On April 1, Trupanion Inc. and its chief executive officer filed what is believed to be the first petition seeking relief in the Delaware Court of Chancery pursuant to Section 205 of the Delaware General Corporation Law. In less than a month, the Chancery Court issued a final order in the action, resolving multiple questions relating to Trupanion’s corporate existence and actions it had taken over several years, in In re Trupanion, C.A. No. 9496-VCP (Del. Ch. April 28, 2014). Prior to the adoption of Section 205, such a timely and comprehensive resolution of the issues Trupanion faced would not have been possible.
Section 205, which was included in the 2013 amendments to the DGCL but did not become effective until April 1, is an innovative statutory provision that allows Delaware corporations and other specified parties, under certain circumstances, to petition the Chancery Court to validate or invalidate, as the case may be, corporate acts. Section 205 provides that the corporation may bring the action directly and that no other parties need be joined in order for the Chancery Court to adjudicate the validity issues. It also provides, however, that the Chancery Court may order notice “to other persons specified by the court,” and those parties may intervene in a Section 205 proceeding.
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