Delaware corporations contemplating conversion to another state should take note of a recent Delaware Court of Chancery decision in which Vice Chancellor J. Travis Laster declined to enjoin a corporate move to Nevada, but sustained stockholder allegations that the defendants breached their fiduciary duties in connection with approving the conversion.
On February 20, 2024, Vice Chancellor Laster held that two entities – TripAdvisor Inc. (TripAdvisor) and Liberty TripAdvisor Holdings Inc. (Holdings) – may move forward with their respective conversions into Nevada corporations, dealing a blow to the plaintiffs’ hopes of keeping the corporations in Delaware. However, the breach of fiduciary duty claims challenging each board’s decision to approve the conversion will continue, with a potential for monetary damages for any harm suffered by stockholders.
The court held that the decisions to approve the conversions were subject to entire fairness review because both…