Kathaleen McCormick

Kathaleen Saint Jude McCormick (born 1979) is an American lawyer and judge on the Delaware Court of Chancery, first as a vice chancellor from 2018 to 2021 and then as the current chancellor since 2021. She is the first female chancellor in Delaware history.

Career

McCormick was born in Dover, Delaware, and grew up in Smyrna, Delaware. She earned a Bachelor of Arts in philosophy from Harvard University, and her Juris Doctor from Notre Dame Law School. She began her career as a legal aid lawyer. She then went into private practice at Wilmington law firm Young Conaway Stargatt & Taylor, where she became a partner. At Young Conaway, she specialized in corporate and alternative entity law.

In September 2018, Governor John Carney nominated McCormick and Morgan Zurn to two new vice-chancellor positions on the Delaware Court of Chancery. These appointments raised the total number of judges on the court from five to seven, the first such expansion since 1989. Carney noted that McCormick's experience would make her "an immediate asset to the court." She was confirmed by the Delaware Senate on October 3 and took office on November 1.

In April 2021, she was nominated by Delaware Governor John Carney as Chancellor of the Delaware Court of Chancery, following the mid-term resignation of the former Chancellor Andre Bouchard. The Delaware Senate confirmed McCormick, and she began her 12-year term on May 6. McCormick is the first woman to lead the court since it was established in 1792.

Notable cases

On April 30, 2021, McCormick issued a post-trial decision in ''Snow Phipps Group, LLC v. KCake Acquisition, Inc''. The case was among the first "busted deal" cases that emerged as mergers and acquisitions buyers sought to avoid closing mergers after the COVID-19 pandemic negatively impacted the businesses of many merger targets. The plaintiffs were Snow Phipps Group, LLC a private equity firm, and DecoPac Holdings, Inc., the parent company of KCake, a cake decorations company. After the COVID-19 pandemic negatively impacted KCake's business, the defendant, Kohlberg & Co., sought to avoid its contractual obligation to complete a $550 million acquisition of KCake. McCormick rejected Kohlberg's arguments that the COVID-19 pandemic resulted in a material adverse change or a breach of the ordinary course of business covenant in the merger agreement by the plaintiffs, then held that Kohlberg had breached its contractual obligation to use its "reasonable best efforts" to obtain financing for the transaction. McCormick then ordered Kohlberg to close the transaction.

On July 13, 2022, McCormick was assigned to adjudicate the merger dispute between Twitter, Inc. and Elon Musk, '' Twitter v. Musk''. Over Musk's objections, McCormick granted Twitter's motion for expedited treatment of the lawsuit and set a trial date for October 2022. Twitter asked the court to enter an order of specific performance, effectively forcing Musk to close the deal. Observers noted that in the KCAKE case in 2021, McCormick had granted the same relief that Twitter sought, forcing the buyer in that case to close the transaction. With many legal commentators opining that Musk would lose the lawsuit, Musk agreed to close the transaction. The deal closed on October 28, 2022. Commentators praised McCormick's "no-nonsense approach" as having been instrumental in resolving the dispute.

In January 2024, McCormick voided Elon Musk's $55 billion Tesla pay package in the case of '' Tornetta v. Musk, et al.'' The lawsuit, filed in 2018 by Tesla shareholder Richard Tornetta, who owned nine shares, alleged that Tesla's board breached its fiduciary duties by approving Musk’s compensation package. The package had been approved by Tesla shareholders in 2018 with approximately 73% of the vote, but McCormick found that the proxy statement provided to shareholders in connection with the compensation package was materially misleading, voiding the vote and opening the grant to judicial review regarding entire fairness. She then ruled that the size of the pay package was extraordinary and unfair.Judge voids Elon Musk's 'unfathomable' $56 billion Tesla pay package
Reuters, January 31, 2024 In June 2024, following the court decision, Tesla shareholders reapproved the package with about 77% support. However, McCormick reaffirmed her decision in December 2024, citing a lack of legal precedent for reversing a decision based on a post-trial ratification. In connection with the case, the plaintiff's attorneys initially sought a fee award of $5.6 billion, representing 29 million shares of Tesla stock, but McCormick awarded them $345 million in cash or Tesla shares.

References

{{DEFAULTSORT:McCormick, Kathaleen
Delaware lawyers
Chancellors of Delaware
Vice chancellors of Delaware
Notre Dame Law School alumni
Harvard College alumni
Living people
1979 births