In January 2024, Tesla CEO Elon Musk offered blunt advice to business leaders.
“Never incorporate your company in the state of Delaware,” he wrote on X.
Musk’s acrimony stemmed from a decision by Delaware Chancery Court Chancellor Kathaleen McCormick, who voided his $56 billion compensation package, saying that Tesla had failed to prove the contract was “fair.” The fact that there was no legal precedent for her action and that Tesla’s board, shareholders, and Musk had all approved the payout didn’t matter.
An irritated Musk suggested that entrepreneurs incorporate “in Nevada or Texas” if they want shareholder rights to be respected. In the weeks that followed, Musk took his own counsel, relocating SpaceX’s incorporation to Texas and shifting Neuralink’s registration to Nevada.
A single billionaire deciding to move his companies out of a state because of a legal spat might not seem like a big deal, but Delaware isn’t your typical state. Nearly 2.2 million legal entities, including some 68% of Fortune 500 companies, are incorporated in Delaware, a dominance that stems from a historically friendly business climate and a judiciary that has, until recently, proven adept at resolving complex corporate disputes, not causing them.
Quick answer, No
I know many who moved to Delaware in order not to pay tax on goods.
DELAWARE taxes the hell out of them on everything else.
Democrats will just raise another Tax, and tear down more trees and farms to build more homes for more tax revenue.
I’ve noticed the continued destruction of many farms and fields by the firm S.V.N.
I’ve already left and no longer care.