The Delaware Court of Chancery is what, exactly? In a 230-year-old court, Twitter will take on Elon Musk


Elon Musk tried to back out of a $44 billion deal to purchase the company, saying that Twitter had breached “many provisions of that Agreement” by neglecting to share this information regarding bogus accounts. The case between the two parties is scheduled to go to court in October. And that’s where the 230-year-old Delaware Court of Chancery, which has seen some of the biggest business disputes in history, comes into play. There won’t be a jury or cameras in the courtroom. Rumor has it that the judge won’t be restricted by the law either.

According to the NY Post, Phil Shawe, the CEO, and co-founder of TransPerfect, whose cases have been heard by this court, proceedings in the Delaware Chancery are mostly based on your attorney’s relationship with the particular chancellor who is considering your case. The people you quarrel with in court are the same people you dine with. In an email from 2018 to the Chinese energy firm CEFC that was found on his abandoned laptop, Hunter Biden wrote, “I will bring suit in the Chancery Court in Delaware — which as you know is my home state and I am fortunate to have worked with and know every judge in the chancery court,” according to Shawe. He asserted that Biden’s email sums up the court’s reputation, which may rule against Musk and demand “specific performance.” In order to avoid just paying a fine and moving on, the judge for the Delaware Court of Chancery, Kathaleen McCormick, may opt to compel him to finish his initial agreement to buy the site for $54.20 per share. According to Reuters, she is “one of the few jurists who has ever compelled a hesitant buyer to finalise a US corporate merger” and “has a no-nonsense reputation.”

The Delaware Court of Chancery is what, exactly?

According to the court’s official website, the Supreme and Superior Courts are the other two courts mentioned in the State Constitution along with the Delaware Court of Chancery, which was founded in 1792. It is referred to as a court of equity rather than a court of law because it allows for more flexible decisions than the law explicitly allows.

Twitter, which filed the 62-page case against Musk at this court, did so because the social media platform was established here in 2007 and because the court has a wealth of commercial litigation expertise. The court, which has a chancellor and six vice-chancellors, usually handles issues involving adoptions, divorces, and wills, among other things.

The Delaware Division of Corporations asserts that “there are more than 1.8 million corporations registered in Delaware, with the First State adding more than 336,000 corporate organizations to its ranks in 2021 alone.”

Relationship between Musk and the Court of Chancery

This is not the first time that Musk will be litigating a business matter in this court. He was found guilty of forcing Tesla Inc. to pay $3 billion to acquire SolarCity, according to a shareholder case he won earlier this year. The majority shareholder and board chairman of SolarCity was Musk.

Earlier sources said that Musk wanted the testing to start in February 2023. Twitter was successful in getting a shorter time limit. Now, the five-day trial will begin in October of this year. The exact dates have not yet been disclosed to the public.

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