream LLC, C.A. No. 2024-0668-MTZ (Del. Ch. June 26, 2025). The complaint also sought nullification of the cancellation on the grounds that the company violated Section 18-804 of the Delaware LLC Act by dissolving without making any provision for specified obligations which, the petitioner argued, made the cancellation unlawful under Section 18-203. The Court discussed whether the claims were time barred under 10 Del. C. Section 8106, and also denied a motion to intervene.

Chancery Explains Nuances of § 273 Dissolution Requirements

The Delaware Court of Chancery regales the reader with a gem for those seeking the latest iteration of Delaware law on the requirements of DGCL § 273 regarding judicial dissolution of a joint venture corporation. In the matter styled In Re Petition for Dissolution of M7 Energy Development Corporation and Convergent Innovation Technology Holdings, Inc., C.A. No. 2024-1135-MTZ (Del. Ch. Aug. 26, 2025), the Court explained in the first paragraph why it was denying the requested relief, as follows: "In short, the petitioners have more work to do."

In sum, the Court rejected the request for a judicial dissolution of two joint venture corporations for a variety of reasons. For example:

The Court provides extensive citations to Delaware decisions as well as to the leading Delaware corporate treatises to support its reasoning why the requirements of § 273 are conjunctive—not disjunctive.

The Court explains why the statute requires an actual disagreement on both: (i) the act of dissolution, as well as (ii) the disposition of assets.

Chancery Determines Proper Board Membership in § 225 Action

The Delaware Court of Chancery recently determined the proper composition of a board in a proceeding under DGCL § 225 styled as Rainbow Mountain Inc. v. Begeman, C.A. No. 2018-0403-PAF (Del. Ch. Aug. 25, 2025).

This case involved a dispute among five siblings and their extended family over the management and ownership of the Virginia real estate they inherited. The litigation of this internecine dispute has spanned more than two decades, with lawsuits in Delaware and Virginia. See footnote 8. The corporation involved was a nonstock corporation.

There is no separate Delaware statute for nonstock corporations. Instead, DGCL § 114 is a "translator" provision.

Chancery Explains Required Notice in Summary Proceeding to Determine LLC Managers

The Court of Chancery recently explained who must receive notice in order to satisfy the requirements of 6 Del. C. § 18-110, which provides a summary procedure for LLCs, similar to § 225 for corporations, to determine the proper manager of an LLC. In HREF Senior Worthington LLC v. Conroe WN LLC, C.A. No. 2024-1148-MTZ (Del. Ch. Oct. 2, 2025), the Court explained that one of the parties with a potential claim to the disputed office did not receive notice. The company at the center of the § 18-110 claim was never served with the complaint, and no other form of notice was distributed.

This letter ruling also provides a cornucopia of important principles and procedural requirements for § 18-110 cases.

Chancery Determines Proper Board Membership in the Context of Company Counsel Playing Key Role in Attempted Ouster

A recent Delaware Court of Chancery decision is noteworthy for several key principles applied to a set of facts that involve company counsel using corporate machinery and corporate funds to join with a faction of the board to oust a board member. Dalby v. Kastner, C.A. No. 2025-0136-NAC (Del. Ch. Aug. 29, 2025) is a 100-page post-trial decision in a Section 225 action that went to trial less than three months after the complaint was filed. It deserves careful review.

Many of the key facts in this decision raise important issues, but the narrow focus of the court's opinion in this Section 225 action was primarily to determine whether a board member was properly ousted. He was not.

Liquidating Trustee Appointed for LLC with Two 50-Percent-Members

Two equal owners of an LLC disagreed as to a liquidating trustee. One member filed this action seeking a trustee, in the matter styled In re Coral Gables Luxury Holdings, C.A. No. 2024-0977-KSJM (Del. Ch. May 9, 2025).

Despite the "practical appeal" of the arguments about how a related escrow agreement made it unnecessary to have a liquidating trustee, the Court held that "the reality is that the parties will have to agree to a liquidating trustee at some point to wind down the Company, and the LLC agreement entitles Shoma [Coral Gables LLC] to that much."

Chancery Addresses Issue of First Impression: Role of Counsel for a Two-Member Deadlocked Board

In a bench ruling, the Delaware Court of Chancery addressed an issue that it acknowledged had not been squarely decided by the Court in a prior published decision: corporate counsel's role and scope of engagement for a two-member deadlocked board. In Kundrun v. AMCI Group, LLC, C.A. No. 2025-0570-LM-JTL (Del. Ch. Oct. 22, 2025), in a transcript ruling and an Order encapsulating the decision, the court considered exceptions to a Magistrate's Final Report and held that counsel for the company must remain neutral as between the two equal owners of the LLC who also comprised the two-member board of directors.

Chancery Rejects Relevance of Personal Data About CEO

This Delaware Court of Chancery ruling addressed the scope of discovery in connection with a dispute about a failed merger to the extent that "deeply personal" and embarrassing information about a CEO was sought, purportedly in connection with the role the CEO played in the alleged failure of his company to use contractually mandated efforts to close the deal. Albertson Companies, Inc. v. The Kroger Co., C.A. No. 2024-1276-LWW (Del. Ch. Sept. 12, 2025), provides some insights that may be broadly applicable to other corporate and commercial cases generally.

As an aside, the court does not address the slightly different situation where irrelevant personal allegations are included in a complaint or in other court filings, and the court refuses to strike those public allegations. In that situation, much like dealing with a bully in a school yard, if one does not find suitable means to push back on that abusive behavior, it emboldens the bully.

