Delaware high court hears translation firm’s messy board battle

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By Tom Hals | WILMINGTON, Del.

WILMINGTON, Del. The Delaware Supreme Court will
hear an appeal on Wednesday in a boardroom battle between former
college sweethearts that includes claims of midnight office
break-ins and assault, and prompted a lobbying campaign to
rewrite the state’s corporate law.

The appeal could determine who controls TransPerfect Global
Inc, a billion-dollar translation company started by Elizabeth
Elting and Philip Shawe, warring co-owners who founded the
company in the 1990s in a college dorm.

Shawe wants Delaware’s top court to overturn a 2015 ruling
by Andre Bouchard, chief of the Court of Chancery, who found the
relations between the two were so poisoned that they deadlocked
on decisions on hiring, expansion and investment.

Bouchard sided with Elting and ordered the co-owners to sell
their stakes and protect the company’s future.

The case prompted a campaign by some of TransPerfect’s 3,500
employees seeking to curtail the power of the Court of Chancery,
which handles disputes involving the state’s corporate law for
companies all over the United States. They want to
limit the court’s power to order the sale of a company and are
planning a rally outside the Delaware Supreme Court on
Wednesday.

Shawe maintains that TransPerfect is growing rapidly and
remains profitable and Bouchard should have adopted less
draconian steps rather than ordering him to sell his 49 percent
stake. Shawe argued that Elting used her lawsuit to get a better
deal than he offered for her half of the company.

Shawe also wants the Supreme Court to review $7 million of
sanctions that Bouchard imposed on him for violations such as
destroying evidence.

Bouchard penalized Shawe for breaking into Elting’s office
on New Year’s Eve to swipe from her computer emails to her
lawyers, and for the loss of text messages on an iPhone. Shawe’s
assistant discarded the phone, saying he feared it was
contaminated by rat droppings.

Shawe has said all evidence was preserved. He has argued he
entered Elting’s office in the middle of the night because she
was being investigated for stealing from TransPerfect.

A six-day trial revealed years of explosive arguments and
harassing behavior, such as Shawe showing up uninvited to
Elting’s wedding and booking a seat next to her without notice
on a transatlantic flight.

Elting kicked Shawe during a fight in her office and he
reported her to the police, although assault charges were
dropped before she was arrested.

The legal battle may not end with state’s Supreme Court.

Shirley Shawe, Philip’s mother and owner of 1 percent of
TransPerfect, hired famed lawyer Alan Dershowitz, and has raised
questions of constitutional law, which could open an appeal to
the U.S. Supreme Court.



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