The Delaware Supreme Court reversed a Court of Chancery ruling in *Moelis & Company v. West Palm Beach Firefighters' Pension Fund*, delivering a victory for the investment bank in a shareholder rights dispute decided January 20, 2026.
The case involved the West Palm Beach Firefighters' Pension Fund, which brought a class action lawsuit on behalf of itself and other similarly-situated Class A stockholders of Moelis & Company. The pension fund sought a declaratory judgment that certain provisions of a stockholders agreement were facially invalid and unenforceable.
The Delaware Supreme Court heard the case en banc, with Chief Justice Seitz and Justices Valihura, Traynor, Legrow and Griffiths participating. Justice Traynor authored the opinion reversing the lower court's decision. The case was submitted to the high court on October 27, 2025.
The underlying dispute centered on the validity of specific provisions within Moelis & Company's stockholders agreement. While the complete details of the challenged provisions are not disclosed in the available court records, the case appears to involve fundamental questions about the enforceability of contractual arrangements between the investment bank and its shareholders.
Moelis & Company was represented by a team from Morris, Nichols, Arsht & Tunnell LLP in Wilmington, Delaware, along with attorneys from the prestigious New York firm Wachtell, Lipton, Rosen & Katz. William Savitt of Wachtell Lipton argued the case before the Supreme Court, supported by colleagues Anitha Reddy, Won S. Shin and Daniel B. Listwa. John P. DiTomo of Morris Nichols also represented the investment bank.
The pension fund was represented by Thomas Curry of Saxena White P.A. in Wilmington, who argued the case on behalf of the plaintiff.
The case attracted significant attention from the legal academic community, with multiple amicus curiae briefs filed by prominent corporate law scholars. One group of amici included James An, Lucian A. Bebchuk, Anat Alon Beck, Ilya Beylin, Robert E. Bishop, Joan Heminway, Mark Lebovitch, Michael Klausner, Frank Partnoy, Brian JM Quinn, Usha R. Rodrigues, Robert B. Thompson, Anne Tucker, and Charles Whitehead. They were represented by attorneys from Labaton Keller Sucharow LLP and Olshan Frome & Wolosky.
A second group of academic amici included Joseph A. Grundfest, Lawrence A. Hamermesh, Jonathan R. Macey, and Charles R.T. O'Kelley, represented by Richards, Layton & Finger P.A. in Wilmington.
The case originated in the Court of Chancery as C.A. No. 2023-0309, indicating the lawsuit was filed in 2023. The pension fund initially prevailed in the trial court, prompting Moelis & Company to appeal to the Delaware Supreme Court.
Delaware corporate law governs the vast majority of publicly traded U.S. companies, making decisions from the Delaware Supreme Court particularly influential in shaping corporate governance standards nationwide. The reversal suggests the high court found the Court of Chancery erred in its analysis of the stockholders agreement provisions.
Moelis & Company is a global investment banking advisory firm founded by Ken Moelis in 2007. The firm provides strategic advice on mergers and acquisitions, restructuring, and capital markets transactions. Like many investment banks, Moelis has a complex capital structure that includes different classes of stock with varying rights and privileges.
Pension funds like the West Palm Beach Firefighters' Pension Fund frequently serve as lead plaintiffs in shareholder litigation, as their fiduciary duties to beneficiaries and substantial holdings make them attractive representatives for class action lawsuits. These institutional investors often challenge corporate governance practices they believe harm shareholder interests.
The Delaware Supreme Court's reversal in this case may have broader implications for how courts evaluate the enforceability of stockholders agreement provisions. While the specific reasoning behind the reversal is not detailed in the available court records, the decision will likely influence future litigation involving similar contractual arrangements between corporations and their shareholders.
For Moelis & Company, the Supreme Court victory eliminates what could have been a costly adverse ruling that might have required restructuring aspects of its stockholder arrangements. The reversal also validates the company's position that the challenged agreement provisions were legally sound and enforceable.
The case demonstrates the continuing importance of Delaware courts in resolving complex corporate governance disputes. As the preferred jurisdiction for incorporation among major U.S. corporations, Delaware's legal precedents often establish standards that influence corporate behavior across the country.
The full implications of the Supreme Court's decision will become clearer when the complete opinion is published, providing the court's detailed reasoning for reversing the Court of Chancery's ruling in favor of the pension fund.