Document: OneScreen, Inc. v. Hudgens, C.A. No. 4545-VCP (Del. Ch. March 30, 2010)
Plaintiff corporation sought to rescind a stock transfer arising out of a loan that was allegedly criminally usurious under Florida law. In a ruling that clarified Delaware law with respect to personal and jurisdiction over stockholders of Delaware corporations and in rem jurisdiction over the stock that they own, the Court of Chancery held that the United States Supreme Court’s ruling in Shaffer v. Heitner generally prevents the Court from exercising in rem jurisdiction in situations where the sole connection to Delaware is the fact that the entity that issued the stock is a Delaware corporation. The Court did note that there is a narrow exception to this general rule, which would allow for in rem jurisdiction in situations where the dispute is related to the legal existence of the stock or its character or attributes. That exception did not apply here due to the fact that the plaintiff’s rationale for asking the Court to invalidate a stock transfer stemmed from an alleged violation of a Florida criminal statute that did not implicate the corporate process or the validity or attributes of the corporation’s stock.