By Jordan Lee
Wilmington, DE – September 15, 2025
Delaware’s top court got new help this week. Three groups filed amicus briefs. They back the state’s new safe harbor rules. These rules came from Senate Bill 21. The bill passed in March. It changes how companies handle deals with bosses or big owners. Now, a key case tests if the law is okay.
The case is Rutledge v. The Boeing Company. It is in the Delaware Supreme Court. Two questions went up from Chancery Court. They ask if the law follows the state rules. The safe harbors protect directors and officers. They also cover controlling stockholders. These are people or groups with big power in a company. The rules say if they follow steps, courts treat deals as fair. No big review needed.
Senate Bill 21 fixes old problems. Before, some deals got strict looks. Even if no one fought them. The law adds clear paths. For example, in deals where a controller buys out others. Or sells to the company. If a special committee works and no one votes against, it gets safe harbor. The same for director deals. Like loans or jobs. If the board approves and shares info, it is safe.
The briefs came from big names. First, the U.S. Chamber of Commerce. It speaks for business. They say the law is good. It keeps Delaware strong. Most companies pick it to start. Over 60% of Fortune 500. The Chamber argues the state lawmakers did right. They fixed court worries. Without the law, companies might leave. That hurts jobs and taxes.
Second, the Society for Corporate Governance filed. They help boards do well. Their brief says safe harbors make sense. They give clear rules. Boards need this for tough calls. Like deals with owners. The group has 3,000 members. Many from top firms. They say the law fits Delaware’s history. It trusts boards to act right.
Third, a team of law professors wrote one. They teach at schools like NYU and Columbia. They say the law is okay under the constitution. The General Assembly has power. It sets company rules. The professors point to old cases. They say courts let lawmakers act. As long as it helps fairness. S.B. 21 does that. It stops too many lawsuits. And keeps good deals going.
All three briefs say the same. The law does not go too far. It builds on past ideas. Like the MFW case from 2020. That set steps for controller deals. But it was hard. Now, S.B. 21 makes it easier. No need for full court watch if steps are done.
The case started in Boeing. Stockholders sued over a deal. They said bosses got too much. The Chancery Court sent questions up. To check the new law. Vice Chancellor Travis Laster asked. He wants clear answers. Oral arguments are set for October. The court will hear from lawyers then.
Delaware watches close. The state brings in $2 billion a year from company fees. If the law falls, it could lose spots. To places like Nevada. Lawmakers passed S.B. 21 fast. After talks with courts and firms. Governor John Carney signed it. He said it keeps Delaware first.
Critics say wait. Some groups fight the law. They want full checks on power. Like in the Corwin case. That says votes clean deals. But controllers need more. The briefs answer that. They say safe harbors help without harm.
Experts think the court will like the briefs. Delaware loves business law. It changes rules to fit needs. A win keeps the safe harbors. It makes deals smoother. Companies plan better.
For now, the briefs add weight. They show wide support. From business to schools. The Supreme Court will read them. And decide soon.
This case shapes the future. For Delaware. And all companies there. Safe harbors could spread. Or face more fights. Business waits.