Chancery Clarifies Requirements to Bar Claims Based on Extra-Contractual Statements

Helpful reminders about the requirements for limiting the ability to make claims based on extra-contractual statements are featured in the pithy letter ruling from the Court of Chancery in Park7 Student Housing LLC, v. PR III/Park7 SH Holdings, LLC, C.A. No. 2025-0167-MTZ (Del. Ch. June 20, 2025). The Court reiterates the well-established rules of the road that, when followed, prohibit claims based on statements outside the contract, or an asserted understanding, contrary to the terms of a contract—due to an integration clause.

More importantly, in the context of perennial post-closing disputes for the sale of a business, the Court explains that in order to bar a fraudulent inducement claim that relies on extra-contractual statements (as compared to an alleged promise of future conduct covered by the parole evidence rule), the written agreement must contain an explicit anti-reliance clause in addition to the integration clause.

Chancery Strikes Affirmative Defense of Fraudulent Inducement

The Court of Chancery recently provided a cornucopia of practical principles for corporate and commercial litigators. For example, the elements of a claim for fraud, which is the same in Delaware as fraudulent inducement, may be basic, but this letter ruling provides an exemplary restatement of the law.

IniSense, LLC v. Biomerieux, Inc., et al., C.A. No. 2023-1221-SKR (Del. Ch. Dec. 4, 2025), the decision also featured the somewhat unusual requirements for a successful motion to strike under Rule 12(f), which permits a party to strike a pleading for several reasons, including the one employed here: for "any insufficient defense." The Court referred to several other related lawsuits in Delaware among the parties involving a dispute over the licensing and sub-licensing of certain medical patents.

Chancery Bars Suit Against Officer Found Liable for Harassment by NY Court

The Delaware Court of Chancery recently barred Credit Glory Inc.'s president from bringing breach of fiduciary duty claims against an ex-officer/director of their credit aid company based on the same "abhorrent" sexual harassment conduct that caused his termination and $1.8 million in judgments against him and the company in New York courts. Brola v. Lundgren, C.A. No. 2024-1108-LWW (Del. Ch. Dec. 1, 2025).

The Court dismissed plaintiff Alex Brola's derivative suit, finding it seeks to extract a second recovery, "this time under the expansive theory of fiduciary duty". Brola argued that ex-officer/director Christopher Lundgren's actions were selfish, illegal, and thus a breach of the duty of loyalty.

But "Delaware law does not reach so far. The defendant's misconduct was interpersonal, not a matter of corporate internal affairs," the Vice Chancellor ruled. "After the New York court provided a remedy through the employment laws, this court cannot—and should not—supply a second one."

Chancery Interprets Delaware Rapid Arbitration Act

This Delaware Court of Chancery decision interpreted the Delaware Rapid Arbitration Act ("DRAA"), about which there is a relative paucity of published opinions. See OBI Pharma, Inc. v. Biosion, Inc., C.A. No. 2025-0965-KSJM (Del. Ch. Sept. 26, 2025).

This short letter ruling addressed an issue regarding the appointment of a panel of three arbitrators. An agreement between the parties required disputes to be resolved pursuant to arbitration under the DRAA,10 Del. C. § 5801, et seq. The relevant agreement did not provide a procedure for the selection of a panel of three arbitrators. Because the parties could not agree on who to select as arbitrators, they submitted a list of six arbitrators to the court, all of whom were qualified under § 5805(b) of the DRAA. The court picked three persons from that list.

Chancery Orders New Board Nominations as Equitable Relief

The Court held in Vejseli v. Duffy, C.A. No. 2025-0232-BWD (Del. Ch. May 21, 2025), that Ionic's directors breached their duties by reducing the size of the board as "an inequitable defensive measure" but that the board properly rejected Plaintiffs' nomination notice under the advance notice bylaw.

Despite Ionic's arguments, Court allowed Plaintiffs to re-nominate: "To restore the stockholders' ability to elect two Class I directors at Ionic's annual meeting, an injunction will issue directing the Board to reopen the ten-day nomination window under the advance notice bylaw to permit any Ionic stockholder to submit new director nominations."

Ambush Board Meeting Made Board Actions Voidable

In Ghatty, et al. v. Mudili, et al., C.A. No. 2025-0615-LWW (Del. Ch. Oct. 21, 2025), the Court of Chancery invalidated the removal of two directors at a surprise meeting held without proper notice. The Court emphasized that Delaware law does not tolerate ambush tactics or "Pearl Harbor-like plans" in corporate governance. Misleading notice renders resulting board actions voidable. A later offer to join virtually could not cure the lack of fair notice.

Claim Rejected Under Delaware Computer-Related Offenses Act

The Court of Chancery granted a motion to dismiss a counterclaim asserting a statutory computer-related tort under the Delaware Computer Related Offenses Act, in Sarwal v. Nephrosant, Inc., C.A. No. 2023-0222-BWD (Del. Ch. Aug. 28, 2025).

Although the counterclaim alleged extensive downloading and deletion of company documents, the Court held that the statute did not reasonably apply to the alleged conduct—for example, the actions all took place outside of Delaware. The Court emphasized the limits of the Act and declined to extend it to disputes better addressed through traditional fiduciary or contractual claims. Accordingly, the statutory claim was dismissed for failure to state a claim.

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