The growing movement of public companies to reincorporate outside Delaware has transformed a policy debate into an increasingly significant source of corporate governance litigation. As companies have explored domiciles such as Nevada and Texas, Delaware has responded with legislative reforms, including Senate Bill 21 (“SB 21”), and judicial decisions that seek to clarify the standards governing these transactions.[1]

Against this backdrop, the recently amended complaint challenging Dropbox, Inc.’s reincorporation to Nevada raises important questions regarding the circumstances under which a reincorporation may be challenged as a breach of fiduciary duty.

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