Delaware has a unique court, the Court of Chancery, which is world-renowned for its jurisdiction in corporate matters. This court is a main reason for Delaware’s preeminence in the field of corporate law. Because of the speed and predictability that comes from experience, as well as a wealth of published judicial decisions, Delaware has emerged as the nation’s “corporate capital.”
Competition from other states is rising, however, as they observe the revenue produced for the state from its status as a top legal venue for corporate law. Over the decades, Delaware has carefully cultivated corporate statutes to make them more attractive to corporations than those of other states. In an effort to continue this, Delaware’s Court of Chancery has developed a system that could allow for binding arbitration. This will allow companies to present arguments privately to a judge from the court and get a decision in a timely manner, instead of the lengthy process of going to trial. The arbitration process is confidential and not available for public record; this is especially important when dealing with proprietary information such as technology and patents.
Eric Ruth of The News Journal writes, “Under the new rules, the rivals can choose to sit down privately with a judge from the court -- or, as they are called, a chancellor -- present their arguments, and let the arbitrator decide the outcome. The goal is to resolve the matter in 90 days -- Chancery Court cases have been known to last a year or two before even reaching trial.”
Delaware’s efforts to broaden the scope of Chancery Court and make the arbitration process confidential, timely, and affordable, will keep the state on the cutting edge as the nation’s “corporate capital.”