The Harvard Law School Forum on Corporate Governance https://corpgov.law.harvard.edu The leading online blog in the fields of corporate governance and financial regulation. Thu, 24 Sep 2026 11:32:11 +0000 en-US hourly 1 https://wordpress.org/?v=6.5.11 https://corpgov.law.harvard.edu/wp-content/uploads/2024/02/cropped-photography-4-e1706898544564-1-32x32.png Dodiya v. Franklin and the Emerging Rules of the DGCL’s Section 144 Safe Harbors – The Harvard Law School Forum on Corporate Governance https://corpgov.law.harvard.edu 32 32 Dodiya v. Franklin and the Emerging Rules of the DGCL’s Section 144 Safe Harbors https://corpgov.law.harvard.edu/2026/09/24/dodiya-v-franklin-and-the-emerging-rules-of-the-dgcls-section-144-safe-harbors/?utm_source=rss&utm_medium=rss&utm_campaign=dodiya-v-franklin-and-the-emerging-rules-of-the-dgcls-section-144-safe-harbors https://corpgov.law.harvard.edu/2026/09/24/dodiya-v-franklin-and-the-emerging-rules-of-the-dgcls-section-144-safe-harbors/#respond Thu, 24 Sep 2026 11:30:23 +0000 https://corpgov.law.harvard.edu/?p=183952?d=20260923144607EDT Posted by John Butler, Adam Cromie, David Grubman, Sidley Austin LLP, on Thursday, September 24, 2026
Editor's Note:

John Butler, Adam Cromie, David Grubman are Partners at Sidley Austin LLP. This post is based a Sidley memorandum by Mr. Butler, Mr. Cromie, Mr. Grubman, Courtney Hauck, Arthur Adler, all at Sidley, and is part of the Delaware Law Series; links to other posts in the series are available here.

On August 26, 2026, the Court of Chancery issued Dodiya v. Franklin, C.A. No. 2025-0932-LWW (Del. Ch. Aug. 26, 2026), concluding that the “striking breakdown in corporate governance” detailed in the complaint made the “predictable path to safe harbor” under amended Section 144 of the Delaware General Corporation Law (DGCL) unavailable at the pleading stage. Dodiya’s message for boards is simple: the safe harbors deliver powerful protection, particularly by virtue of the presumption of disinterestedness afforded to directors determined to be independent for listing standard purposes, but only to boards that (i) run a process that is not grossly negligent and (ii) provide materially accurate disclosure to stockholders.

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