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    Top Law Firms Defend Overhaul of America’s Business Court

    After backlash from Elon Musk and companies like Meta, Big Law is publicly supporting a bill seeking to reform the Delaware Court of Chancery.As Delaware lawmakers prepare to hold hearings tomorrow about a bill that could reshape corporate America, some of the biggest corporate law firms are coming out in favor of it.On Tuesday, 21 law firms — including Simpson Thacher and Bartlett; Cravath, Swaine & Moore; and Paul, Weiss, Rifkind, Wharton & Garrison — will publish a letter strongly supporting legislation that would override a series of decisions by the Delaware Court of Chancery. These rulings have prompted backlash from companies and led many, including Meta, to contemplate moving their incorporation outside the state.The bill is “an important step in maintaining Delaware’s status as the jurisdiction of choice for sophisticated clients when they create companies,” the law firms write.Delaware has been ensnared in controversy after several rulings, including Chancellor Kathaleen McCormick’s decision last year to nullify a big payout for Elon Musk at Tesla. While Mr. Musk’s ire over that decision brought attention to the chancery court, many corporate lawyers say they’re more broadly frustrated with the court’s treatment of companies with controlling shareholders, arguing that it has been overly deferential to noncontrolling shareholders.Given how corporate America fuels Delaware’s budget, a group of Delaware state senators proposed a bill last month to amend the state constitution that would effectively override years of case law by the Delaware Court of Chancery. The group sidestepped the usual process for proposing bills, allowing it to move swiftly — but critics say that it also left out early input from key members of the influential Delaware bar.The issue was a major topic at Tulane University’s Corporate Law Institute conference, a big gathering of deal makers held last week in New Orleans. “We are disempowering Delaware courts,” said Ned Weinberger, a partner at the plaintiffs’ law firm Labaton Keller Sucharow, arguing that the amendment would erode the voice of minority shareholders.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    Delaware Law Has Entered the Culture War

    Elon Musk has helped bring an esoteric debate around the Delaware Chancery Court to a national stage. Now Dropbox and Meta are contemplating moving their incorporation away from the state.The clubby insular world of corporate law has entered the culture war.First, Elon Musk started railing against Delaware, which for more than a century has been known as the home of corporate law, after the Delaware Chancery Court chancellor, Kathaleen McCormick, rejected his lofty pay package last year.Eventually he switched where Tesla is incorporated to Texas.Now, Dropbox has announced shareholder approval to move where it is incorporated to outside Delaware, and Meta is considering following suit. Others are also evaluating whether to make the move, DealBook hears.Musk’s ire against the state where nearly 70 percent of Fortune 500 companies are incorporated brought what would usually be an esoteric issue to the national stage and framed it, alongside hot button issues like diversity, equity and inclusion programs, as one further example of overreach.“You can blame McCormick or you can blame Musk — or you can say it’s a combination of the two of them — but it has turned it into a highly ideologically charged political issue, which it never, ever was before,” said Robert Anderson, a professor at the University of Arkansas School of Law.The drama over court rulings could have huge consequences for the economy and politics of Delaware, which counts on corporate franchise revenue for about 30 percent of its budget — and more, if you count secondary impacts like tax payments generated by the legal industry.At issue is a longstanding question in corporate America: How much say should minority shareholders have, especially in a controlled company? One side argues that founders like Mark Zuckerberg are given controlling shares, which give them outsize influence in a company, with the belief that they know what is best for a company. And minority shareholders buy into a company knowing their limitations. The other side argues these controlling shareholders are not perfect.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    Sarah McBride says Republican attack on trans rights is ‘attempt to misdirect’ voters

