Abstract
Delaware corporate law rests on private enforcement, with stockholder litigation serving as the primary check on managerial misconduct. Delaware judges use attorneys’ fees as a lever in these cases to shape the incentives of plaintiffs’ counsel. Yet little empirical evidence exists on how Delaware judges exercise their discretion in awarding fees. Using a hand-collected dataset of stockholder suits filed in the Court of Chancery, this Article provides a systematic analysis of Delaware’s fee-award practices. Contrary to Delaware’s longstanding judicial assumptions, we find little evidence that fee awards reflect either the risk that these lawyers face when they file contingent cases or the lawyers’ performance in these cases. Our data also show that plaintiffs’ attorneys receive significantly higher fees in Delaware stockholder cases than in comparable federal securities class actions, despite the similar risk profiles of these cases. The data suggest that current practices may over-reward repeat players and large recoveries while undercompensating smaller claims.
These findings raise questions about Delaware’s discretionary approach to setting fees. Vesting Delaware judges with broad discretion has produced a system that lacks consistent benchmarks and may reward factors unrelated to risk or performance. Because these awards are ultimately paid from stockholder or corporate funds, the implications extend beyond the bar to Delaware’s standing as the preeminent forum for corporate law. The Article outlines several pathways for reform, including enhanced transparency in fee decisions, empirical benchmarking across cases, and multiplier caps to constrain outlier awards. More broadly, the analysis demonstrates how data-driven oversight can strengthen the legitimacy and effectiveness of Delaware’s system of corporate adjudication. By situating Delaware’s approach within the broader landscape of representative litigation, this study also contributes to ongoing debates about the proper calibration of incentives in private enforcement regimes.
Document Type
Working Paper
Publication Date
2026
Recommended Citation
Stephen J. Choi, Jessica M. Erickson, & A.C. Pritchard, Is Delaware Different? Stockholder Lawyering in the Court of Chancery (U. Mich. L. & Econ. Working Paper No. 308, 2026).
