Jones Apparel Group, Inc. v. Maxwell Shoe Company

Delaware Court of Chancery · 2004 · Corporations

883 A.2d 837 (2004)

Updated August 22, 2026

Corporationscharter provisionsrecord dateswritten consentsDGCL §§ 102(b)(1), 141(a), 213(b), 228certificate of incorporationprivate orderingboard authority

Facts

Maxwell's Article VII provided that the record date for stockholders entitled to consent in writing to any action would be the first date on which a signed written consent was delivered to the corporation. After Jones announced a consent solicitation to remove Maxwell's board, Maxwell's board set March 25, 2004 as the record date even though Maxwell later admitted it had not yet received any written consent. Jones then delivered an executed written consent on April 21, 2004 and argued that Article VII made that date the record date. Maxwell contended either that Article VII should be read to preserve the board's power under DGCL § 213(b) or, if not, that Article VII was invalid.

Issue

Does Maxwell's charter provision unambiguously prevent the board from setting the record date for a written-consent solicitation, and if so, is that restriction valid under the DGCL despite § 213(b)'s grant of authority to boards to fix record dates?

Rule

An unambiguous charter provision controls the method for setting a consent-solicitation record date. Under DGCL §§ 102(b)(1) and 141(a), a certificate of incorporation may create, define, limit, or regulate directors' powers, including restricting board authority otherwise recognized by statute, unless the charter provision transgresses a mandatory statutory rule or a settled Delaware public policy implicit in the DGCL or common law. Section 213(b) supplies a default regime and does not, by itself, make board authority to set consent record dates inalienable.

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One of 10 multiple-choice questions for this case. Pick an answer to see why.

Lakeview Robotics, Inc., a Delaware corporation headquartered in Chicago, has a charter provision stating: "The record date for stockholders entitled to act by written consent on any matter shall be the first date on which a signed written consent is delivered to the corporation." A dissident stockholder group announces a consent solicitation to remove directors, and two days before any signed consent is delivered, the board adopts a resolution fixing an earlier record date.

If litigation follows, which result is most likely?

Explanation. An unambiguous charter provision stating that the record date "shall be" the first date a signed written consent is delivered is mandatory and exclusive. Under the majority opinion, the board cannot imply an exception preserving its own authority when the charter language is plain. Because the DGCL provisions at issue are enabling and § 213(b) supplies a default regime rather than an inalienable board power, the charter rule governs unless it violates mandatory law or settled public policy, which this kind of provision does not.