Delaware Supreme Court Finds Litigation Fee-Shifting Bylaws Facially Valid
On May 8, 2014, the Delaware Supreme Court held that provisions in a non-stock corporation’s bylaws requiring that litigation costs and fees be shifted to the losing party can be valid in Delaware. In ATP Tour, Inc. v. Deutscher Tennis Bund, the Court, sitting en banc, explained that assuming fee-shifting bylaws are not prohibited by the company’s corporate charter, such bylaws are facially valid because they do not violate the Delaware General Corporation Law or any other Delaware statute, nor are they repugnant to any principle of common law.