Cloudflare’s appeal won’t fix what’s broken in Delaware’s Chancery Court
Source: Fortune ·
A vice chancellor, Travis Laster, sent his own ruling to the state Supreme Court. Boards shouldn’t read that as reassurance.
From the source
The morning after we wrote in Fortune about a controversial Chancery Court decision involving Cloudflare, Vice Chancellor J. Travis Laster moved with uncommon speed to certify an interlocutory appeal of his ruling to the Delaware Supreme Court. Corporate boards might read that as a sign the system is correcting itself. They shouldn’t, at least not yet. The appeal was necessary because Laster used an unusually expansive reading of “good faith” to enjoin the Cloudflare board’s decision about its capital structure. A vague standard With corporate anchoring fees rivaling personal income taxes as Delaware’s primary source of revenue, Delaware’s wise leaders, including its governor and its legislature, saw this exodus coming, and tried to stem its root cause. In March 2025, Delaware passed Senate Bill 21 (SB 21), the most significant rewrite of its corporate code in a generation, to stop the flow of companies out of the state. SB 21 was generally recognized to have been a direct response…
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