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As Section 11, 15 U.S.C.S. § 77k(a), claims are not internal corporate claims, Del. Code Ann. tit. 8, § 115 (Section 115) does not apply. In sum, federal-forum provisions (FFPs), which direct Section 11 claims to federal courts (which are most experienced in adjudicating them), do not violate Section 115 and are facially valid. Stated differently, we do not think the Delaware General Assembly intends to encompass federal claims within the definition of internal corporate claims. Thus, Section 115 is not implicated.
Blue Apron Holdings, Inc., Roku, Inc., and Stitch Fix, Inc. are all Delaware corporations that launched initial public offerings in 2017. Before filing their registration statements with the United States Securities and Exchange Commission (the "SEC"), each company adopted a federal-forum provision (FFPs) requiring actions arising under the federal Securities Act of 1933 (the "Securities Act" or "1933 Act") to be filed in a federal court. Appellee Matthew Sciabacucchi ("Appellee") bought shares of each company in its initial public offering or a short time later. He then sought a declaratory judgment in the Court of Chancery that the FFPs are invalid under Delaware law. The Court of Chancery held that the FFPs are invalid because the "constitutive documents of a Delaware corporation cannot bind a plaintiff to a particular forum when the claim does not involve rights or relationships that were established by or under Delaware's corporate law."
Were the FFPs requiring actions arising under Securities Act to be filed in a federal court valid?
The court held that FPPs do not violate federal law or policy, and the Court referred to United States Supreme Court case law, which has held that federal law has no objection to provisions that preclude state litigation of Securities Act claims. The Court further held that FFPs, as charter provisions, must be subjected to, and approved by a vote of the stockholders. The court noted that as Section 11, 15 U.S.C.S. § 77k(a), claims were not internal corporate claims, Del. Code Ann. tit. 8, § 115 (Section 115) did not apply as FFPs, which direct Section 11 claims to federal courts (which are most experienced in adjudicating them), do not violate Section 115 and are facially valid.