Meta considers leaving Delaware, Dropbox announces DE departure
Yesterday at 02:58 AM
Meta, the parent company of social media giants like Facebook and Instagram, is exploring options to change its legal domicile from Delaware to Texas or another state, according to sources familiar with the matter. This move would not affect the location of its corporate headquarters, which remains in California.
Key Points:
- Meta has held discussions with Texas officials about potentially relocating its incorporation. The company is also looking at other states for this legal shift, as noted in a Wall Street Journal report.
- With Mark Zuckerberg as a controlling shareholder, Texas is seen as favorable for companies with similar structures.
- Following Elon Musk’s lead, who moved Tesla and SpaceX to Texas and Neuralink to Nevada after a Delaware court decision, Meta is considering similar actions.
- Delaware is home to most Fortune 500 companies due to its business-friendly court system. However, recent court rulings have frustrated executives and controlling shareholders.
- Meta faces ongoing lawsuits in Delaware, like one related to the Cambridge Analytica scandal. Legal scholars note that current cases would remain in Delaware, but future cases could be in the new state of incorporation.
Recent Developments:
- Dropbox announced that it was moving its incorporation to Nevada from Delaware, indicating a trend among tech companies.
- Meta has also decided to end traditional fact-checking on its platforms in favor of a “Community Notes” system similar to Elon Musk's social media platform, X.
Broader Context:
- Texas has been attracting businesses by setting up specialized courts for business disputes, a move followed by over two dozen states.
- A Meta spokesperson confirmed there are no plans to move the corporate headquarters from California but declined to comment further on the reincorporation discussions.
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