    Sarah McBride, the first openly transgender person elected to Congress, on Sunday condemned Republicans’ latest attack on trans rights as “an attempt to misdirect” voters away from more central issues in communities, such as healthcare costs and economic inequality.Delaware’s incoming Democratic member of the House of Representatives, who will join Donald Trump’s new administration in January, also hit back against bathroom restrictions for trans people announced by the GOP on Capitol Hill last week.In a CBS interview on Sunday morning, the congresswoman-elect said: “I think we are all united that attempts to attack a vulnerable community are not only mean-spirited but really an attempt to misdirect. Because every single time we hear the incoming administration or Republicans in Congress talk about any vulnerable group in this country, we have to be clear that it is an attempt to distract.”McBride added: “Every single time we hear them say the word ‘trans’, look at what they’re doing with their right hand. Look at what they’re doing to pick the pocket of American workers, to fleece seniors by privatizing social security and Medicare. Look at what they’re doing, undermining workers.”McBride’s remarks come in response to Republican House speaker Mike Johnson last week banning trans people from using single-sex bathrooms on Capitol Hill that match their gender identity. This follows a bill introduced by South Carolina Republican representative Nancy Mace, who sought similar bathroom restrictions for all trans people using the Capitol, including congressional members, officers and employees.Last Tuesday, Johnson told reporters: “A man is a man, and a woman is a woman, and a man cannot become a woman. That said, I also believe that’s what [Bible] scripture teaches … but I also believe that we should treat everybody with dignity.”McBride was asked by CBS whether she believes she is being treated with dignity.McBride said: “I didn’t run for the United States House of Representatives to talk about what bathroom I use. I didn’t run to talk about myself. I ran to deliver for Delawareans. While Republicans in Congress seem focused on bathrooms and trans people, and specifically me, I’m focused on rolling up my sleeves, beginning the hard work of delivering for Delawareans on the issues that I know keep them up at night.”She added: “Every bit of time and energy that has been used to divert the attention of the federal government to go after trans people is time and energy that is not focused upon addressing the cost of living for our constituents, and we have to be clear that there is a real cost to the American worker every time they focus on this.”skip past newsletter promotionafter newsletter promotionSupporters of McBride and trans equality, including fellow Democrats in congress, have rushed to defend her.Illinois US senator and Democrat Tammy Duckworth told CNN on Sunday that she believes Mace’s position is “disgusting and wrong”, adding: “I think we have a lot more to worry about than where somebody goes to pee.” More

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    Trans congresswoman Sarah McBride responds to Capitol Hill bathroom ban

    Sarah McBride, the incoming congresswoman and first openly transgender person elected to the US House of Representatives, on Wednesday shared a statement on social media in response to the House banning trans people from using single-sex bathrooms on Capitol Hill that match their gender identity.Earlier in the day, the House speaker, Louisiana Republican Mike Johnson, issued a statement “regarding facilities throughout the US Capitol complex”.Johnson said: “All single-sex facilities in the Capitol and House Office Buildings – such as restrooms, changing rooms, and locker rooms – are reserved for individuals of that biological sex.”He added: “It is important to note that each member office has its own private restroom, and unisex restrooms are available throughout the Capitol. Women deserve women’s only spaces.”McBride is due to be sworn in in January to represent Delaware after handily winning the seat in the election earlier this month, having been the first openly trans person elected to the state senate seat there in 2020.She had initially pushed back over proposed restrictions by saying the argument was a far-right-driven distraction from issues such as housing, healthcare and childcare.But on Wednesday, after Johnson’s announcement, McBride responded with a post on X: “I’m not here to fight about bathrooms, I’m here to fight for Delawareans and to bring down costs facing families. Like all members, I will follow the rules as outlined by Speaker Johnson, even if I disagree with them … serving in the 119th Congress will be the honor of a lifetime, and I continue to look forward to getting to know my future colleagues on both sides of the aisle.”On Monday Nancy Mace, the South Carolina Republican representative, had introduced a bill to ban transgender people, including congressional members, officers and employees, from using single-sex bathrooms and other facilities on Capitol Hill that correspond to their gender identity.Mace told reporters that McBride “does not belong in women’s spaces, women’s bathrooms, locker rooms, changing rooms, period, full stop” and called her a biological man, insisting that McBride “doesn’t get a say”, CNN reported.Mace’s bill comes as Republicans have attacked transgender people as part of a broader political culture-war strategy, limiting what bathrooms they can use and the youth sports teams they can play on. Fourteen states currently have laws that prohibit transgender people from using the bathroom that corresponds with their gender identity, according to the Human Rights Campaign, an LGBTQ+ rights group.Donald Trump leaned into such politics vigorously during the presidential election campaign.

