Same Parties Litigate Same Inspection Demand In California And Delaware - Why The Courts Came To Seemingly Different Conclusions

Two months ago, I wrote about a ruling by Vice Chancellor Will in Orchid Global, Inc. v. Salamon.1 In an inversion of the typical inspection case, that case involved a suit by a Delaware corporation against a stockholder, David Salamon, seeking to establish that Delaware law governs the stockholder's demand to inspect corporate records. The defendant, a resident of California, moved to dismiss for lack of personal jurisdiction. Vice Chancellor Will ruled that although the dispute concerns inspection rights, which in his view were an internal affairs matter, the corporation’s forum selection bylaw did not apply to a suit filed by a corporation against a stockholder.2