WILMINGTON, Del. A Delaware judge had the
authority to order the sale of TransPerfect Global Inc, a
leading translation business, over the opposition of a co-owner,
the Delaware Supreme Court ruled on Monday in an unusually
heated boardroom battle.
Co-owners Elizabeth Elting and Philip Shawe built
TransPerfect into one of the world’s largest language services
firms, but their once-romantic relationship deteriorated after
they formed the company in their college dorm in the 1990s.
Corporate decision-making eventually ground to a halt and
the warring co-owners turned to the courts to break the
deadlock. In 2015, Chancellor Andre Bouchard of the Court of
Chancery ordered the company sold, and Shawe appealed.
Monday’s 4-1 ruling affirmed Bouchard’s decision. Most of
the 68-page ruling and dissent focused on whether Delaware law
grants a judge the authority to order a sale. The majority said
it does and noted that it was a better outcome than a
“Selling TPG (TransPerfect Global) as a going concern will
protect TPG’s employees from the ruinous consequences of an
asset sale and provide the maximum return to the stockholders,”
said the majority opinion, written by Collins Seitz.
Shawe has argued the outcome amounted to an unconstitutional
taking of property and he said in a statement that he would
appeal to the U.S. Supreme Court.
“No proprietor of a Delaware incorporated business can sleep
easy with the specter than the courts may just decide to take
it, and give to another private citizen,” he said.
Elting’s lawyer, Phil Kaufman of Kramer Levin Naftalis &
Frankel, said in a statement he was gratified by the ruling.
The TransPerfect case has attracted more attention than most
battles over private companies, partly because of the behavior
of the co-owners, which Bouchard described as “bizarre” and “inexplicable.”
Bouchard had 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.
The Delaware Supreme Court upheld $7 million of sanctions
TransPerfect employees launched Citizens for a Pro-Business
Delaware to lobby lawmakers to change the law that permitted the
“This is a sad day for justice in Delaware,” said Chris
Coffey, the campaign’s manager. “Nothing will hurt employees
more than losing their jobs, and that’s what this court order
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