Dean Sattler

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On May 5, 2026, the U.S. Securities and Exchange Commission (“SEC”) proposed rule and form amendments that would give public companies the option of filing semiannual reports in lieu of quarterly reports to meet their periodic reporting obligations under the federal securities laws (the “Proposed Amendments”). If adopted, the Proposed Amendments would represent a significant shift in the periodic reporting framework for public companies, reflecting the SEC’s current focus on reducing regulatory burdens on public companies while maintaining investor protections and providing the flexibility to determine the periodic reporting frequency that best serves the company and its stockholders.
Continue Reading SEC Proposes Amendments to Permit Optional Semiannual Reporting by Public Companies

In its recent decision in Manti Holdings, LLC v. The Carlyle Group Inc., C.A. No. 2020-0657-SG (Del. Ch. Jan. 7, 2025), the Delaware Court of Chancery reaffirmed the high bar plaintiffs must meet to show that a private equity fund’s motivation to complete the sale of a portfolio company prior to the end of the fund’s life creates a problematic conflict of interest.
Continue Reading Delaware Court of Chancery Clarifies Controller Transaction Conflict of Interest Rules

Public companies would be well advised, on a lovely, clear day (in the Delaware sense), to update their advance notice bylaws. In the normal course these bylaws receive little attention, but in the event of an activist campaign they are critical to the board’s ability to discharge its fiduciary duties.  The board will have a positive duty to inform itself, among other things, of the activist’s plans and proposals, the degree of the activist’s financial alignment with long-only stockholders, and the qualifications and independence of the activist’s nominees.  This information will inform any settlement discussions, support a recommendation for or against the activist’s nominee and allow the board to ensure that stockholders receive accurate and timely disclosure regarding the nomination.
Continue Reading Alignment Advance Notice Bylaw

The Delaware Supreme Court in Kellner v. Aim Immunotech[1]recently ruled on the enforceability of a “modern” set of advance notice bylaws. Advance notice bylaws are the key tool corporations have to regulate the director nomination process and ensure full and fair disclosure to stockholders in a proxy fight. Critically, advance notice bylaws also allow the board to gather information necessary to guide its recommendation for or against a nominated candidate. While the headline may be that the court found all the challenged bylaws to be unenforceable, looking at each bylaw individually reveals a much less discouraging picture for corporations.[2]
Continue Reading Delaware Supreme Court Ruling on Advance Notice Bylaws – What’s In, What’s Out and What’s Missing from Advance Notice Bylaws

Summary

Founders and controlling stockholders often seek to retain control over their companies even after taking them public, typically via high-vote share classes or, as was at issue in this case, via stockholder agreements granting the pre-IPO owners broad governance rights.

In West Palm Beach Firefighters’ Pension Fund v. Moelis & Company, the Delaware Court of Chancery recently held that a “new wave” stockholder agreement between Moelis & Company (the “Company”) and its founder, CEO, and board chairman, Ken Moelis was invalid under Section 141(a) of the Delaware General Corporation Law (the “DGCL”) because it contained  “pre-approval rights” over a number of corporate actions, required the board to recommend individuals designated by Moelis for a majority of directorships and fill committee positions and board vacancies with Moelis designees, impermissibly constraining the board’s ability to manage the business and affairs of the company—powers the statute does not allow the board to delegate via contract.[1]

Moelis is a strong reminder that the foundation of the corporate form in Delaware is the independent authority of a board of directors, elected by stockholders and entrusted to manage the business and affairs of the corporation as fiduciaries. Delaware will not permit this foundation to be eroded through contractual arrangements with stockholders.
Continue Reading Delaware Court of Chancery Rejects Validity of “New Wave” Stockholder Agreement Terms that Constrain Traditional Board Authority

On May 12, 2023, the Delaware Court of Chancery reaffirmed a key principle for transactions involving interested directors: process is everything. Vice Chancellor Sam Glasscock III, in his opinion in In re Oracle Corporation Derivative Litigation, provides reassurance that the Court will not rush to second-guess board decisions involving conflicted transactions as long as adequate safeguards are present.

Continue Reading Delaware Chancery Court Finds for Defendant Director, CTO and Founder of Oracle, Larry Ellison, in Derivative Suit Involving Conflicted Transaction