    This article was amended on 20 November 2024 to remove a reference to a Bluesky post that had been attributed to Sarah McBride. A representative for McBride later said the account is not affiliated with the congresswoman-elect. More

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    Newsmax and Smartmatic settle 2020 US election defamation lawsuit

    The voting machine company Smartmatic and the conservative outlet Newsmax have settled a closely watched defamation lawsuit days before it was set to go to trial in Delaware.A spokesman for the Delaware courts said the case had been settled on Thursday. He did not offer additional details. The trial was set to begin in Wilmington on Monday.The terms of the settlement are not public.“Newsmax is pleased to announce it has resolved the litigation brought by Smartmatic through a confidential settlement,” Bill Daddi, a spokesman for the network, said in a statement.After the 2020 election, Newsmax aired several false claims about the company, whose voting machines were only used in Los Angeles county in 2020. The network repeatedly aired false claims from Trump allies that the software was widely used across the country and that it had been hacked to change votes.Smartmatic sued Newsmax, Fox, One America News Network (OANN) and others for broadcasting their false claims. It settled the case with OANN earlier this year and the Fox case is still pending in New York.Smartmatic said in a statement: “We are very pleased to have secured the completion of the case against Newsmax. We are now looking forward to our court day against Fox Corp and Fox News for their disinformation campaign. Lying to the American people has consequences. Smartmatic will not stop until the perpetrators are held accountable.”First amendment scholars were closely watching the case and several others like it to see whether libel law can be used as an effective tool to police misinformation.The case was set to be a kind of sequel to the defamation litigation between Dominion, another voting machine company, and Fox over 2020 election lies. That case was settled just before the trial was set to begin, with Fox agreeing to pay Dominion $787.5m. Eric Davis, the judge who oversaw the Fox case, was also overseeing the Newsmax case.A settlement was not surprising in the case as trial neared. Davis ruled that Smartmatic could not seek punitive damages, a decision that significantly limited any possible financial payout for Smartmatic.Davis had also ruled that Newsmax could use the “neutral report privilege” as a defense in the case – a legal shield that allows media outlets to broadcast allegations if they are reporting on a newsworthy event and do so in a disinterested and neutral way. Davis had not let Fox used that defense in its litigation.Smartmatic executives were indicted by the justice department earlier this year on bribery charges in the Philippines. Even though the charges were completely unrelated to the 2020 election, it offered an opportunity for Newsmax lawyers to argue that the company’s poor reputation could not be attributed to what was said on its air.But Newsmax also had reasons to settle. In a pre-trial conference, a lawyer for the company had called it a “bet-your-company” case for the outlet. Newsmax, which is projecting $180.5m in revenue this year, saw a surge in audience under the Trump administration and a bump that caught Fox’s attention after the 2020 election as it broadcast false claims about voting.“The Newsmax surge is a bit troubling – truly is an alternative universe when you watch, but it can’t be ignored,” Jay Wallace, a Fox executive, wrote in an email to a colleague after the 2020 election.Unlike in the Fox and Dominion litigation, only a few details emerged in the case revealing internal discussions at Newsmax as they broadcast false claims about the election. One of the messages was an internal letter from Christopher Ruddy, the network’s CEO from November 2020, conceding the network did not have evidence of voter fraud.“Newsmax does not have evidence of widespread voter fraud. We have no evidence of a voter fraud conspiracy nor do we make such claims on Newsmax,” he wrote on 12 November 2020. “We have reported on significant evidence of widespread election irregularities and vote fraud. We will continue to report on that. We believe we should not censor allegations made by the President or his lawyers or surrogates. Our job is not to filter the news but report information and allow Americans to decide.”Another exchange included Bob Sellers, a Newsmax host, and a producer, wondering how long they would have to air false claims about the election. “How long are we going to have to play along with election fraud?” Sellers wrote on 9 November 2020. “Trump’s MO is always to play victim [] And answer this question. Is there anything at all that could result in another election? The answer is no. and are there enough votes that could be switched or thrown out from fraud or irregularities? No.”The lack of a trial may rob the public of the chance to hear about the state of mind of people who were behind broadcasting election lies, said RonNell Andersen Jones, a first amendment scholar at the University of Utah who has closely followed the defamation cases filed by those harmed by 2020 election lies.Still, she noted that Davis had already ruled that the statements at issue in the case were false, and cautioned against expecting defamation cases to be a cure for misinformation.“Defamation law can declare something a lie, but the question of whether a lie was told is only one of many questions that have to be asked and answered,” she said in an interview earlier this week. “It is a notoriously complex area of law, which means cases can be won or lost on a lot of grounds that have nothing to do with the truth or falsity of the statement. And I am not sure that translates well to public discussion.”Lyrissa Lidsky, a media law professor at the University of Florida, also cautioned against expecting libel law to be a cure-all for disinformation.“Defamation law is not a panacea for election misinformation. There’s just no two ways about it,” she said. “It’s just a small piece.” More

