Citizens for Judicial Fairness Slams Excessive Delaware Chancery Fees Following New Stanford Report
Citizens for Judicial Fairness Slams Excessive Delaware Chancery Fees Following New Stanford Report
WILMINGTON, Del.--(BUSINESS WIRE)--Citizens for Judicial Fairness today responded to a new Stanford study from renowned professor Joseph Grundfest that shows Delaware’s Chancery Court has become a national outlier in awarding excessive legal fees. The report, which analyzed thousands of cases, found that Delaware hands out attorney fee multipliers at a rate up to 57 times higher than federal courts – with some attorneys being paid as much as $35,000 an hour.
The findings were highlighted in The New York Times’ DealBook newsletter, and arrive as more companies continue to question Delaware’s value as the “gold standard” for corporate law.
Citizens for Judicial Fairness released the following statement in response to the study:
“This study confirms what we’ve been saying for years: Delaware’s Chancery Court is more interested in enriching lawyers than serving shareholders or protecting everyday investors. Two judges, Chancellor Kathaleen McCormick and Vice Chancellor Travis Laster, are responsible for a majority of these outrageous fee awards, and must be reined in so that litigants in Delaware’s courts can have reasonable fee expectations. The pattern is clear: corporate insiders and well-connected firms are cashing in while Delaware’s reputation burns. Delaware lawmakers can’t look the other way anymore. These payouts aren’t normal, and they aren’t defensible. They’re part of a system that’s increasingly out of step with every other court in America. It’s time for serious reform – and if Delaware won’t fix it, the market will.”
The Stanford paper shows that two judges alone account for over 60% of the supersized awards, which often exceed ten times the base legal fee. In some cases, lawyers were paid nearly $50,000 an hour after inflation adjustment. No federal judge has ever come close to authorizing these kinds of fees.
Citizens for Judicial Fairness has long advocated for transparency, common-sense reform, and balance in the state’s corporate legal system, and has warned that if left unchecked, judicial overreach will drive companies, jobs, and corporate revenue out of Delaware.
