Delaware Corporate & Commercial Litigation Blog

Delaware High Court Finds Investor Pact Suit Delay Fatal, Clarifies “Void/Voidable” Difference

The Delaware Supreme Court in Moelis & Co. v. West Palm Beach Firefighters Pension Fund reversed a Chancery ruling, holding that the 2014 stockholder agreement was voidable rather than void, and therefore the nine‑year‑old lawsuit was barred by the doctrine of laches and the three‑year limitation period. The Court emphasized that because the disputed actions could have been lawfully performed with proper notice, equitable defenses apply. Justice Traynor noted the plaintiff failed to show the provisions were void and highlighted recent legislative attempts to curb the decision’s impact. The ruling provides a clear guidepost for distinguishing void from voidable corporate governance provisions under Delaware law.