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    Beaches Close in Maryland, Delaware and Virginia as Needles Wash Ashore

    Beachgoers were urged to stay out of the water after dozens of hypodermic needles, as well as tampon applicators and other medical waste, were found on beaches over the weekend.The authorities closed beaches in Maryland, Virginia and Delaware to swimmers on Sunday after medical waste — including used hypodermic needles and used feminine hygiene products — washed up in popular vacation spots.The closures stretched along nearly 50 miles of coast from Fenwick Island in Delaware to Chincoteague Island in Virginia. The beaches include Assateague Island, a barrier island that stretches 37 miles along the coasts of Maryland and Virginia, as well as Ocean City, Md., and Dewey Beach in Delaware.“We currently have no idea where it came from and will not be speculating about a source,” the National Park Service office at Assateague Island National Seashore said of the medical waste in a statement on Facebook.Along with used needles, the authorities said they also discovered used tampon applicators, colored needle caps, and cigarillo cigar tips. An Assateague park manager told The Washington Post that crews had discovered the garbage early Sunday while patrolling after high tide. They had found nearly 50 needles there, and enough waste material to fill a five-gallon bucket. The official added that no injuries or incidents had been reported, and swimmers had not encountered the objects.The waste began coming ashore on Sunday morning, officials at Assateague said, and they were unsure how long beaches in the area would remain closed.The alerts impacted dozens of miles of coastline, including busy tourist beaches, as authorities not only urged caution among swimmers, but in many areas forbade activities in the water, including swimming, wading and surfing.“Until we are confident that the situation is under control, we recommend wearing shoes on the beach and avoiding the ocean entirely,” Joe Theobald, the director of Emergency Services in Ocean City, Md., said in a statement.It’s not the first time that tides have scattered such hazardous material along the eastern seaboard. In 2021, floodwaters in New York City caused sewage releases in New York harbor that sent hundreds of used syringes along the Jersey Shore. At the time, authorities believed many were likely used by diabetics, who had flushed the needles down the toilet after use.And, in 1987, dozens of miles of New Jersey shoreline were shut down after hospital waste and raw garbage suddenly appeared on beaches. In that instance, incensed officials believed the waste was illegally dumped by a passing barge.It was unclear on Monday how long the beaches would remain closed. Shorelines still remained off-limits to swimmers on Sunday evening. More

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    Biden Is Out, and Democrats Have a Whole New Set of Questions

    An earthshaking political moment finally arrived, and the transformation of the campaign starts now.It’s over.At 1:46 p.m., with the minute hand of the clock pointed to the number of his presidency, President Biden somberly ended his untenable re-election campaign and sought to give his downtrodden party something he could no longer provide: a sense of hope.“It is in the best interest of my party and the country for me to stand down,” he wrote in a letter posted to X, “and to focus solely on fulfilling my duties as president for the remainder of my term.”It was an earthshaking political moment many Democrats had been clamoring for — so I’m struck by how quietly it came, and with how little fanfare. Biden’s choice, made while he is at his Delaware beach house after testing positive for Covid-19, did not leak. He told some of his senior staff only a minute before he told the world, my colleague Katie Rogers reported. He did not make a speech to the public, though he said he will later this week.His campaign’s transformation, though, starts now.About half an hour after he withdrew, Biden endorsed his vice president, Kamala Harris. A little after 4 p.m., she made it official herself.“My intention,” Harris said in a statement distributed by the Biden for President campaign, “is to earn and win this nomination.”In an all-staff call, the campaign’s leaders said they were now all working for Harris for President, according to my colleague Reid Epstein.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More