Various contracts stipulate where disputes will be decided.
Chancery court is in fact a thing.
DWAC up 18% on this news
Venue in California or TX would also likely be appropriate if the contract didn’t say, but I gaurentee the contract says Delaware law and venue apply. Delaware is popular for corporate disputes because it has a broad and deep body of law, precedent, and expertise. If the case were in Wyoming or West Virginia it would be (more of) a clusterfuck.
In terms of enforcing out of state decisions, see full faith and credit clause of the constitution.
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It could still be chicanery, but there is a chancery Elon wins and a chancery he loses
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Do you even Dickens?
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Court of chancery is perfect for Elon.
IANAL and I don’t know much but this is something I read on a Finnish corporate watch organization’s publication about platform economy. It’s google translated so it ain’t 100% accurate but you get the gist. Is Delaware a tax haven?
After Ireland prevented the use of the Double Irish tax arrangement, Airbnb initiated a reorganization of its group structure in 2019. In the first phase of the reorganization, the intangible assets essential for income generation were transferred at the end of 2019 from the Irish-Jersey Airbnb International Unlimited Company to the balance sheet of Airbnb Ireland Unlimited Company, which carries out operational business. After this, the aforementioned operational Irish company was transferred to the ownership of Airbnb Global Holdings Inc., established in Delaware, and the companies previously part of the chain of ownership (Airbnb International Unlimited Company, Airbnb International Holdings Limited and Airbnb 1 Unlimited) were terminated. At the end of the multi-stage arrangement, the intangible rights were transferred to the Delaware parent company of Airbnb Ireland Unlimited Company.106 Delaware is also the place of registration of the group’s supreme parent company, Airbnb Inc., which was listed at the end of 2020, although its headquarters are located in California. In addition, the group has more than 20 other subsidiaries in Delaware. The state of Delaware is known as the US’s own tax haven, which attracts companies to its territory with low corporate taxation and corporate laws that guarantee anonymity. It is possible to register a company in Delaware, even if it does not actually have any activity in the state. In this case, the company is completely exempt from paying the state corporation tax.107 Income related to intangible rights is, on the other hand, exempt from corporate taxation, even if the company has business in the state.Therefore, only federal taxes are paid on the income generated by the intangible property transferred to Delaware. Due to the FDII regulations included in the Tax Cuts and Jobs Act approved by President Donald Trump in 2017, they too remain significantly lower than the normal federal corporate tax109.
The Delaware thing is not to save on tax, it’s for predictability. Their courts have smart judges and a long line of cases outlining exactly what the rules are. Also they’re generally very management/board friendly.
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Why has Delaware, with it’s enormous size and population, become a state of “broad and deep body of law, precedent, and expertise?” In my line of work I’ve come to conclusion that if somewhere’s a concentration of lolawyers there’s shenanigans. I might be wrong and the publication above might be wrong but I’m willing to change my heuristics and be enlightened.
There are some US legal practices that contribute to tax evasion, but for individuals, not big MNEs. Double Dutch/Irish/etc structures and things like that don’t have anything to do with the US state where the parent is located.
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How is Trump getting unbanned now?
30% at its peak. I’m going to have a hard time not buying some puts if it keeps going. I think the odds of them actually completing the merger are <20%.
Everyone involved is an absolute scumbag and they certainly committed fraud. They engaged in conversations with Trump prior to the SPAC IPO which is on the short list of things that somehow matters (maybe?).
shortly before this post
Beetlejuice:
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I’m thinking this is a good time to take a flyer on some twitter shares. Seems like “no merger” is already priced in and this court has a decent chance to make a strong ruling in TWTRs favor. I could easily see them being forced to close with Muck being given some small concession.
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In addition to the body of law and expertise, Delaware offers some benefits for things like director privacy and immunity from personal suit, and probably some tax benefits, and everything kinda worked together to create a positive feedback loop. It’s not my area of expertise, but it should be possible to find some law review and history articles will all the relevant details.
NV and WY are two of the preferred tax havens, and Del. likely has some real benefits. The US has had a race to the bottom re corporate registration, with some states behaving like shitty foreign countries, which 60 Minutes did a piece on about a year ago.
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Gonna be a lot of shocked pikachus when Musk ends up settling for a pittance that is way less than a billion.
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